Some sports punish you all the way for a bad shot. In tennis, a bad shot and you lose the point, no big deal. Lose the game, you can still win the set. However, with golf one disastrous hole and it is very hard to win the match. In golf sometimes just that one bad hole will prevent you from winning. That in itself can ruin the whole round for you.

Trading is more like golf than tennis. It is possible to undo years of hard work in your trading on just one trading day. The way it often starts is by revenge trading. A losing trade turns into a rage that turns into jumping back into the market with more leverage. Before you know it you are underwater and you give up caring. At this point, all control is gone and you are just clutching at straws to recover.

One of the key trading skills to learn is how to control that internal desire for revenge. Working for a firm can sometimes help here. You know you have to manage risk within the defined parameters or you get sacked! It is harder when it is just you. However, if you are a retail trader and you do manage risk then you may be showing greater control than even those who are pros.

So if this post is for you. Do something. Determine to manage your risk so you will never again let one day ruin your whole trading year. Then, when you get the inevitable hole in ones they really count.

HYCM Lab is a financial analysis source that provides regular insights on how global news affects the markets including forex, commodities, stocks, indices, and cryptocurrencies*. Run by the HYCM team, it equips traders with everything needed to make informed trading decisions.