How to Conquer Your Fear of Losing Money | Bulls on Wall Street

How to Conquer Your Fear of Losing Money

Who likes losing money. Few professions put you in a scenario where you actually lose money by showing up to work. But trading can offer freedom and scalability of income that no other profession can offer. Fear of losing money is a natural response. In life, any worthwhile achievement doesn’t come without risk.

In order to become a successful trader you have to reprogram your brain and your beliefs about losing money. In yesterday’s blog, we introduced you to the 3 types of trading fear that you will encounter. In today’s article, we will show you how to conquer your fear of losing money, which holds back so many traders from being consistently profitable:  

Think Like a Casino

fear of losing money phobia

Every winning trader thinks like a casino. They don’t win 100% of the time on every blackjack hand, slots, or craps. But they have a statistical edge and know that in the long run (over large enough sample size) they will always make money. That’s why a casino is a profitable business!

Your trading business needs to be the same way. You need to have a backtested system with a positive expectancy, which means it will make you money with a large enough sample size (learn more about how to build a trading system with our free trading kit here).

Casinos know that losing money on 1 hand of blackjack doesn’t mean their business is a failure. It is a cost of doing business. They know that in order to make money, they just need enough people in the casino to cancel out the people that actually make money.

Losing Money = Business Expense

 Think of the money you risk on every trade as a necessary business expense. A grocery store has to buy food in order to sell it and make a profit. The only way you can be in winning trades is by risking money. You have to risk it to get the biscuit! Once you accept this, losing money won’t create fear in you.

 Once your trading setups appear, you should be EAGER to risk the money in order to find out if it will be a winner. You know that putting on this type of risk will make you money in the long run and that it is your duty to put on the risk in order to find out. 

Study your trades and charts every day. You need to know the exact setups and scenarios you have an edge and know what to risk your hard earn money on. You need to train your brain to recognize and pounce on the trading opportunities you have an edge on. 

Trade Money You Can Afford to Lose

Are you scared when you pay $1 for a pack of gum? Do you feel pain when you part with that $1? All of your fear about losing money stems from the quantity of money you are parting with, relative to your net worth. When you drop $1000 on a bottle of champagne at a club, it’s a very different set of emotions for most people. 

Put this in the trading context. You need to be risking enough capital to make the time you put into the trade worthwhile, but not large enough that you become emotional with the parting of the capital you are risking. 

When all of your net worth is being risked on one trade, I don’t see how you don’t become afraid of losing that money. Your lifestyle should not change because of the outcome of 1 trade. Most trades you should be risking a small portion of your trading account, ideally no more than 1% of the total account size.

We’ve seen a ton of our students actually make MORE money by risking less, because they are less fearful, and make better trading decisions as a result. When you remove emotional attachment to money, you take a HUGE step towards becoming a consistently profitable trader. 


There are 3 simple ways to conquer your fear of losing money:

  1. Have a defined trading system with an edge
  2. Risk money you can afford to lose 
  3. View the money you risk as a business expense

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