There has been a question that has always troubled traders—why do people who understand risk management still experience failures?

I found that the root cause for most people stumbling is a common flaw: a sense of overconfidence.

Driving at a speed limit of 80 but insisting on going 100, running red lights as if they were green—this is equivalent to trading against the market, fighting against the trend, and stacking leverage. Honestly, doing this a few times might even bring some gains, and the thrill is as addictive as winning in gambling. But here’s the problem: patterns are patterns, and eventually, you have to pay the price. Whether it’s a car crash, an account explosion, or even more serious consequences, all stem from this overconfidence mentality.

Conversely, following the rules—sticking to 80 in a 80 zone, stopping at red lights, going at green lights, trading with a small position, following the trend, and using strict stop-losses—may seem ordinary, but it provides real safety. With safety, you can make rational next steps. Don’t force yourself into unfamiliar markets, let go of opportunities you can’t grasp—this isn’t cowardice, it’s the basic skill to survive longer.

The key is one word: Rationality. Don’t let emotions and greed hijack your brain.