Different Ways Of Handling Losses
In trading and investing, people are bound to experience setbacks along with success. These setbacks come in the way of losses. Every successful trader and investor has experienced losses in one way or another. It is the way they handle such experiences that let them get back on track. There are many ways many people will handle losses in the market. Here are some of them.
Learning From Mistakes
A healthier and more sensible way of handling losses is by living with it but learn from the mistakes made along the way. Some of the more successful traders and investors know that losses are just part of the process, be it in life or in the stock market. What they can control is by learning from the lessons and try not to repeat it again. This is the best way of handling losses that won’t lead to further complications.
Suppressing The Reality
Some traders and investors just cannot accept losing. They tend to try not to think about it. Depending on the severity of the loss experienced, suppression can lead to the buildup of frustration and inner conflict. If the emotions brought about by such losses are suppressed, they tend to manifest in other aspects of life. Before they know it, the suppressed emotions have spilled into their personal lives, affecting family and friends. Suppression is a dangerous coping mechanism to losses.
Self-Denial
There are some investors that take losses even a bit further than just suppression. They deny that they somehow suffered losses. They believe that it might just be a temporary setback. They believe that things will turn around for the better with regards to their losing investment. So they try to hold on to it, even when the wise thing to do is to unload it and bear the losses while it is still manageable. Their self-denial causes their losses to mount until they realize the mistake only too late. This is another wrong way of handling and coping with losses.
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