Ways to overcome overtrading

Overtrading its always been one of the issues most traders encounter. We have cover how to identify if you are overtrading, if you miss that you may want to check out this link https://streetquants.com/trading/how-do-you-know-you-are-overtrading/

In this article, we will cover ways to overcome overtrading. 

  1. Stick to one trading setup

It is so important to stick to your trading setup so that you can evaluate the trading strategy and enter only when the criteria are met. Otherwise, it is just gambling and easily falls into overtrading.

  1. Have a trading checklist

Having a daily trading checklist or set up your daily routine for your strategy. Trading is full of emotions with greed and fear, with some written rules and checklist it will help you to stay in the right direction.

  1. Stop trading

Knowing when you should stop trading and take a break is important otherwise you will continue to lose money until you decided to give up. Whenever after 30 trades of a strategy and doesn’t make money should flag as an alert you should stop using the strategy or stop trading.

  1. Accountability 

This is perhaps the most important thing is having someone to report your trading result and action. Above all the suggestion require discipline to execute, not to mention it has to be executed over a long period. If you manage to find someone to report to will keep you on track. Psychologically will make a huge difference because you will need to explain your action compare to someone who can just keep quiet over a large loss or not following the checklist and strategy.