In today forex faq, we are going to answer a question from one of our fellow traders.
Below is the question
I have read your story and how your account got wiped out twice. I have also had my account wiped out a few times. In between there were winnings that make me feel happy but when my account was completely wiped out, I was really disheartened and find it really difficult to continue.
Besides perseverance, are there any other factors that helped you overcome the disappointment of losing a lot initially?
How do you overcome losses and not give up?
Indeed I got my account wiped out twice in a row when I am new to trading totaling $20K.
From that experience, I understand that it is impossible to make money from trading without a proper strategy and trading is not a get rich quick scheme.
1) one of the best way to overcome this problem that you have is to always start trading with a demo account and not live account. I made the mistake when I am new to trading and this mistake itself costs me $20K of my hard earned money.
That is why I always advice my students to start with a demo account first and only move to live trading when you manage to produce 2 consecutive months of profits in your demo.
The demo account is the best place for you to hone your execution skills plus verify the performance of the strategy you are using.
2) In order to overcome your losses and make them back, the only way is to have a strategy that produce high risk reward ratio. If your strategy has a RR of less than 1, it is practically very hard for you to recoup back your losses.
That is why you can see my live trade video showing 1:2, 1:4 and even 1:6 risk reward ratio trade. This is exactly how I stay profitable every single month without failed. Please do not think that my strategies win 100% of the time. I also have losing trades as well. It is just that my RR is so good that I can easily overcome the losses and turn the account into profits.
Personally if you ask me, these are the 2 ways you can overcome your losses and give you the confidence to move forward.