fear of real money trading

Hi All,

This would be my first post on this forum, although i have been here sniffing for a while already. And to those who are not aware - big thank you for all your brilliant ideas and advices.

I find it difficult to overcome a stressss of using real money. I have been playing demo for a while, up to 80% of profitable trades /as per stats/. Once i click onto my real money account, my confidence is gone, i reanalise decisions, trading takes long, in result of which i am hitting dumb 50% effectiveness.
I have no idea how to overcome it. Even a few euro account makes me anxious.

I went through a few stages of trading by now:
1. positive demo tests
2. first few 00s blown out of unconscious inconfidence
3. testing strategies, indicators and god knows what else, didnt spend anything on these
4. got rid of 80% of indicators, left almost bare candles, and formulated detailed trading system
5. up to 80% of profitable trades while on demo
6. another trial with money - fail
7. beetween every step - lots of studying, forums, manuals, brokers edu materials. I even changed a broker who was tweaking my charts. One day i witnessed a M1 chart candle, poping down to trigger my trailing stop loss set just 2 pips below - it looked like a candle would touch a hot surface.

What do i do wrong?
I am getting frustrated.

I noticed that i actually win trades, when i dont over analize, dont polish decisions too much, few looks around - and order is placed.
Today for example, it took me 4 minutes to place 3 winning trades ,each on different pairs, on average 15 pips each! I trade on 30min charts. I checked them every few minutes, after an hour the reward was there.

Any help would be much appreciated.

It sounds like you are sitting staring at the platform money meter going up and down....if you do this, then rational decision making will go out of the window.

Managing trades on the fly is a skill that comes much later down the line, when and if you achieve this level of proficiency. In the mean time, stick to a rigid plan.

Pre-define each trade and it's parameters (entry, stop) how many points/pips you are willing to risk.

Take profit or targets do not have to be defined in the same way as trade entry and stops do. If a trade is behaving as per your expectancy of it, then you can ride it until it gives you a reason to close.

I certainly wouldn't recommend starting out as a trader with real money by trading on time frames of minutes. Too much pressure.

Why not swing trade? Plot trade set-ups that take a few days to mature, using the same TA skills as you would use over a single session, but take time to plan ahead, not just rely on reactions to price changes. You'll also have more time to reflect on your log of closed trades, how they could have been better planned as a group - there's no use relying on unique situations or decisions that cannot be replicated next week: that will just mean you're rich for about a week.

It's the exits that determine whether a trade was good or bad, and daytrading is founded on entries.

How long have you been trading, cyberbob? IMO you're not doing anything 'wrong', just going through the learning process, which is something that never stops, no matter how many years you're been plugging away.

Don't spend too long on demo. Better to use real money and small stakes. You could even post on the unofficial Spank the Bucketshops comp, which despite the lulz factor would probably help you to work things out.

Ross Spur said:

How long have you been trading, cyberbob? IMO you're not doing anything 'wrong', just going through the learning process, which is something that never stops, no matter how many years you're been plugging away.

Don't spend too long on demo. Better to use real money and small stakes. You could even post on the unofficial Spank the Bucketshops comp, which despite the lulz factor would probably help you to work things out.

Click to expand...

Hi Ross,

I have started on 20th of April, this year. So it hasnt been 4 weeks yet.
Trading is something i have been waiting to do for a long time - proffesor in college infected me 11 years ago. Businesses, jobs, children... never had time to sit to it. I am 34.

I have done it yesterday - just left 7 eur on the account for the mercy of god, and trying to build confidence using cents. Funny - feeling is excact same, i think i just have to loose a bit first to learn this skill.
I must say i enjoy learning process - posts, bloomberg, newspapers, all world around us. And what previously was just an interesting story, today became a market hint - whole EU battle to keep it going.

Thanks for your advice.

counter_violent said:

It sounds like you are sitting staring at the platform money meter going up and down....if you do this, then rational decision making will go out of the window.

