Emotions make us human. However, in trading, as a result of emotional imbalance, an investor can make many irrational decisions in his CFD trading career. Experts have identified the most common emotions that can lead to people losing money in FX. Today, we will focus on the ways to control our emotions.
List of deadly emotions in trading
Fear of losing money haunts traders from the beginning their investment careers, and this deadly emotion can shut down the possibility of becoming a CFD trader in the United Kingdom. Most beginners fear coming in the market because they are frightened of experiences sudden loss.
Fear can be manifested in the mind of newbies in a number of ways. Actions taken under its influence can turn into mistakes. Fear compels rookies to take a decision after a slow realization, and they do not feel an urgency to take the emergency step. They close their trades early, which could have taken on a winning shape later.
This deadly emotion prevents traders from achieving success and becomes the easy target of it when they do not use their conscience properly. It may seem hard at first to control it, but continuous attempts may help us to triumph over greed at last. Check here and read some risk management articles from the top trader at Saxo. They will definitely help you trade better.
Investors who are dominated by greed do not adhere to the proper risk to the management system and build a gambling mindset. But trading in the Forex market without maintaining any specific rules or undertaking any kind of research activities may open the way to failure. Impulsive decisions will reinforce the loss, which may force traders to close their FX account.
Hope, greed, and fear often go together. If an investor understands that he is going to lose, he shows some hope, which may not be rewarded at the last. Without conducting proper research about the market, a beginner cannot expect anything better. Another example we find about the hope in an investor who is ruminating on their past trading activity and making better the future. Hope cannot work if there is no activity with a rational strategy.
When rookies get overly anxious, they buy financial instruments based on their own opinions without researching the market. Sometimes, even they take the lot size bigger to make the highest profit, which can prove as a bad dream later. Traders should keep their emotional state neutral before taking part in FX as this emotions and nerves can negatively influence a trader’s career
This can be regarded as a negative emotion that makes an investor stay inactive even though he has the wish to make money. It shows the sign of an unfocused state where one finds losing the interest to conduct the task diligently. It happens with people when they have to perform the same activities again and again without any divergence. When you feel lethargic, you should perform a short physical exercise activity which can refresh you and help you perform tasks at full speed. Drinking coffee or tea can also help us to be energetic and deliver the tasks rightly at the right time. To run a trading business on CFD market, one needs quick decision-making ability.
So, on the basis of minute observation, now, it is clear to us that without having proper control over the emotional elements, it is hardly possible for any investor to gain huge profit. A disciplined lifestyle with exercise and meditation can be proven ways to control your emotions effectively.