Try to Lose Money Experiment
Has anyone done this yet? I'm sure it's crossed people's minds before or been completed.
This type of experiment could shed excellent insights into an individual's own plogy and when done by numerous individuals we can learn about some universal problems in our trading plogy. We would do this on a demo account, though as with lab experiments we'd need to carefully correlate the results of fact. Though the fact that no true worth of money is riding this is likely to make the experiment more powerful in describing trading plogy!
I guess the easiest way to lose money is by the spread, so that will need not to count. We can invert the spread or not count it at all.
We would also need to split testers by their actual trading records. Individuals who lose money due to feeble plogy, poor risk management, and poor comprehension of the market would need to be distinct from those who have been always successful. We'll say the former is Group A along with the latter is Group B. We might also have a third group of those who have never traded at all.
My hypothesis is this: When Group A tries to lose money, most will have the ability to lose money! When Group B tries to lose money, they'll likewise have the ability to lose money!
If this hypothesis is proved true, then it would surely be great proof in maintaining the power of plogy in gambling. You'd believe it would be easy to reverse your losing methods and become successful, but of course it is not that easy exactly because plogy is so strong that we cannot conquer it merely with knowledge of it. Fears and needs are like intoxicants, you're not able to utilize your knowledge under their sway. It requires discipline, and methods of discipline, to conquer our fears and needs.
Procedure: I will see how fast I can blow a $50,000 demo account. I would need to differentiate whether or not I am going to use poor risk management or just attempt to make bad trades based on inverting a egy. I could easily take a humongous lot and shut it because it goes enough pips to cover an inverted spread and more in the wrong direction. But this is precisely what some people do if they attempt to win, so perhaps I need to allow my losses run! Hmm....
One test wont be enough, I will need to do this several times within a time period to truly see if I could always blow an account. I will think about a standards to write down my thoughts and feelings in addition to some emperical data. Then, at least for myself, I'll have the ability to understand how my plogy can hurt me.
Any inputs? Thanks
