A risk management process for a trading system is not just math but also includes human psychology. The psychology of execution is just as important to profitability as the trading dynamics of the entries and exits of a trading method. Humans have fear, greed, and egos and these elements can interfere with the process of trading the right position size, cutting a loss, and letting a winner run. The following are the dangers of risk that come from a trader’s psychology. 1. Believing too strongly in a trade can lead a trader to trade too big a position size when they think something must happen. Nothing is certain and ... (full story)