This is what unprofessional trading looks like

Good Morning Mr. Bellafiore,

I’ve been reading your book One Good Trade where you talk about traders doing exercises on exiting losing trades. This seems to be my main problem. I’ve had weeks where I’m up close to five figures then on one day give it all back and then some. Mainly because I get this deer in headlights feeling when a trade moves against me. If not that, it’s a FOMO feeling of what if it turns around.

So here I am, knowing why I’m losing money but for whatever the reason in my mind I can’t seem to move past the issue while I’m actually trading.

I’d love to hear your thoughts if you have a moment. If you are able to share in your experience what helps someone work past something like this.

Bella responds

I do hope we can be honest with each other in this discussion.  I do hope you appreciate my response is meant to help.

It actually upset me reading your email.

Your trading here is unprofessional.  You need to immediately return to the demo, trading simulator.

It is not professional to take a position, risk capital, and not have a clear exit plan for your trade.  You intimate the problem is your psychology: “I get this deer in headlights feeling.”  Your problem is your trading system.  Well better said, your problem is your lack of a trading system.  Specifically, your problem is a lack of an exit system for this trade.

You need to know exactly what will get you out of the trade.  As I wrote in One Good Trade, you need to have developed your Reasons2Sell.  And then when one of them arises……SELL SELL SELL.   There isn’t anything to think about.  The sell parameters have hit so now……SELL SELL SELL.

A professional trader would reach out to me with suggestions for an exit system that you will test and implement.  A professional trader will recognize the need for a solution and provide some.

I find your trading to be unprofessional.  I find your email seeking my help without a solution to be unprofessional.  Come on….you are better than that!

I do hope you appreciate my harsh but honest response is meant to help.  You need to do better.

Now look, potentially promising traders will take critical feedback like the above, sit with it, and then take the steps to improve.  There are successful traders at our firm presently who have received feedback like this, cleaned their trading up, and found success.  Losing traders harp on the criticalness of my response.  To the sender, who we have kept anonymous, which one are you?

*And on that note, it has been fun reading and answering questions sent to me from the trading community.  This might have been the last one after that response above.  Well it was fun while it lasted.

Enjoy your weekend.

Train and trade well.


Important disclosures

Mike Bellafiore is the Co-Founder of SMB Capital, a proprietary trading desk, and SMB Training, which provides trading education in stocks, options, and futures. Bella is the author of One Good Trade and The PlayBook. He welcomes your trading questions at [email protected]