Day 1: The Three Fundamental Questions Trading is simple…
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Day 1: The Three Fundamental Questions
Trading is simple: Buy low, sell high (or short high, cover low).
Why do most traders lose money?
They let losses run (hoping price will reverse) and cut profits early (fear of reversal).
Example : You buy a stock at ₹100. It drops to ₹95. You hold, hoping it returns. It falls to ₹80. Loss becomes huge. On the other hand, when it rises to ₹110, you sell quickly for ₹10 profit. Repeat this 10 times — 5 small wins, 5 big losses = net loss.
Lesson : Profitable traders keep losses small and let winners grow. You don’t need 70–80% win rate. A 50% win rate with good risk-reward is enough.
Trading is simple: Buy low, sell high (or short high, cover low).
Why do most traders lose money?
They let losses run (hoping price will reverse) and cut profits early (fear of reversal).
Example : You buy a stock at ₹100. It drops to ₹95. You hold, hoping it returns. It falls to ₹80. Loss becomes huge. On the other hand, when it rises to ₹110, you sell quickly for ₹10 profit. Repeat this 10 times — 5 small wins, 5 big losses = net loss.
Lesson : Profitable traders keep losses small and let winners grow. You don’t need 70–80% win rate. A 50% win rate with good risk-reward is enough.
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