Why Do Most Traders End Up Losing Their Accounts?

Trading ( always brings a glamorous and promising feeling from the outside. Many people enter the market with the expectation of doubling or tripling their assets in a short-term. But the harsh reality is that most traders lose more than they gain. The cause lies not only in the severe volatility of the market but mainly in the wrong approach. Below are common mistakes that cause traders' accounts to "evaporate" quickly.

1. Overtrading )Overtrading( Many people believe that the more they trade, the easier it is to make a profit. However, in reality, not every trade increases risk, transaction fees, and can wear down one's psychology. Successful traders often only choose times with a high probability of winning, patiently waiting for opportunities, rather than "jumping" into every small market fluctuation.
2. Poor Risk Management One of the fundamental principles of trading is that protecting capital is more important than making profits. Trading without setting a stop-loss is like setting sail without an anchor. Just one strong drop can wipe out the results of a whole month. Professional traders always determine in advance the maximum loss they can accept and cut losses decisively when necessary.
3. Emotional Trading Fear, greed, impatience, or anger can turn a rational strategy into a major mistake. When emotions overshadow reason, traders are prone to chasing prices, panic selling, or hastily trying to recover losses. To survive in the long term, traders must learn to control their psychology and adhere to discipline, rather than letting emotions dictate their actions.
4. Follow the 'Pump' Moves Most retail investors tend to jump into the market when a coin has surged significantly. However, at that time, "whales" are often quietly exiting their positions. As a result, retail traders become the ones who "buy high, sell low." Instead of chasing short-term waves, traders need to focus on analyzing trends and finding entry points before the market explodes.
5. Lack of a Clear Plan Trading without a specific plan is no different from gambling. A trading plan must include: Entry point )entry( clearStop-loss level )stop-loss( tightTake-profit target )take-profit( reasonableRisk/reward ratio )risk-reward ratio( calculated in advance Without a plan, traders can easily be swept away by the market and make impulsive decisions. Conclusion: Trading is a game of patience and discipline. Success in trading does not come from winning every trade, but from surviving long enough for the account to grow steadily. Those who know how to manage risk, control emotions, and adhere to plans will always have a significant advantage over the majority. Trading is not a gamble, but a journey of cultivating discipline and self-control. Those who understand this early will have the opportunity to become the few who survive and thrive in the market.