How professional investors manage risk and why trying to avoid every loss is a losing strategy.
Losses Are a Normal Part of Investing
Every great investor has losing trades or bad investing decisions
The real risk isn’t small losses — it’s large, portfolio-crushing losses
Why Trying to Avoid All Investing Losses Backfires
Selling too early
Avoiding necessary risks
The goal is not perfection — it’s discipline.
Cut your losses early when you’re wrong
Keep your investing losses smaller than your investing gains
? Analogy: Investing is like professional sports. Even the best teams lose games — but they win the season by managing losses and maximizing wins.
A small loss is easy to recover from. A big one isn’t.
Common Investing Mistakes to Avoid
Adding to losers without a clear plan — also known as "averaging down"
Ignoring risk/reward calculations — focusing only on potential profits
Quote to Remember
Read Next:
The Danger of Over-Diversifying
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This article was written by Itai Levitan at www.forexlive.com. Read More Details
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