In a market that drops from 100 to 50, many people can't resist cutting losses at 80, accepting a 20% loss as an acceptable exit point. But here's the problem—if you stop at 80 with a 20% loss, while others hold on and buy the dip at 50 to double their position, the subsequent differences in outcomes are astonishing.

Let's do the math. After cutting at 80 and losing 20%, when the price rises back to 80, you need to gain 60% to recover that initial loss, making your total return break even. If it finally rises to 100, even if you buy back now, you can only make a 50% profit. After deducting the previous loss, your net profit is 30%.

Now, consider another scenario. You didn't panic at the bottom of 50 but instead took the opportunity to buy in. When the price rises to 80, you've already gained 60%. If it eventually surges to 100, that's a doubling of your investment. The difference is clear.

The key is that many people lack the courage to cut losses decisively or the bravery to buy the dip. The result is counterproductive—hesitating when they should sell, and lacking the guts to seize cheap opportunities. By the time they break even, others have already made full profits at the bottom. Playing this way, whether in spot trading or futures, how can you compete with those who have strong execution?