Which One is More Harmful? Fear or Greed?

reecerispoli1

Trader
Sep 22, 2020
69
6
19
31
Fear and Greed are two emotions that forex traders have to control. New forex traders have a lot of problems with these two emotions.

Greed is the first emotion that starts bugging. When someone just starts learning and trading forex and reads about the money that a trader can make through forex trading, he/she thinks about nothing but making a lot of money through forex trading. Unfortunately many new forex traders are not "lucky enough" and so they succeed to have some good trades in their demo accounts at the beginning and this makes them think about opening a live account and making real money. I call this bad luck, because as soon as they start trading their real money, they see the other side of forex trading and forex market. They lose and so greed will be replaced by fear.

For a long period of time they move between fear and greed. Sometimes they are fearful and sometimes they are greedy. When they have a losing trade, their fear show up and when they have a successful trade, their greed takes the control. When they are greedy, they are overconfident and so they click on the buy/sell buttons bravely and when they are fearful they have no confidence and so they just watch the market and don?t dare to take any position even when there is a good trade setup.

Most of the new traders give up at this stage and so they lose the chance of making money through forex trading for the rest of their lives.

But it really does not have to be ended like this. A new trader can easily pass this stage and become able to control his/her emotions, if he/she follows the below stages:

1. A new forex trader has to spend a few months on learning the forex market and forex trading basics.

2. Then he has to learn a trading technique and a trading system. This is an important stage, because if he tries to find and try a new system on the forums and different forex related websites, he has to spend his whole life in trying different systems and so he will never become a trader.The solution is finding a successful trader and asking him to share his trading system. The reason is that he has already tried that system and probably it is the system that he makes money with every month. So you know that it works. But if you want to find a system from the forums, you really don?t know if it will work or not. So you have to spend a lot of time in trying the system and it is highly possible that after a long time, you come to this conclusion that the system is not applicable for live trading. On the other hand, a professional and successful trader tells you everything about the pros and cons of his system and he will share the "do"s and "don't"s. So you do not repeat the same mistakes that he made when he was developing the system.

Therefore, instead of looking for systems on the forums, try to find a good trader and ask him to teach you. But make sure that he is a real trader because there are many people who introduce themselves as good and great traders, but they have never been profitable in reality. So be careful.

3. After finding a good and reliable trading system which is taught by an experienced forex trader, you need to try the trading system on the demo account at least for few months. You should forget that you are demo trading and you should treat your demo account as a live account. Only in this case you can built the confidence that you need for live trading. Otherwise you will do nothing but developing bad trading habits. When you succeed to trade profitably for few months consecutively, you can open a live account and start trading with a small amount of money. You need to rebuild your confidence with your live account and to do that, you have to trade with a small amount of money and when you succeed to trade profitably for few months, you can increase the amount of the money that you trade.

You are there

If you follow the above stages, you will see that fear and greed can never interfere in your trading, because you will not give them any chance to do this. Greed can not take the control, because you do not start with trading a lot of money and fear will not show up because you do not lose your confidence because of losing a lot of money.
I would have to say Greed
 

no_frame

Trader
Aug 21, 2021
44
2
9
32
I'd say Greed, because it is easier to blow up on your account if you get a little bit of greed. Fear is what will hold you back from trading or pulling out earlier in trading.
Both are something that traders need to, in general, keep working on to control them
 

e_abrams

Active Trader
Dec 11, 2020
451
31
39
41
One should be free of both when trading, yes, but that almost never happens. It's just part of human nature, for better or worse. The best most people can achieve is to keep them under control.
 

Dora_WalletInvestor

Active Trader
Aug 17, 2020
301
46
44
One should be free of both when trading, yes, but that almost never happens. It's just part of human nature, for better or worse. The best most people can achieve is to keep them under control.
I totally agree! I don't like when people give the advice "get rid of your emotions" because that is not a realistic goal. We need to accept that we will experience negative emotions through are journey, and learn to manage them instead of trying to suppress them through sheer willpower.
 
  • 👍
Reactions: e_abrams

e_abrams

Active Trader
Dec 11, 2020
451
31
39
41
Exactly. It is neither realistic nor healthy, I believe. One can repress their emotions only for so long before they burn out and then the consequences are pretty serious, for their trading and for their health, I believe.
 
  • 👍
Reactions: Dora_WalletInvestor

JoshEvansFX

Trader
Jul 7, 2021
52
4
19
31
Fear and Greed are two emotions that forex traders have to control. New forex traders have a lot of problems with these two emotions.

Greed is the first emotion that starts bugging. When someone just starts learning and trading forex and reads about the money that a trader can make through forex trading, he/she thinks about nothing but making a lot of money through forex trading. Unfortunately many new forex traders are not "lucky enough" and so they succeed to have some good trades in their demo accounts at the beginning and this makes them think about opening a live account and making real money. I call this bad luck, because as soon as they start trading their real money, they see the other side of forex trading and forex market. They lose and so greed will be replaced by fear.

