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Thread: Fear of missing out

  1. #1
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    Fear of missing out

    Hi, everybody.

    Today I want to tell about interesting psychological issue that traders face with that is called "Fear Of Missing Out" (FOMO)

    FOMO actually appears when one fears that everyone else is having more excitement and more rewarding experiences than you. Rapid growth of social networks had brought FOMO-effect in some people's life.

    People tend to check their email every 2 minutes, renew their page in facebook or twitter. Of course, those suffering from FOMO have smarphones to "keep in touch" with the news. Their ability to concentrate on their work decreases, their relationship also tend to decay.

    But destructive effect of FOMO in everyday life (when one can't stop checking his email) is slow, but when we are talking about "trading FOMO", it can easily lead to heavy overtrading and huge drawdown as a result.

    You can identify features of FOMO in your trading life with a simple check-list:



    1. Do I tend to place market orders most of the time instead of using limit orders?

    To rephrase: do you provide liquidity or consume it? It often distinguishes good trading habit from bad one. "Jumping in quickly" works in very limited set of setups and you should have very solid understanding of those setups. Example is momentum trading, this style requires to go with the price in some situations (instead of buying pullbacks). But as I have said, market conditions must be in your favor, good momentum trade can require 2-3 days of preparation.


    2. Am I searching for a "Home run"?

    By "Home run" I mean rapid and big market movement, that easiliy moves your equity curve forward.

    Traders, suffering from FOMO easiliy project market movements in future and tend to predict rather than to manage their positions. If you look at equity curve of consistently winning traders, you may notice that equity rapidly goes up in 25-30% of all accepted trades. Other trades tend to do small profit, to generate small loss or breakeven.
    It means that nobody really knows when a "home run" will appear.

    Great amount of work shoud be done in a process of filtering bad entries and preserving your capital.
    "First survive than prosper" - said Mario Puso's character Don Corleone. It's absolutely right when we are talking about trading.

    Best traders know that they can only project small price movements (usually next 3-4 bars), that allow to reduce their risk and let some profit run. Yet there are some trading styles like scalping when you don't need "home runs" to generate income.


    3. Do I lack patience?

    If you lack patience and know that, probably you should think about eliminating FOMO from you trading.

    Cure for that is first increased self-awareness, second - you should probably lower stress and pressure from your trading.
    Maybe you are risking too much or you lack some basic needs (want more money quickly).
    Seriously consider lowering that pressure. Any action that helps is good here.


    Do you have FOMO and how you try to eliminate it?

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    Last edited by Value trader; 08-07-2013 at 09:23 PM.

  2. #1461
    Trader Doge's Avatar
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    We can successfully handle the fear of missing out with trading very small volumes every time we get to feel this fear, but conditions are not right according to our strategy (we need to have one, even if its some very broad rules). It's important to acknowledge the educating purpose of this tactic - we open these trades so we see what will happen after the situation in question. After we experience a similar thing a few times we will know what happens and there will be no more need to open these trades. The fear will be gone.

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    Wow. Much Forex. So Monies. Very Opportunity.Many Trade. So Amazed. Wow.

  3. #1462
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    I think the fear is the worst thing ever. And the only way to stop feeling fear - is to try more and more, and in that way you will see and understand that every attempt will give you more chances to be a winner in certain situations. It wasn't easy for me to take cbd oil in every life situation, that's why for today I prefer to eat cbd gummies (from here: https://purekana.com/collections/cbd-gummies/), cause manufacturer PureKana makes perfect stuff.

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    Last edited by fosterQZ; 07-25-2019 at 09:09 AM.

  4. #1463
    Trader J_C_Anderson's Avatar
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    FOMO is quite popular among Forex traders. In most of the cases it is cause by previous mistakes and their wrong analysis. It isvery important for each trader to develop a set of rules that would be applicable for the situations that may occur during trading.
    For sure, trader should be open-minded to be able to benefit from new trading opportunities, but at the same time it is necessary to act strictly in accordance with the rules of trading system that confirmed its efficiency.

    By the way, sometimes it is better to use market orders because you can miss a great trade trying to get a position for a bit lower price.

    One of the most common things caused by FOMO is looking for unusual trading opportunity after missing one. It happens when trader just missed a huge movement and wants to participate in the next one. Of course, it is normal for the trader to look for the trades with best risk-reward ratio, but sometimes it turns into opening new positions based just on hope and belief without any strategy or reasonable idea. This approach could lead to substantial losses if the trader wouldn`t be able to deal with such emotions. The best solution would be to take a rest and perform proper analysis of market situation to develop detailed rules that would be useful in such situations.

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  5. #1464
    Trader DONRJ's Avatar
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    with all my respect to all opinion i prefer get SL about Point whenever whatever happening, cuz no one can be certin 100%

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