Risk is inherent in trading. One must accept and embrace risk as a companion in this business.

That said, there are trading behaviors that bring EXTRA and UNNECESSARY risk to your portfolio. One of them is averaging into/adding to losing positions...

… The crazy thing is- every good trading book out there says the same thing about adding to losers- yet so many still do it. Early in my career I did it all the time- even though I knew better.

Why?

I wanted to be right. As Van Tharp said in his classes and books...

… “Most people would rather be right than make money.”

And it’s true. Early in my career I was very concerned with being right. I blew up accounts by averaging down into losers and trying to force my will upon the market.

It doesn’t work that way…

If you’re a relative newcomer to trading- please accept this wisdom so you can stay in the game...

"Losers average losers.”

Give up the need to be right. Trading is risky enough as it is.

Peace...