Overcoming Loss and Regret as a Trader

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The Short Memory Trader: Strategies for Overcoming Regret and Loss

Many people believe that trading requires intense mathematical skills, an exceptional capability for deductive reasoning and analysis that transcends that of the average individual. However in most cases, none of this is true, as many traders know all of this means nothing if you don’t have the mindset to back it up. Trading is a game of mentality and emotions, how you process information and strategize is just a small part of it. You can learn all the charting tools in the world, but does it matter if you don’t have the emotional discipline to see it through? How you see yourself moving forward, the value you take away from a trading session and how you plan to apply it to future sessions is all dependent on the approach you take both mentally and emotionally. If you tend to be a person finding fault in everything but your own actions, tend to repeat mistakes continuously and seem to act impulsively, it is likely you are unaware on how to gain the most value out of your experiences. Throughout every encounter if analyzed properly, there is knowledge to gain and an opportunity for growth.

The best traders know this and embrace it daily, successful businessmen live by it, and the ones at the top have failed more times than the amateur has even tried. Overcoming regret and loss requires introspection, a plan in which you can reflect on why things went wrong and a resilient mindset that uses losses to overcome future barriers. Advancing past your failures and turning them into opportunities is a process that few are aware of and even less can embrace. However, by embracing it as an integral part of your trading strategy sets you up for enormous success later on in life. It is a lesson that will propel you forward in your career, improve your personal relationships and make you a happier, more confident individual.

Can You Learn to Love to Lose?

We learn a thousand times more by we ever do by winning, but traditional education tends to punish us for being wrong and only focuses on success. As a result, many people have difficulty thinking for themselves or learning from their mistakes. We are creatures of habit, but the tendency to put down and cover up our mistakes is a habit we need to rid ourselves of. It’s been ingrained in us since grade school and is one of the biggest flaws of the traditional education system. Losing is more than okay, in-fact one can even say to embrace it. The differentiating factor however is making sure you’re losing for the right reasons. When we lose, we must understand what went wrong, why it went wrong and if it was preventable. Often with a good strategy that was planned out beforehand, you will still experience losses.

Accept your loss for what it is and embrace it as part of the process. Turn it into an opportunity to learn more about a specific factor that you anticipated would help you predict the right reaction but ended up going awry. You’ll come out more knowledgeable and realize there might have been something you’ve missed Take the time to research things you may not have noticed before in the trading session but notice now. It all sounds simple, but it also requires you have a well-planned strategy to refer back to. Many people that act out of impulse neglect using or even creating a logic based strategy. One of best things you can do in your strategy is write down your emotional state at the time you were placing the trade. If you felt anxious, hesitant or confident will allow you to find patterns in your trading behavior and help you prevent any losses. Most of the time if trading according to strategy and discipline, there will always be value to be extracted out of every loss. However, losses followed by regret are often indicative of another factor entirely.

Grab the Learnings

If you are unable to justify the logic behind your executed trade, don’t have a strategy to refer back to, it is very likely you traded out of impulse and disregarded one of the most important aspects of being a trader. If you don’t have knowledge to extract from a trade, then you aren’t trading but rather gambling impulsively. One should never regret trades executed to strategy as it gives them the opportunity to sharpen their skills and become a better trader. In other words, if you lose money you can look at it as though you payed to gain a lesson. Regret associated with impulsive buys or repeated mistakes put traders in a tough spot, as they now have squandered a portion of their portfolio with no new value to add to their trading experience.

Emotional trading leads to a more than common experience in which disappointment and confusion may overwhelm you. The best way to avoid these feelings is to always plan your prediction, how you should in multiple scenarios, the logic based behind your trade and your emotional state. Acknowledge that emotions come and go as you trade, but should never dictate your trading decisions in an impulsive manner. .

Time Out

Taking time away from trading after experiencing a large lost is something we all must learn to do. Distancing yourself from the trading desk will give you time to cool off, reflect and prevent yourself from digging yourself into an even deeper hole from emotional trading. As none of us are immune to it, we must all be aware of our emotions and put emphasis on controlling them rather than letting them control us. Your mind is the strongest muscle you have and it’s also the one that will fight you the hardest. After an enormous loss, there are so many things going through a trader’s head, it is almost impossible to think rationally entering a new trade within the same time frame.

One of my favorite reference points is understanding how battles are fought and won and looking at the appropriate reactions of generals and commanders. After a large loss, a general needs the time to regroup, reflect and plan out a new strategy, not just rush back in. Treat your money as a coveted supply of freedom fighters with each one bringing you a step closer towards financial freedom. Respect your money and hold it in high regard, don’t squander it. Understand that after a big loss, the best thing you can do for your money is exercise, read and reset. Focus on growing other areas of your life as you plan to reflect on your losses and plan to claim the advantage in future scenarios. .

Change Focus

By bringing focus to other areas of your life that you may have more control over, remind yourself of the affirmation that by “losing” in one area, that loss doesn’t define. Empowering yourself in other aspects means taking care of your health and emotional state in numerous ways. Putting emphasis into these aspects of your life will bring you more fulfillment, higher energy, a more efficient way of processing information and enhance your skills as a trader. With trading being more of a game based on your mindset than analysis, it is imperative you strive to be the best version of yourself in anything and everything that you do. That includes outside that trading room as well. Your habits and inclinations will reflect in your trading strategy, so if you are often impulsive, egotistical and uncoordinated in general, you can most definitely assume you will behave the same way in a session.

In specific regard to health and routine, your goals should always be regimented and specific. Putting specific time frames on them or solidifying them speaks truth to your ambitions. When one is being vague with their goals or neglects to inform others of them, you fail to bring you vision to reality and it is more difficult to have yourself and others hold you to those ideals. In addition to being specific and disciplined about your goals, you must focus on practical goals that are feasible in this very moment.

Most people will tell you to dream big, 10x and go all in, and that’s great, but you need things you can focus on right now. Most people will jump ahead and go all in on a new fad diet, lifestyle change or new routine and find themselves giving up soon after because it just isnt practical. You need to start with things that you can initiate in this very moment. You don’t go from bench pressing 135 lbs to 200 the next day. You slowly build up, train your mind and body and maybe the next time you go to the gym you add 5 lbs on. The same thing should apply when changing your routines and habits. Try waking up 10 minutes earlier, eat a little healthier or go on a 15 minute walk daily. As you watch these little incremental changes take hold, you will be amazed on how they compound and grow you into an entirely new person a year from now. Be consistent, dedicated and realistic about what you are capable of.

Take Ownership and Control

In other scenarios people will place the blame of losses and failures on others. They naturally deflect problems or setbacks and have trouble assuming responsibility. This is a toxic mentality that will not only affect your wallet but can ruin relationships with the people around you. As you grow in your trading experience, you need to realize that the market doesn’t care about your goals, ambitions, stop losses, indicators or strategy. The market will react how it wants and blaming external circumstances will just lead to a bleeding wallet. By assuming responsibility, you acknowledge the fact that there may be a problem, but there is something you can do about it. There is opportunity for growth. By blaming a loss on “bs indicators”, “market manipulators” or “an unfair market” your reaction is stagnant. You rid yourself of the opportunity to learn and improve and this is true in trading as well as life in general.

Problems are just challenges that we need to find a way to overcome. Problems that you faced when you were younger probably seem like trivial issues at this very moment. The knowledge you have accumulated allows you to look at those problems with a wider scope of vision, more experience and the ability to overcome it quite easily. Treat your current problems as such. If there is a problem you are having difficulty overcoming, don’t treat the challenge as the issue, but understand the concept of “leveling up” and take yourself to the next level. Accumulate wisdom through more reading, see if there are areas you can improve in or people you can reach out to so you can gain a new perspective. Approaching problems in this way gives you the peace of mind that any issue you have is not too large to deal with, but places emphasis on the fact that you must simply grow larger than the issue. It takes away our inclination to deflect our issues, turn our losses into victories, gain confidence along the way and seem like a godsend to those around us. .


A successful trader will always know how to turn his losses into wins, advance forward proper strategy and mindset and never fall victim to circumstances. There is knowledge to be gained in every encounter if one is vigilant and resilient. Overcoming a loss should never be an issue because there are always ways in which you can return a better informed and prepared individual. Find solid ground in your capabilities and confidence in your knowledge. Understand that if you find yourself continuously losing without having a strategy justification or value to gain from your trade, it likely means you are acting impulsively and may need a readjustment to how you approach the situation. Let solid growth and habitual advancement from other areas of your life trickle down into your trading lifestyle as you attempt to build a routine that supplements your trading abilities. You will always encounter problems and setbacks as a trader, but the focus isn’t on how big the issue is, but rather how to become bigger than the problem. .

FREE consultation worth £100

Arrange your free consultation to see how Hypnotherapy can help your trading mindset and get a free ‘Down Time Programme’ (RRP £19.99)


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