For a long period of time they move between fear and greed. Sometimes they are fearful and sometimes they are greedy. When they have a losing trade, their fear show up and when they have a successful trade, their greed takes the control. When they are greedy, they are overconfident and so they click on the buy/sell buttons bravely and when they are fearful they have no confidence and so they just watch the market and don?t dare to take any position even when there is a good trade setup.

Most of the new traders give up at this stage and so they lose the chance of making money through forex trading for the rest of their lives.

But it really does not have to be ended like this. A new trader can easily pass this stage and become able to control his/her emotions, if he/she follows the below stages:

1. A new forex trader has to spend a few months on learning the forex market and forex trading basics.

2. Then he has to learn a trading technique and a trading system. This is an important stage, because if he tries to find and try a new system on the forums and different forex related websites, he has to spend his whole life in trying different systems and so he will never become a trader.The solution is finding a successful trader and asking him to share his trading system. The reason is that he has already tried that system and probably it is the system that he makes money with every month. So you know that it works. But if you want to find a system from the forums, you really don?t know if it will work or not. So you have to spend a lot of time in trying the system and it is highly possible that after a long time, you come to this conclusion that the system is not applicable for live trading. On the other hand, a professional and successful trader tells you everything about the pros and cons of his system and he will share the "do"s and "don't"s. So you do not repeat the same mistakes that he made when he was developing the system.

Therefore, instead of looking for systems on the forums, try to find a good trader and ask him to teach you. But make sure that he is a real trader because there are many people who introduce themselves as good and great traders, but they have never been profitable in reality. So be careful.

3. After finding a good and reliable trading system which is taught by an experienced forex trader, you need to try the trading system on the demo account at least for few months. You should forget that you are demo trading and you should treat your demo account as a live account. Only in this case you can built the confidence that you need for live trading. Otherwise you will do nothing but developing bad trading habits. When you succeed to trade profitably for few months consecutively, you can open a live account and start trading with a small amount of money. You need to rebuild your confidence with your live account and to do that, you have to trade with a small amount of money and when you succeed to trade profitably for few months, you can increase the amount of the money that you trade.

You are there

If you follow the above stages, you will see that fear and greed can never interfere in your trading, because you will not give them any chance to do this. Greed can not take the control, because you do not start with trading a lot of money and fear will not show up because you do not lose your confidence because of losing a lot of money.
I would say that greed is more harmful personally.
 

Dora_WalletInvestor

Active Trader
Aug 17, 2020
301
46
44
Exactly. It is neither realistic nor healthy, I believe. One can repress their emotions only for so long before they burn out and then the consequences are pretty serious, for their trading and for their health, I believe.
Definitely, repressing your emotions always comes with a price later in life.
 

Lacquer

Banned
Dec 13, 2021
18
2
4
29
Both types of emotions are bad in trading, but the question is why do traders experience such emotions? If a trader has gone through the charts, devised a smart trading strategy, and knows the right entry and exit points in the trade, then he/she won’t show either of those emotions. Such emotions engulf only those traders who trade without any plan.
 

e_abrams

Active Trader
Dec 11, 2020
451
31
39
41
It's just human nature to want things and to fear of the unknown that may prevent us from getting these things.
 
May 13, 2023
116
14
24
40
I think it really depends on the person and the situation. Sometimes being too scared can stop someone from making good decisions, while other times being too greedy can make them take big risks that end up causing problems. Both can be bad if they're not handled carefully.
 

Amy4

Trader
Mar 15, 2023
30
6
19
29
In my trading journey so far, I've seen both fear and greed wreak havoc in different ways. Greed can lead you to overextend, ignore risk management, and ultimately face significant losses. Fear, on the other hand, might prevent you from taking calculated risks, leading to missed opportunities. If I had to choose, I'd say greed is more harmful because it blinds you to the realities of the market, pushing you to make impulsive decisions. Both emotions need to be kept in check for balanced, successful trading.
 
Feb 18, 2024
9
2
4
35
I believe they both have an equally significant impact, making it difficult to determine which is more harmful. A great trader must be capable of managing and controlling both of them.
 

Ara

Trader
Apr 24, 2023
112
19
19
34
Both fear and greed are harmful in trading, but greed can lead to riskier decisions and potentially bigger losses. It's important to maintain balance and discipline.
 
  • 👍
Reactions: Thaddeus Finch
Feb 18, 2024
9
2
4
35
Both fear and greed are harmful in trading, but greed can lead to riskier decisions and potentially bigger losses. It's important to maintain balance and discipline.
I do agree with you and sometimes think greed is worse, but I have a friend who has fear and is almost always scared of taking a position and thinks it is risky, and he rarely enters the trade. As a result, he doesn't see any outcomes or profits.
 

Ara

Trader
Apr 24, 2023
112
19
19
34
totallyI do agree with you and sometimes think greed is worse, but I have a friend who has fear and is almost always scared of taking a position and thinks it is risky, and he rarely enters the trade. As a result, he doesn't see any outcomes or profits.

Totally get what you mean. Fear can definitely keep your friend stuck and miss out, just like greed can push too far. Both extremes aren't great. It's all about that balance and keeping emotions in check to make smart moves.
 
  • 👍
Reactions: Thaddeus Finch