Stop trading for the day or not? A survey.

Ok, so I asked you this question last week.

Should you stop trading for the day once you hit a profit target?

A huge bunch of you replied… and I appreciate that, thank you.

So what were the results?

47% of traders said DO stop for the day
42% of traders said DON’T stop for the day
11% said it depends…

A pretty even battle!

The common theme amongst traders who do stop for the day is to preserve mental capital and build confidence.

The common reply from those who don’t stop was to not choke off gains.

Others had some more nuanced way of knowing when to stop.

Here are some of the responses:

    
Build confidence
“Staying content in this game and shooting for small daily gains is the only way in my opinion to make consistent money as well staying mentally and emotionally sound for the next trading day/week/month/year.

But for now, I try to build confidence by ending my days green rather than red.”

Focus on the process
“Continue trading.

Ideally, trading outcome should be a function of trading process.
If one is trading well enough to hit target, on a given day, then capitalising on good form should be the norm.”

Become more selective
“My answer: not, but only enter into a new trade if there is a very high probability of the trade being profitable (favourite setup).

Personally if I get a winner on an instrument it’s not uncommon to get a couple of more winners on the same one. So no, don’t choke off a run.”

Stick to your main ideas, not P&L
“I prefer to focus on one or several main ideas for the day and not trade after the market has run through them, thereby only focusing on the opportunities that stand out the most for me.

That approach may have a similar effect as a profit limit for others, but I feel that it is based on more meaningful parameters and also taking into account the potential of the day.”

Implement a ‘giveback’ rule
“I use a « giveback rule ». Say my max daily loss is $100. If I’m up $200, I won’t allow myself to go below $100 for the day.”

Use a ‘mental capital’ stop
“I don’t think you should stop trading for the day once you hit a profit target. I think you should stop trading for the day once you know your mental capital is used up, once you know you are trading with fear (of losing your profits), or once you think the opportunity is no longer present in the market.”

Are you f*cking up or not…
“I believe it depends on your current level

Eg:
Regularly f*cking up = stop

Doing well = why stop?”

It’s a very personal decision, how you trade the day depends on your experience, your confidence, and your goals.

A new trader just looking to get some confidence might want to lock in that feel-good factor.

So might an experienced trader coming into the end of a quarter.

Other times you might be on fire and know you need to push whilst the going is good.

There’s no right or wrong with this one, and maybe being dynamic and knowing the pros and cons of both is the correct approach.

Sometimes you need to lock things in and other times you need to press.