Reasons Why Traders Lose Discipline
Brett Steenbarger’s Top Ten Reasons Traders Lose Their Discipline
10 ) Environmental distractions and boredom cause a lack of focus;
9 ) Fatigue and mental overload create a loss of concentration;
8 ) Overconfidence follows a string of successes;
7 ) Unwillingness to accept losses, leading to alterations of trade plans after the trade has gone into the red;
6 ) Loss of confidence in one’s trading plan/strategy because it has not been adequately tested and battle-tested;
5 ) Personality traits that lead to impulsivity and low frustration tolerance in stressful situations;
4 ) Situational performance pressures, such as trading slumps and increased personal expenses, that change how traders trade (putting P/L ahead of making good trades);
3 ) Trading positions that are excessive for the account size, created exaggerated P/L swings and emotional reactions;
2 ) Not having a clearly defined trading plan/strategy in the first place;
1 ) Trading a time frame, style, or market that does not match your talents, skills, risk tolerance, and personality.
