Day 13: Things To Consider (How to handle loss)

to consider when you are trading options especially if you're new identify if you made a mistake so like say you are paper trading and you didn't turn out the same way that I turned out right your trades like you lost money and I made money okay uh obviously something went wrong and instead of just kind of you know thinking oh maybe you know I'll just figure out next time I'll wait for the next next thing to come my way and I'll figure it out then you should really just sit down and figure out what you

did wrong okay and then fix that mistake you made in your setup right here identify where you went wrong and fix it right away because the market doesn't care it's unforgiving and other people are moving too fast usually to really stop and help you so if you don't take responsibility for fixing your own issues especially after you know watching a whole course and then taking care of or you know there's a ton of YouTube videos out there um you should definitely know how to do this and if you don't it's no big deal just you

know do a little bit more research that's the information is out there for you to figure it out all you just have to do is find it and then listen to the video that's all it is all right this is a big one too SS trade entrance and exit errors so this it could be a multitude of different things but just whenever you're trying to buy it'll give you an error meaning you cannot buy it okay and even worse maybe you're in a contract and it'll give you an error of like hey you actually can't

sell this so you need to know exactly what type of setup you're going for and if you can even trade options or or whatever there's a list online you can go through of different um entrance and exit errors and there's so many that it would be pointless to try and cover all of them in this course um but just make sure you go through and you make sure you can actually buy and sell contracts before you get you know too into it because if you can't even get that down then I mean obviously you can't

trade so the next one is uh you need to have a solid risk management and asking people for advice or watching YouTube videos on this um is good but only if they're teaching you how to set up your own because other people's risk management is going to be a lot different than yours say if you started a small account right you just started trading options a little itty bitty baby account um your risk management is going to be a lot different than mine because I always trade five contracts never go over right even though I've

been making more money and obviously I have a lot more money than what I started with I only trade five contracts at a time you might not be able to do that and it might be not smart for you to do that because I have a stockpile of money if I lose the a trade and I'm down on those five contracts and I have to sell out I have a ton of money I can jump back in with so my risk tolerance is a lot more beefy than you know some other people and I'm not

trying to brag because there's like there's other people out there that they would call me a small fry and then be making fun of me right now saying that my rich tolerance is is garbage but you need to be able to calculate that and it's it's a lot about what are you personally willing to risk some people say I have this thousand dollars I'm going to trade until this thousand dollars is gone and as soon as it runs out I'm done you know and that's some people's risk tolerance some other people they go slow and

maybe they they trade three right they trade three options contracts and they lose for this example we'll say they're making money okay they they lose one they gain two so they just made some money instead of going all in again you should actually keep some of that money back especially when you're small and then keep playing and then whatever you win and profit money hold some of it back let's call the moon back all right and that's like that's money that just came out of the ether right you just made that in the stock market

and that money is your recushion and the bigger your cushion gets that's when actually you can pull money out and start spending it and it feels good right but you shouldn't actually pull money out and start spinning it like crazy until you have a pretty sizable Moon bag I would say the size of or double your initial investment but that's me personally like that that's what I would do you guys need to calculate your own stuff individually uh because like I said everybody's different all right the next one is emotions all right you cannot get

emotional okay everybody's been through this especially when you first start it's rough because you see that your account's going down and obviously you do not want to lose money and you know if you lose a trade then it's gone right not getting it back the part about emotional trading and I think most people don't talk about and they kind of miss the mark on is why you need to keep emotions out of it in the way that it keeps you from actually getting better because this goes with anything if you want to get like college

job right or maybe you want to start your own business the higher the risk the more the reward typically and high risk things are usually a little bit more difficult it takes time to learn unless you're like gambling at a casino it's easy and they just steal your money basically but it this isn't gamble this takes time to learn and people do get rich off of it they do win and the reason why there's a statistic out there that says like 90 of options and day Traders lose is because they can't handle their emotions uh

I remember back when I was working the job I had a co-worker and he was telling me about how he he was trading options he had a mentor a guy was teaching him how to trade options and the guy was killing it his mentor was it was a crushing it in the market right he's making a lot of money he couldn't do it because he would sell it too early or he would hold it too long he would get emotional he would stop for a couple weeks and he wouldn't learn or he wouldn't progress at

all in his trading journey and he tried to jump back into it and then he'd get hammered again and that's the thing you need to push past the part of getting hammered and that goes with anything in life it doesn't matter if it's a gym starting a business going through college it's going to be hard at the start and you're going to get hammered and that's a part of learning failure teaches you it's painful but it's all part of the game and if you don't want to deal with the pain then that's okay there's a

lot of people that will and those people are going to end up you know I don't really mean right but they're gonna end up living your dream because success is painful it's it just is