Enjoy Your Obstacles
A committed person with a clear goal will encounter an obstacle, refocus on the goal, and move out again toward the goal. An uncommitted person, in contrast, may do a dance with the obstacle that could last a long time. In fact, most people spend their entire lives doing dances with obstacles that get in their way.
In your life, you have up and down periods. Dealing with the market has many such periods. To profit from the up periods, you have to tolerate or even enjoy the down periods; to enjoy the profits, you have to get through the losses. It would be useful if you could celebrate your losses.
If you’re in the market, one of biggest obstacles you’ll face is the losses. It’s fairly difficult dealing with the markets if you are not willing to lose. It’s actually almost impossible. It’s like walking but wanting to use only your left foot, avoiding your right foot. That doesn’t work, and neither does trading without losses.
When you want to be right, you’re not dealing with the obstacles. Instead, you’re forcing things. When you want to make a profit out of today’s trade even though it’s a big loser, you’re not dealing with today’s obstacle. Enjoy the obstacle—embrace it—and be willing to accept it. If the market tells you
it’s time to get out at a loss, do that.
Good traders typically have some point in the markets at which they know they must get out of a position to preserve their capital. Taking this loss is essential. It preserves your capital, and so you should enjoy doing it. However, if you don’t understand that the loss has nothing to do with being right or wrong—it’s just part of the process—you could turn it into a monster. What then happens is that you fight with each loss, and in the struggle the losses typically get bigger. For example, if you are afraid of a Rs.500 loss and won’t take it, you easily could watch it become a Rs.1,000 loss. The Rs.1,000 loss, when not taken, can easily become a Rs.2,000 loss. The net result is a losing trading system.
Think about it. If you have this problem with losses, you easily could turn a good trading system into a losing system. If you don’t realize that it’s your problem with losses, it might become the trading system’s problem.
Good traders realize that they can have 10 to 20 losses in a row. It’s part of the business of trading. It happens, so just accept it and move on. If you have trouble accepting it, you need to realize that the problem is you and deal with that.
Courtesy : Van K Tharp's "Super Trader"
)....so it may not work well for everyone.