MAXIMUM DRAWDOWN PERCENTAGE
Maximum Drawdown Percentage represents the largest peak-to-trough decline as a percentage of the peak price, providing a relative measure of loss.
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The psychology of trading refers to the emotional and psychological factors that influence a trader's decisions and behavior. In trading, emotions like fear, greed, and overconfidence can lead to impulsive decisions, affecting performance. Understanding the psychology of trading helps traders manage stress, avoid emotional decision-making, and stick to a disciplined strategy. Successful traders cultivate emotional resilience and self-control, helping them maintain a rational approach to navigating market fluctuations.