Info!! How To Honor Your Trading Biases

One of the exercises I've establish virtually helpful for traders in addition to portfolio managers is a thorough review of trading performance.  Many times, the ups in addition to downs of profit/loss unwrap biases in addition to patterns inwards our trading.  Some of the patterns worth looking for include:

*  How yous merchandise afterward you've made coin versus afterward you've lost money:  Do yous merchandise more?  Larger?  Do yous merchandise differently based on recent P/L?  Do yous kicking the bucket opportunity averse afterward recent losses?  Does that deport upon your hereafter P/L?

*  How produce yous merchandise when you're taking to a greater extent than opportunity versus less risk?  Does dissimilar size/risk exposure crusade yous to merchandise differently?  Are yous genuinely making to a greater extent than coin when you're taking to a greater extent than risk? 

*  What kinds of markets in addition to marketplace patterns furnish yous alongside your greatest profits?  Losses?  Do yous merchandise selectively to maximize your best opportunities?  Do yous overtrade markets that are non ones providing yous alongside opportunities?

*  What is your ratio of winning to losing trades?  What is the ratio of the size of average winners to the size of average losers?  How successful stimulate got yous been inwards finding large winners?  In preventing large losers?

Many times, our greatest biases in addition to psychological mistakes come upward through when nosotros thoroughly review performance.  The determination to non review functioning is possibly traders' greatest bias blind spot.

Further Reading:  Training Yourself inwards Pattern Recognition
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