Should You Stop Trading?
Have you been trading for months or even for years, but you just keep losing the majority of your trades? Yeah, if you keep losing a ton of money on a weekly basis, you may be wondering if it is time to stop trading.
Some people pour their whole lives into trading, and yet nothing comes to fruition. For some people the only result they get from trading is a big headache and an empty bank account.
If you are wondering if you should stop trading altogether, or at least just for the time being, it’s a reasonable thought. Right now, we want to talk about your own situation and whether or not it is time to stop trading.
Stop Trading if Losing Money Hurts Too Much
The fact of the matter is that not everybody is cut out to be a trader. The highly stressful life of trading, whether stocks, Forex, commodities, or anything in between, just is not for everybody. Many people out there are risk averse and loss averse.
In other words, plenty of folks are really afraid of losing money. More than that, many people feel really hurt, depressed, or stressed out when they lose. Yes, for some people, this is very natural.
At the end of the day, there are two types of traders out there. There are those who can lose some money, even large sums, and then move on from it. Some people have the ability to just buck up, accept their losses, rethink their plan, and try it all again.
The other type of trader is the one who loses money and simply cannot let it go. Some people are overwhelmed with sadness or anger when money is lost.
So, how exactly do you feel about trading, particularly about losing money? If you are the kind of person who just cannot handle the pain caused by losing money, then it might be time to stop trading. There just is not any point in it if you cannot bear the thought of losing any amount of money.
Throw in the Towel if You Are Struggling Financially
One of the biggest signs that it may be time for you to stop trading is if you are struggling financially. Folks, there is no denying the fact that trading requires cash, and in most cases, lots of it. Full time day traders require thousands of dollars on a daily basis.
Yes, this is money that may or may not be lost. A rule of thumb when it comes to trading is that you should never trade with money that you cannot afford to lose. If you are already struggling financially, it means that you obviously don’t have any money to spare.
Now, some people thing that trading is akin to a get rich quick scheme, a great way to make a boatload of money in just a few days. Sure, if you are a pro and you know exactly what you are doing, this may very well be true. However, if you are already in financial trouble, and you aren’t the best trader in the world, chances are that you will just lose more cash, not solve your money problems.
Folks, you need to pay your heat and water bills, pay your rents and mortgages, put food on the table, buy school supplies for the kids, and everything in between.
If you can barely afford to do those things, then you surely cannot afford to risk money trading, and therefore, it might be time to stop trading, at least for the time being. You first need to get your finances in order and put aside some money to trade. Once again, never trade with money that you cannot afford to lose.
Stop Trading if You Need to Borrow Money
Yes, this point is related to the previous one, but nonetheless, it still holds true. We see many people out there who lose a lot of trades, blow their capital, and bottom out their trading account. Yes, it sucks when you blow through all of your money, especially when you can see a litany of lost trades.
However, this doesn’t mean that you should start borrowing money to trade even more, and likely to lose that money as well. Folks, to say it a third time today, never trade with money that you cannot afford to lose.
Borrowed money is definitely the kind of cash that you cannot afford to lose. People, you may not have thought about this, but leveraging trades is more or less borrowing money too. Remember, if a leveraged trade is lost, you are on the hook for a full amount. If you are borrowing money to keep afloat, it may very well be time to stop trading.
Call it Quits if Your Mental State Has Gone Downhill
There is no denying the fact that day trading is very stressful, and for some people it is much more stressful than for others. Has months or even years of trading worn you down to the point where you just cannot take it anymore? Don’t worry, because if this is you, you aren’t alone.
Trading takes time, energy, willpower, fortitude, and overall mental strength. However, a multitude of lost trades and a ton of money flushed down the toilet can turn even the strongest of human beings into emotional wrecks.
If you just don’t have the mental energy or willpower left to trade, then it is time to stop trading. If you don’t have the energy anymore, chances are that you won’t trade properly anyway. If you are mentally exhausted, you will be even more prone to losing money than before.
If you haven’t quite reached this point yet, gather yourself, make a plan, set realistic goals, and realize that it can take years to become a profitable trader. Start small and build your way up. If you start small, even if you lose some cash, at least it won’t be totally devastating.
Time to Stop Trading? – Final Thoughts
People, if you stop trading, it doesn’t mean that you can never start again. Sometimes some people just aren’t in the best position to trade, and if you feel like this, it’s better to stop trading and throw in the towel for the time being. There is no point in wearing yourself ragged, losing money you cannot afford to lose, and ending up worse off than before.
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