The most common reason of 90% retail traders lose money in the stock market is not booking losses early. ❌❌
*Booking losses* when a stock hits stoploss is the most important part of trading. It is a crucial strategy for long-term success. 🚀🚀🚀
The primary goal of trading is to make profits. However, it's equally important to protect your capital. When a stock hits its stop-loss, it means the investment is no longer performing as expected. By exiting the position, you prevent further losses from eroding your capital. 📉📉📉
Stop-losses are a risk management tool. They help you define a maximum acceptable loss for a particular trade. When a stock reaches the stop-loss, it signals that the risk has materialized. By exiting, you're limiting your exposure to potential losses. 👍👍
Emotions can often cloud judgment in trading. When a stock is losing value, it can be tempting to hold on in the hope that it will recover. However, this can lead to larger losses. By sticking to your stop-loss, you're making a disciplined decision based on objective criteria.
So, never be afraid of booking losses. It's in fact the most important part of trading success. 🙏
