Here is an extremely key psychological point:

The characteristics and strengths we need to reduce risk are very different from the characteristics and strengths we need to maximize profits. We must treat them as different skill sets and improve them independently.

Risk reduction requires the virtues of vigilance and alertness: the ability to be careful, understand the risks, and know how to keep the risks under control and acceptable.


Profit maximization lies in willpower: the ability to hold onto a goal in the face of uncertainty.

Mark's conclusion after years of running the fund is that, for professional traders, caution is a natural virtue. If they weren't careful, they wouldn't be a professional trader! But accepting uncertainty is another story. When we observe our open position continuously, it is easy to see that something is wrong and to accept an exit earlier than intended.


There is a proverb: not planning is planning to fail. If clear and achievable goals are not set before entering a command, there is no reason to try to stick around and overcome the difficulty of achieving them. The real problem is not escaping profit too soon. The main problem is not knowing how to set clear and possible take-profit goals to give us more motivation to keep the command. That is the problem many of us encounter in life, as well as in the market.