Overtrading

Trader Psychology

More trades, not more edge

Overtrading means taking far more trades than your actual edge produces, often out of boredom or a need to always be in a position. More trades doesn't mean more profit, it often means more fees and more mistakes.

Diluting the good setups

A trader who takes twenty low-quality trades a day dilutes their few genuinely good setups with a flood of mediocre ones, and the mediocre ones drag the overall results down.

Zero is a valid number

A simple daily cap, like a maximum of one to two setups a day, forces selectivity. If nothing qualifies, the correct number of trades that day is zero.