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Trading fallacies

The seven patterns thatcost traders money — and how to break free from them.

These aren't random mistakes — they're predictable responses to emotional pressure. Each one feels completely rational in the moment. That's what makes them dangerous, and what makes them so hard to self-diagnose.

Panic sell

Closing a position early — before your stop-loss triggers or your plan says to exit — because the trade is moving against you and the discomfort becomes unbearable.

Why it feels right

When a trade goes red, every instinct tells you to stop the pain. Getting out feels like control, like you're being responsible rather than stubborn. The relief is immediate.

Why it costs you

Your stop-loss isn't arbitrary — it marks where your thesis is wrong. Exiting before it means trading on emotion, not plan. You start taking losses at random points instead of planned ones, which makes your risk-to-reward impossible to manage. Across a full batch, consistent panic selling means your losses aren't capped — they're just unpredictable.

FOMO buy

Entering a trade after the move has already started, because you don't want to miss further gains. You weren't in it — then it moved — and now you're chasing it.

Why it feels right

The instrument is clearly going up. You can see it. Getting in 'a bit late' feels better than missing the move entirely. The momentum feels like confirmation that you're right.

Why it costs you

When you chase price, your entry is worse, your stop has to be wider or placed at an illogical level, and your risk-to-reward collapses. You're buying at or near the peak of the impulse — often right before the pullback. The trader who entered at the original level has cushion; you have none. FOMO entries consistently underperform the setup they're based on.

Revenge trading

After a loss, taking a new trade quickly — often larger — to win back what was just lost. The trade is driven by the need to recover, not by a genuine setup.

Why it feels right

The loss feels wrong. Unfair. Getting back to breakeven feels like correcting an injustice. Sitting on the sidelines feels passive and painful when you're in the red.

Why it costs you

Decisions made in this state are not analytical — they're emotional. You're not evaluating the setup; you're evaluating how it feels to take the trade. Revenge trades frequently violate multiple rules at once: wrong size, poor setup, no defined exit. They convert a single controlled loss into a sequence of increasingly desperate ones.

Holding losers

Refusing to exit a trade that has hit or passed your planned stop-loss, because you believe it will recover. The position stays open; the loss stays 'unrealised'.

Why it feels right

A loss only becomes real when you close it. As long as the position is open, there's still hope. The brain treats unrealised losses very differently from realised ones — locking in a loss feels acutely painful in a way that holding a red position doesn't.

Why it costs you

Your stop-loss marks the point where your trade thesis is invalid. Holding past it turns a planned small loss into an unplanned large one. In leveraged instruments — CFDs, spreadbets — this can accelerate to margin calls. Across a batch, a handful of held losers can destroy an otherwise profitable win rate. The maths become irreparable: no entry strategy survives if losses are uncapped.

Cutting winners

Closing a profitable trade well before your target — often at the first sign of a small gain — out of fear it will reverse and become a loss.

Why it feels right

A profit is a profit. Taking money off the table feels prudent and disciplined. Watching a winner reverse into a loser is one of the worst feelings in trading, and cutting early seems to prevent exactly that.

Why it costs you

This destroys your risk-to-reward ratio silently. If you're risking £100 to make £300 but consistently exit at £80, your effective R:R is 0.8:1 — a long-run loser even with a decent win rate. The asymmetry that makes a trading edge work requires letting winners run. Systematically cutting them means no strategy is viable, regardless of how good your entries are.

Oversized position

Taking a position larger than your risk management rules allow — typically too large a percentage of your account on a single trade — because you have unusually high conviction.

Why it feels right

High conviction often accompanies oversized positions. If you're 'really sure' about a trade, betting more seems logical. The potential upside feels proportionate to your confidence.

Why it costs you

Conviction is not correlated with outcome. Even high-probability setups fail regularly. When an oversized position goes wrong, the drawdown is disproportionate: a normal 2R loss on a 10% position is a 20% account loss from a single trade. This disrupts your ability to think clearly on every subsequent trade, and one oversized loss can erase weeks of disciplined gains. Risk management exists precisely for the trades you feel best about.

DCA sequence

Adding more capital to a losing position — averaging down — to reduce the average entry price, without this being part of a pre-planned, pre-sized strategy.

Why it feels right

If you liked the trade at £10, surely it's even better at £8? You're getting in cheaper. The thesis is the same. This reasoning feels mathematically sound, especially if you still believe in the underlying move.

Why it costs you

Planned DCA — where entries, levels, and total risk are defined before the first position is opened — is a legitimate strategy. Unplanned DCA is how small losses become catastrophic ones. Each time you add to a loser, you increase exposure at the exact point where the market is telling you you're wrong. Your original risk calculation is now meaningless, and if the trade continues against you — which instruments moving aggressively against you often do — losses compound rapidly.

The core idea

We roast your trades so you stop repeating mistakes.

Most beginner traders measure themselves by P&L. It feels obvious — green is good, red is bad. But P&L in the short term is heavily influenced by luck, and optimising for it trains exactly the wrong habits.

A trader who follows a poor process and gets lucky is reinforcing dangerous behaviour. A trader who follows a disciplined process and takes a loss is learning. Over hundreds of trades, only one of these traders improves.

Roast My Trades shifts the feedback signal. Instead of rewarding outcomes, it rewards process quality. Over time, that reframe changes how you think before, during, and after every trade.

P&L focus

Win = good trade. Loss = bad trade. You hold losers waiting for recovery, cut winners early to lock in green. You trade more after a big win. You revenge trade after a big loss. Your equity curve is erratic.

Process focus

A well-executed loss is filed as a Good trade. A lucky win on a reckless entry is flagged as Bad. You improve your process systematically. Over time your edge compounds.

Results in minutes

One credit per analysis, any basket size

Market context included

Historical events for your trade dates

Not financial advice

Process review only

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