Psychological risk is the gap between the written plan and real behaviour under pressure. On the Gold path it is measured and managed as an integral part of risk management.
Gold path — Module: Advanced risk control. Part of gold-path.
Who this is for
- Anyone who changes size after a few consecutive trades.
- Anyone who struggles to respect stops and limits in emotional phases.
- Anyone who wants to keep discipline during drawdown periods.
Prerequisites — Complete silver-path first (min.: max-daily-risk, max-drawdown, robustness, backtest). Foundation: bronze-path.
In plain terms — You do not lose only to the market: you can lose from how you react to the market. If emotion drives size, real risk exceeds what was planned.
Operational management
Define behavioural triggers: overtrading, revenge, fear of entering. Link each trigger to a standard response decided in advance. Build mandatory pauses after relevant emotional events. Monitor discipline metrics alongside performance metrics. Use periodic review to spot recurring patterns.
Example — After three consecutive losses you feel urgency to recover. The protocol imposes a 20-minute pause and halved size. You avoid the impulsive trade and keep risk within limits.
Card
- Goal: protect decision process under stress.
- Key inputs: emotional journal, rule adherence, size deviations.
- Warning sign: rising frequency of out-of-plan trades.
- Typical mistake: treating the topic as "motivation" rather than risk.
- Practical action: psychological triggers codified in the playbook.