One of the reasons new traders take unnecessary risk is because their expectations are not realistic. They may think that aggressive trading will help them earn a return on their investment more quickly. However, the best traders make steady returns. Setting realistic goals and maintaining a conservative approach is the right way to start trading.
Being realistic goes hand in hand with admitting when you are wrong. It is essential to exit a position quickly when it becomes clear that you have made a bad trade. It is a natural human reaction to attempt to turn a bad situation into a good one, however, with Forex trading, it is a mistake.
With this mindset, you can prevent greed coming into the equation, which can lead you into making poor trading decisions. Trading is not about opening a winning trade every minute or so, it is about opening the right trades at the right time, and closing such trades prematurely if the situation requires it.