{
  "id": 15695464,
  "title": "Pro Traders Cut Their Position Size After a Losing Streak While Beginners Do the Exact Opposite",
  "url": "https://urgent.news/2026/10/14/pro-traders-cut-their-position-size-after-a-losing-streak-while",
  "topic": "tech",
  "section": "Tech",
  "published": "2026-10-14T01:28:13.000Z",
  "source": {
    "name": "Vulcan Post",
    "slug": "vulcan-post",
    "url": "https://vulcanpost.com/914008/pro-traders-cut-their-position-size-after-a-losing-streak-while-beginners-do-the-exact-opposite/"
  },
  "original_language": "en",
  "account": "People in Malaysia, like those witnessing a competitive badminton match, recognize the sensation of dropping several points consecutively. Those who react by playing more cautiously and taking a breather are usually better off than those who attempt to overpower their opponents out of frustration. Similarly, the same pattern can be observed in the financial markets, with traders in Malaysian cities such as Kuala Lumpur, Ipoh, and Kota Kinabalu experiencing this phenomenon frequently.\n\nFollowing a streak of losses, some traders opt to reduce their position size, while others decide to increase it, sometimes to an extreme extent. The latter group tends to remain active in the trading world a year later. The reason behind this disparity lies in the fact that a losing streak significantly impacts both the trading account and the trader's psychological state. The effect is more profound than the cumulative loss itself, and enlarging the position size exacerbates this negative impact.\n\nDuring a losing streak, the mathematical difficulty of recovering increases exponentially. If an account drops by 20%, it requires a 25% gain to recoup the loss, while halving the account necessitates a doubling of the remaining funds to break even. Each subsequent loss in a losing streak compounds the damage, and a larger position size only accelerates this process. Moreover, the trader's mental clarity deteriorates after consecutive losses, with emotions such as anger, embarrassment, or desperation clouding judgment when making trading decisions.\n\nBeginners, though not unintelligent, are often driven by the instinct to rectify losses swiftly. This inclination frequently leads them to increase their lot size on the next trade, intending to recover all previous losses in one go. Although this approach may seem logical, it exposes traders to the highest risk at the moment when their decision-making ability is at its lowest. If the subsequent trade also fails, the trader's losses escalate rapidly, creating a vicious cycle.\n\nAn alternative reaction among beginners is to abandon the established trading plan entirely. They may move their stop-loss orders further away, make impulsive decisions based on gut feelings, or enter trades randomly, such as jumping into USD MYR at odd hours due to a minor price movement. While this strategy occasionally yields positive results, it often leads to detrimental consequences, teaching beginners an ineffective approach that can persist for years.\n\nExperienced traders, on the other hand, tend to adopt a more conservative approach after a losing streak. They reduce their position size, typically by half or more, and patiently wait for market conditions to improve before resuming their normal trading strategy. This conservative approach involves maintaining the same trading plan but with less capital at stake until a series of successful trades restore confidence. This method may appear mundane but serves as a protective measure during times when protection is crucial.\n\nSometimes, experienced traders choose to take a brief break from trading altogether. For instance, a trader in Penang might close their laptop at 9 pm on a Thursday following three consecutive losing trades and decide not to reopen it until Monday. This decision does not signify giving up but rather resembles the behavior of fishermen on Malaysia's east coast who remain ashore during the monsoon season, recognizing that the sea will remain active once the weather stabilizes. The primary objective is to navigate through the challenging period while preserving sufficient funds and confidence to fully capitalize on future favorable market conditions.\n\nIn summary, everyone experiences losing streaks in trading, regardless of their experience level. The key difference between successful traders and those who struggle lies in their actions following such setbacks. Those who lose frequently tend to perform better when they adhere to the following advice: trade smaller positions, strictly follow their established trading rules, and allow ample time for recovery before resuming trading activities. While this approach may lack excitement, it significantly enhances the likelihood of long-term success in the financial markets.",
  "summary": "Anyone in Malaysia who has watched a tight badminton match knows the feeling. A player drops four or five points in a row, and the smart ones slow things down, take a breath and play a little safer until the rhythm comes back. The ones who start smashing every shot out of frustration usually lose […]",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}