The Importance of Knowing Your Worst-Case Trading Day

Before trading, I want to know how much I'm prepared to lose if the session goes badly.

That means defining a daily loss limit, choosing appropriate position sizes, and understanding the possibility of slippage.

A stop order doesn't guarantee an exact fill price in every market condition.

Planning for adverse outcomes helps me avoid making decisions based on the assumption that everything will execute perfectly.

A realistic risk plan considers what can go wrong—not just what I hope will happen.