I am catching up with posting online my articles.
Today I had a chance to work on the point with making emotional decisions. I wrote about it yesterday ( I think ). And I want to continue because I did something different.
Thus today I was a the point when I thought that I should sell my position but I did not do it. Soon later the price has fallen down and I was very annoyed. I was lucky and at least I did not lose any money on it. But still I could have made profit on it. It is important to mention it here as this arose an emotion in me.
Later I opened another position but the price went down straight away. I waited for a moment and I decided to sell it. Soon after I sold it the price started to go up. And again I was annoyed with myself.
Later it happened a similar scenario when I bought something and the price went down. And it was going down. I was kind of panicking and I wanted to sell it to prevent loss. But I decided to stay cool. I looked at the charts and I realised that soon there must be a stop or correction which would rise the price at least a little bit and so I could minimize my losses.
In the moments like this one it is so easy to take emotional decisions. And later we quite often regret it. I stopped this patter in this moment. I look at the facts of reality and I stopped myself from acting emotionally. Soon after I made this decision the price stabilised and started to go up. And eventually I recovered my initial investment with tiny profit. Still tiny profit is better than loss.
Later during the day I had another moment when I was right about the price prediction but I did not make the decision to buy. I was annoyed but it does not matter because I explained myself that I am still learning. Apart from this I realised that I will have many situations in my investing carrier ( if I continue with it ) when I miss the opportunity to gain some profit because I will not follow my prediction. This is part of this job. And this point started to calm down my emotion of being annoyed.
Then there is also the point that not following my instinct to buy or sell something will prevent me from making a loss on the investment. And as a matter of fact I faced this point 2 or 3 times today. And this is very important to bring on here. Because our mind tends to focus only on the loss of profit and forgets about the prevention from making loss made very often through making emotional decisions.
Anyway the point is that I am learning how to avoid making emotional decisions. I do it here with the investment but then I know for sure that if I apply this principle in every aspect of my life then I will less losses and more profits.
To end this article I want to say that I am annoyed that I did not make big profit today although there was an opportunity to do so. But in the end I am still learning and in this process of learning directly on the exchange with real money I did not lose any money today. I even made a tiny profit.