Millionaire TradersQ: You take that big hit then you close the screen and you walk
away?
A: Two things: Sometimes there’s nothing you could do about it.
Sometimes you have situations in the ER where somebody wanted
200 and they entered 2,000, and it will crush the market. There is
nothing you can do other than walk away and make good trades.
And most traders really struggle with that. You watched me trade
enough to know that my strength is coming back from a bad trade
because I just try to make more good trades, do the same thing
over and over again. Physically, if I’m struggling, what I like to do
is trade size for a very small profit. I’ll maybe trade 50 or 100 lots
for a half point and do the same thing over and over again.
Q: Just to get the rhythm back and to regain some loses?
A: That’s right. String together some winners, some singles.
Q: So clearly the one thing you never do is you don’t try to get
everything back at once. Let’s say for argument sake you dropped
five points on a trade and then your methodology is I’m going to
take half a point, three-quarter of a point to constantly chip away
at that loss?
A: Over and over again.
Q: How did you come across that kind of a methodology? Was
it natural? Or is this something you really consciously realized was
the right thing to do?
A: You know, I think I learned the hard way. Revenge trades
are the most costly trades. If you have a bad trade and you try and
make it all back in one time, you’re going to lose more money. I