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Loss
Financial loss resulting from a negative position or bad decision.
Beginner-friendly explanation
A loss is when you lose money in trading. It happens when you sell for less than you bought.
Example: You buy Bitcoin at $30,000 and sell at $28,000: you make a loss.
Intermediate-level insight
Managing losses is a pillar of trading. A controlled loss is planned (stop loss), while unmanaged loss can be catastrophic.
Example: A trader places a stop loss at -5% to limit loss on a trade.
Advanced perspective
Losses should be integrated into a statistical trading approach (positive expectancy). Analyzing losses helps identify structural errors: bad timing, poor risk management, ineffective strategy.
Example: After 100 trades, a trader analyzes their losses to adjust risk management.
Cryptocurrencies & Tokens
loss, financial loss, stop loss, risk management, trading mistake
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