Averaging Down Here’s What Smart Traders Actually Do SM
📊 “Do you ever average down on a losing trade?”
Dr. David Paul gives a candid answer — and uses a surprisingly relatable analogy involving beer and chocolate biscuits to explain why he avoids it.
In this video from ComLucro, Dr. Paul discusses the discipline of trading, how some pros average into positions, and why risk per trade should never exceed 0.5% — no matter how you split your entries.
🎯 Learn:
Why averaging down can be a dangerous habit
How pro traders use entry scaling without breaking discipline
The key difference between averaging in and averaging down
Smart entry methods based on time and price
📈 Recommended Tool:
TradingView – https://www.tradingview.com/?aff_id=119375
🌐 Com Lucro – https://www.comlucro.com.br/
📺 YouTube – Com Lucro – https://comlucro.com.br/youtube
#DavidPaul #TradingDiscipline #RiskManagement #AveragingDown #TradingMistakes #ForexTrading #TradingMindset #SmartEntries #PositionSizing #ComLucro
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Do you ever average down on the losing trade?
No, not for years. And that was one of the
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things that I resolved to do when I sat on
that mountain outside Johannesburg. However,
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I know people who do, but they do it in a
very careful way. They say that it’s very,
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very difficult, especially in the forex
market, to get their entry spot on.
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So they will average into a trade. So rather than
risking that half a percent on one trade, they’ll
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go in at a quarter. And then, if the market gives
them a better level, they’ll go in at a quarter
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again. But they then define that the total risk on
that trade should not be more than half a percent.
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So, they split their entries mathematically.
That is quite a good way to think about it.
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I don’t like it because it breaks the
discipline. It’s like going on a diet
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and just having one beer, okay? It just breaks
the discipline. I don’t know what you’re like,
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but, you know, it pretty
much sums up my day. Yeah.
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So one chocolate biscuit and you’re finished.
Okay, so, as far as I’m concerned, I don’t do
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that. But I know an awful lot of traders
who are exceptionally good traders that,
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in fact, split their entries. Some split their
entries based on price levels, some split their
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entries based on time. In other words, the
market pulls back, they’ll buy a little bit,
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and then, 3 or 4 hours later, if it hasn’t
moved, they’ll buy a little bit again.
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And they will split their entries based on time.
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But the trick is that the risk of all
of the positions must not be any more
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than that half a percent that I talked
about, although I don’t do that myself.
