Quote from Gil Blake
March 24, 2007 – 12:31 pmGil Blake has a routine of internalizing how he would feel given what might happen on the next trading day in The New Market Wizards: Conversations with America’s Top Traders
My approach is to confront losses even before they materialize. I rehearse the process of losing. Whenever I take a position, I like to imagine what it would be like under the worst-case scenario. In doing so, I minimize the confusion if that situation actually develops. In my view, losses are a very important part of trading. When a loss happens, I believe in embracing it.
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By embracing a loss, really feeling it, I tend to have less fear about a potential loss the next time around. If I can’t get over the emotions of taking a loss in twenty-four hours, then I’m trading too large or doing something else wrong. Also, the process of rehearsing potential losses and confronting actual losses helps me adapt to increasing levels of risk over time.
From the desk of Tradergav.com
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