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Yes, i look at it this way.
I look at forex like it is a money maker, rather than hobby. Get in, make money, get out.
If there was no money involved, i dont think i would do it. It would became boring then. I am sure there is a group who sees it as great fun to watch the charts all day, but for me, it is a thrill of potential earnings.
I did a spreadsheet few days ago, what would happen if i added 10% each day to current balance. Annualy figure made me not willing to call my customers
As well, i really think that forex, as a alternative to running business or having a job, is the easiest way of earning. When you run a business, you need to put energy into product, people, logistics, property, so much to learn and master, with forex - just learn what happens on the screen. No mess with sick days of your emploees, inflation, change of legislation, just learn the screen
I am simplifying it a little, i know, it is simple tho.

Well, first of all, your fear is not about trading real money, it's about losing the money.

Are you able to trade live, but with amount of money, which is small enough to not affect you emotionally?

cornixforex said:

Well, first of all, your fear is not about trading real money, it's about losing the money.

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Thats very true :clap: Didnt think this way before.

cornixforex said:

Are you able to trade live, but with amount of money, which is small enough to not affect you emotionally?

Click to expand...

I have started using tiny amounts, a few euro, i already got comfy in it after just two days. Well it still bothers me a bit, but at least i am not getting a heart attack

cyberbob222 said:

Hi Ross,

I have started on 20th of April, this year. So it hasnt been 4 weeks yet.
Trading is something i have been waiting to do for a long time - proffesor in college infected me 11 years ago. Businesses, jobs, children... never had time to sit to it. I am 34.

I have done it yesterday - just left 7 eur on the account for the mercy of god, and trying to build confidence using cents. Funny - feeling is excact same, i think i just have to loose a bit first to learn this skill.
I must say i enjoy learning process - posts, bloomberg, newspapers, all world around us. And what previously was just an interesting story, today became a market hint - whole EU battle to keep it going.

Thanks for your advice.

Click to expand...

If you've only been doing this a month you seem to be putting a lot more thought into it than most people. From what you said, I assumed you'd been trying for much longer, hence the comment about not staying on demo.
Expecting to make money so soon is unrealistic, and you'll have to forget the idea that trading is easy or doesn't require as much effort as a 'real' job. You'll realise that after a year or so, probably having blown a couple of accounts.

Ross Spur said:

You'll realise that after a year or so, probably having blown a couple of accounts.

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I am sorry, but i must disagree.
My micro account grows each day - regardless the portion - so it is a way of making money. But to have it right, i need to have consistency. Lets say i can make min 20pips a day, max 200. Which happened yesterday and the day before.

If you were to start a business, you would have to put much much much more time and money to get it going.
Trading seems to be the lowest cost start up ever. For wiser ones of course

Trading is technically very easy - it is the psychological aspect that is very difficult - as you have now experienced. You now have to accept the challenge and learn to control your emotions, which might take a few years to achieve and will cost you (not a lot if you're sensible) or refuse the challenge and quit trading.

Good luck with your trading Cyberbob ! The spreadsheet is a good idea in my opinion !

cyberbob222 said:

I am sorry, but i must disagree.
My micro account grows each day - regardless the portion - so it is a way of making money. But to have it right, i need to have consistency. Lets say i can make min 20pips a day, max 200. Which happened yesterday and the day before.

If you were to start a business, you would have to put much much much more time and money to get it going.
Trading seems to be the lowest cost start up ever. For wiser ones of course

Click to expand...

Don't be sorry about disagreeing with anything I say.

If your micro account is growing each day, then you're already being consistent - far more so than most traders, who inevitably have losing days. In theory, if you carry on the same way you'll be able to make limitless gains by scaling up.

Sadly, that's unlikely to happen, which brings us back to the hours, weeks, months and years you'll probably need to spend getting anywhere near that stage.

cyberbob222 said:

I have started using tiny amounts, a few euro, i already got comfy in it after just two days. Well it still bothers me a bit, but at least i am not getting a heart attack

Click to expand...

There you go. Start with size which is comfortable for you, little stress is OK but not too much to interfere your decisions. As you feel stress disappears and you feel greed to make more money and want to increase the trading size, scale up, but a bit... Do this slowly and over time you'll seemlessly trade big size and feel comfortable about it.

It's the nature of human, maybe just start with mini mount, build the pattern of trading, then you will build the confidence.