How do you deal with greed?

There are mainly 6 Strategies to Overcome Greed in Forex Trading.

Excessive greed leads to big account draw downs & sometimes can blow your account.

We all want more in life.  It is that desire that drives you to want to trade and achieve your goals.

So being greedy for more is an ok thing and a common trait in human beings. But what you should avoid is excessive greed.

That will get you slaughtered in the Forex market.

We earlier mentioned the common symptoms of greed, so now we are going to learn how to control and manage it.

Greed can change your way of thinking to an extent that you want to trade every movement the price makes in the market.

All you need to do is, to get hold of your emotions and only trade following your trading plan.

Let us now discuss some ways to overcome greed in forex trading;

6 ways to overcome greed while trading

1. Have a trading plan

A trading plan contains the guidelines and rules you can follow to trade.

It tells you, when to enter a trade, how to manage a trade as well as how to exit.

Once you have these guidelines to follow, some how it will stick to mind that it is the right thing to do. In that case, your emotions will never determine your trading decisions.

2. Trading discipline

You can overcome greed in forex trading by practicing self-discipline. Trade only when you are supposed to trade and follow your trading plan.

Trading only your plan will help you know your limits and not to over trade.

 Be disciplined about making and maintaining positive trading routines

Don’t chase the market. Missing a trade setup is okay,  there are always more & better opportunities in the market.

3. Practice Self discipline

You have to be able to tell yourself when to stop trading or even if it means no trades at all for some days.

Having a series of technical rules to follow greatly helps but you still need to have the discipline to stick with them.

You must learn to accept that success and failure are both part of trading.

Once you have learnt to accept a failed trade like you do for a winning trade, you will be able to learn from your mistakes.

This will help you to limit future mistakes and losses.

4. Keep a Trading Journal

To over come greed, you first of all have to learn to take responsibility for all your actions.

You have to be accountable to yourself when trading.

Having a Trading journals will help you to record your trades, emotions and decisions you make while trading.

A trading journal tracks the performance of your system hence you can evaluate the results of your trades.

In addition you will be able to know what works and doesn’t, common mistakes you make trading and then rectify them.

5. Have a risk management plan.

When trading, know how much you will risk per trade as well as the amount of profit you expect make.

There is no way your feelings and emotions will control you when you set your risk rules.

Develop a habit of trading with a stop loss because the market does whatever it wants.

It is quite unpredictable, in that just a single minute it can change direction and can cost you too much if you hadn’t set any stop loss.

6. Lower Trade Sizes

If you want to profit from trading, start by learning how to choose the right size for your trades.

A larger size can cause large losses to your account or blow your account. However, very small size does not grow your account.

On the other hand, in case you are new to the market, the small size should be good enough for you to trade.

As you gain more experience choose an appropriate size that fits your stop loss.

The trade size you choose to trade with depends on the size of your trading account.

Another common behavior that is likely to affect your trading psychology is fear. Let’s now discuss fear in detail;