Failure hurts… but what if that’s actually your edge as a trader?
Tom Hougaard’s Best Loser Wins is basically a slap in the face to the usual “just learn more indicators” advice. The whole idea is simple but uncomfortable: your relationship with losing trades will decide how far you go in this game. Not your IQ. Not your fancy chart layout. Not the latest “holy grail” EA.
Most traders obsess over entries, strategies, secret patterns; they keep hunting for the next magic thing. Meanwhile, the tiny group of consistent winners quietly work on something completely different: how they think and how they respond to pain, fear, and uncertainty.
In this blog, we’ll break down the core message behind Best Loser Wins and how you can use its ideas to transform your trading mindset — without needing to become some emotionless robot.
Why “being a good loser” matters more than any strategy
One of the biggest ideas in the book is this:
Winners are not the traders who avoid losing. They’re the ones who can lose well.
Most traders treat a losing trade as a personal attack. Ego kicks in. You feel wrong, stupid, exposed. So what happens?
- You move stops.
- You revenge trade.
- You double the lot size to “get it back quickly.”
- You obsess over that single trade instead of the bigger picture.
Tom’s point is kinda brutal: the market doesn’t care about you. Your emotional reaction to loss is completely your responsibility. The 1% of traders who survive and thrive are those who train themselves to:
- Accept losses as normal business expenses.
- Stay calm enough to follow the plan, even after a hit.
- Keep risk small so a losing streak doesn’t break them mentally or financially.
You don’t need perfect technical knowledge. You need emotional stability when money is on the line.
Thinking in probabilities – not predictions
A huge mindset shift in Best Loser Wins is learning to think like a casino, not like a gambler.
Most traders act as if every setup has to win. They ask:
- “Will this trade work?”
- “Is this the top?”
- “Is this the bottom?”
The pros ask different questions:
- “Does this setup fit my edge?”
- “If I take this trade 100 times, does it make money overall?”
- “Is my risk small enough that a loss doesn’t matter much?”
When you think in probabilities:
- A losing trade isn’t a disaster; it’s just one outcome in a long series.
- You stop judging yourself on a single trade and start judging yourself on process.
- You can cut losers quickly because you’re not emotionally attached to “being right.”
Tom openly admits his technical analysis skills are “average at best.” What sets him apart is that he truly believes in the math of his edge. He doesn’t panic when a valid setup loses, because he knows the game is played over hundreds of trades, not five.
Why knowledge alone doesn’t save you
Most traders read tons of books, binge YouTube, buy courses, attend webinars… and still blow accounts.
Why? Coz information ≠ transformation.
Tom talks about bridging the gap between:
- What you know you should do
- What you actually do live, with money on the line
You already “know” you should:
- Use a stop loss
- Avoid over-leveraging
- Stick to your plan
- Not move your stop just because it “feels” wrong
But when the candles start flying and your trade goes into drawdown, knowledge disappears and emotion takes over. That’s the real battlefield – not the chart.
Your growth as a trader isn’t measured by how many patterns you can name. It’s measured by:
- How you behave after three losses in a row
- Whether you still follow your rules when you feel frustrated
- If you can sit out of the market when there is no clear setup
The true measure of progress is not what you know, but what you do with what you know. Sounds simple, but living it is hard.
Conditioning your mind to lose without breaking
One of the most powerful ideas in Best Loser Wins is conditioning.
Tom doesn’t just “cope” with losing. He has trained himself to:
- Lose without anxiety
- Lose without emotional chaos
- Lose without wanting to “get even” with the market
That doesn’t mean he likes losing. It means he has turned it into something neutral. Like paying rent. Unpleasant, but necessary for staying in the game.
You can start conditioning your own mind by:
1. Reducing the emotional size of your loss
If one losing trade can hurt your life, your lot size is too big. Simple.
Trade smaller. Make the monetary loss so small that your brain stops freaking out. Only then can you actually think logically.
2. Using pre-defined rules
Before entering:
- Decide where you’re wrong (stop loss)
- Decide how much you’re willing to lose
- Decide your exit conditions
Once you’re in the trade, your goal is not to “win.” Your goal is to execute the plan. Win or lose, a well-executed trade is a victory for your discipline.
3. Tracking emotional mistakes
Keep a trading journal, but don’t just log entries and exits. Add:
- How you felt before entering
- Why you broke your rules (if you did)
- What trigger pushed you into emotional trading
Over time you’ll see patterns: maybe you overtrade after a big win, or you revenge trade late at night, or you increase risk when you’re angry. That’s the real data that will change your career.
The brutal truth: you are the edge
The market conditions will change.
Strategies will stop working.
Indicators will lag.
News will surprise you.
The only constant is you.
That’s why Tom emphasizes self-knowledge over technical knowledge. When you deeply understand:
- What kind of risk you can truly tolerate
- How your brain reacts under pressure
- Your personal weaknesses (impatience, greed, fear of missing out, need to be right)
…you can design a trading approach that actually fits you instead of trying to copy someone else’s style.
Some traders do well with fast scalping, others need slow swing trades. Some can watch charts all day; others should automate or use EAs. There’s no “right” way – there’s only your way. But you’ll never find it if you keep running from your own psychology.
Practical takeaways from Best Loser Wins
Let’s turn the philosophy into a quick checklist you can actually use:
- