Warren Buffett has two rules to investing: 1) "Never lose money;" and 2) "Never forget rule No. 1." While Buffett is inarguably one of the best investors of all time, but these two rules are more hyperbole than anything else. In fact, in trading, we have a different No. 1 rule: always ensure that you can trade for tomorrow.
Trading will involve losing money. It will involve being wrong. But that isn't so bad. In this week's Trader Behavior, John Hoagland and CVO Michael Patak talk about why they learned to embrace being wrong in trading - and how that helped them progress in their trading.
Tip for improvement: When you take a loss, change your thinking to: "OK, good. I just paid the market for information." Then take that information to make more money later. Since trading is so mental, changing your thinking can do a lot toward improving performance.
Check it out and leave any feedback in the comments.