Sunk cost: holding a trade just to get back to break-even

[Amanhasnoname]

A position goes against the plan. It's still open, now a few pips under water, and the thought arises: just wait until it comes back to the entry, then close.

That thought is sunk cost thinking. The loss exists whether the position is closed or not. The only relevant question is whether holding is better than closing, given current information.

Waiting for break-even also changes the shape of results. Losses grow because exits are delayed, wins get capped because they're closed at the first sign of profit, and the average loss ends up larger than the average win.

The antidote is a rule: the exit is determined by the original invalidation level or a time limit, not by where the entry was.

Time stops are useful for scalps. If a trade hasn't moved in the expected direction within a set number of minutes, it's closed, regardless of price.

Time-based exits make this concrete. If a setup normally works within three minutes, a position still sitting flat after five is telling something, and closing it frees attention and margin for the next real opportunity instead of babysitting a dead one.

How often do your losing trades turn into long holds?