How Much Are Your Trading Mistakes Costing You? Find out!

Mistakes cost a lot, and most traders have no idea the actual dollar value of those mistakes. You could be adding hundreds or thousands of dollars to your income each month; re-claiming money that was yours, but was lost to correctable mistakes.

A few mistakes each month could turn a winning strategy into a poor or losing strategy. 

Most traders don't track whether they slightly overbet or underbet on a trade. We don't add up our missed trades or tally up how much our "random" or "gamble" trades cost us. 

Because we don't do this, we often don't even know if the method we are trading is truly viable.

We tend not to have very good memories, and unless a trader keeps meticulous notes, one, two, or several mistakes a month could easily be forgotten. Thus, instead of realizing that personal mistakes caused a system to fail, they blame the system.

Tracking Trading Errors and Mistakes

I do track errors...and it can be staggering and humbling to see the difference between what a strategy produces if executed well versus what is actually executed. 

Depending on our mental state, some days/weeks/months may be way better than others in terms of how many errors we produce. A daily routine can help keep us in a better mental state more of the time.

AN ERROR IS ANY TIME WE DON'T FOLLOW OUR TRADING PLAN. 

IF WE DON'T HAVE A TRADING PLAN, EVERYTHING IS AN ERROR. 

Errors have nothing to do with profits and losses. An error can be a made on a winning trade while a losing trade could be executed perfectly. Maybe the winning trade was random, or we entered too early or too late based on our strategy; even though it produced a profit it was still an error based on our trading plan. The losing trade doesn't have an error in this case, because even though it was a loss, the trading plan was followed.