This is a short YouTube video by Kardec Trader (uploaded Aug 16, 2023) giving practical advice to beginner traders. The speaker warns against entering oversized trades based on overconfidence, neglecting the risk component, and failing to plan for losses. Key takeaway: always factor, accept, and manage risk to avoid large drawdowns and unhealthy P&L behavior.
One thing I did wrong in my early days is a lot of times I would say I'm gonna buy this stock or I'm gonna take this trade. If this trade goes in my favor, I'm gonna make $2,000, completely invalidating the risk component, right? Because it's like you take a trade and you're like, I'm not gonna be wrong, right? So you just go in and you enter the trade. You put on size without even factoring the risk because, hey, I'm taking this trade. I know I'm gonna be right. And when those trades go against you, and they will, if that risk is not managed well, you will have a really, really, really difficult time taking drawdowns or accepting drawdowns or just having a healthy P and L curve in your trading. So make sure you factor in risk, make sure you accept risk, and make sure you manage risk.
