Last week we discussed a simple technique that helps keep my mindset focused on the price action, rather than on my P&L, after suffering a trade loss.

<image: Pre-Accept All Possible Losses>

You'll find last week's article here if you missed it –

So this week… I want to go a little deeper.

Because there is something that needs to be in place BEFORE this technique is applied, if I really want to gain maximum benefit from its use.

A belief system.

At the core of my approach to engaging and acting in the markets.

And that is…

Accept all possible losses before entering the battle!

We have talked about pre-acceptance of individual trade risk before –

But today's idea goes well beyond that.

It is about ALL possible losses.

It is about establishing a mindset during pre-session preparation, before the market is open, where I am completely at ease with the idea of MULTIPLE trade losses and closing out the day at the maximum loss limit.

Complete acceptance!

Of all possible losses.

This is the first of six parts of Richard McCall's ACTION Plan, from "The Way of the Warrior-Trader", for developing an effective performance mindset. I highly recommend this book if you're into the idea of applying lessons from samurai philosophy to the trading arena. And of course to get the final five parts of his ACTION Plan.

Accept all possible losses before entering the battle!

In fact, I take it a little beyond acceptance.


It's like acknowledging that the default future is for a full session loss… decreed by the Trading Gods as inevitable unless I can demonstrate sufficient skill to prevent it.

Most traders operate like this:

<image: Pre-Accept All Possible Losses>

And the result is performance anxiety, doubt, hesitation, FOMO and all myriad of other problems.

My plan is to operate like this:

<image: Pre-Accept All Possible Losses>

This doesn't mean I want to end in drawdown. I will do everything in my power to defy the Trading Gods and finish the day somewhere to the right of that line.

It simply means that I'm absolutely fine with the day ending at a complete loss. I've pre-considered the outcome. And accepted that this is something I can manage. Something I can survive. And something that I can overcome.

<image: Pre-Accept All Possible Losses>

Maybe it's just me? Maybe I'm wired a bit strange?

But I don't think so.

If you struggle with the idea of loss, maybe you need to reconsider your relationship to risk. And maybe you could give this a try. I believe it helps me. Maybe it will help you too.

Pre-session… I cast my mind forward several hours and imagine a full session loss. How does that feel? Can I accept that?

If not, then I have no business trading today.

But if I can accept this outcome, then it's game on. Because while the Trading Gods might be planning a full session loss, I'll be damned if I'm going to go there without a fight.

Happy trading,

Lance Beggs



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  1. Important information for anyone considering purchasing the book discussed above:

    Extract from an email I received:

    – – –

    I look forward to your weekly posts and I wanted to mention something about your most recent one. You had recommended Richard McCall’s book which led me to look into him a bit more. In case you’re not aware, the CFTC charged him back in 2006, from their complaint, “the website identified McCall as “Dr. Richard McCall, PhD” and represented that he is a former clinical psychologist… in fact, McCall graduated high school in 1972 and thereafter received no undergraduate or graduate degree from any educational institution… McCall claimed on his website that he was an experienced futures trader… in fact, McCall actually traded futures for the first time for about one year beginning in 2003, his account was consistently unprofitable, and he knew he had no reasonable basis to claim his trading results were ranked among the top 5% of traders worldwide.”

    Although it doesn’t mean that the concepts in his book are invalid, he does seem to be a FURU of the highest order.

    Link to the complaint on the CFTC’s website is:

    I just wanted to point this out to you since you made a recommendation for his book, apologies if you already knew about this. Thank you again for all that you do, and I hope that you enjoy the rest of your weekend with your family.

    – – –

    Extract from my response:

    Yes, I was aware of this. I spent quite some time unsure of whether to mention this book, for exactly this reason, but at some point decided that I should. I actually really enjoyed the book and got quite a lot of value from his thoughts on the parallels between a peak performance mindset and that of the samurai warrior.

    The book itself is not attempting to teach trading. It’s simply mindset. So while it is disappointing that the author did not provide full disclosure about his failure to actually trade, it’s perhaps not relevant to the contents of the book anyway.

    And it’s been a few years since I last read it, but I don’t recall any discussion of qualification as a clinical psychologist. But again, even if there was, the material within does not attempt to make use of any clinical psychology methods.

    So while his decision making was clearly poor and his integrity no doubt called into question, I feel the material in this particular book was worthwhile. Given his martial arts background I am happy to trust him with this information. Anything beyond the idea of trading lessons found within eastern philosophy, he is perhaps not the person to go to for that information.

    Perhaps in my case I should have added a note to this effect at the end of the article, so that anyone considering getting the book might take this information into consideration. I think I’ll do that in future.

    And I think perhaps it’s a good idea if I add our email discussion to the current article comments section.

  2. Hi Lance,
    This might be the best article I’ve read so far. Expect and accept the full session loss really does make a difference, it removes the fear of loosing a trade, or second guessing too much. If you expect a loss, you can’t be disappointed or caught in a surprise!

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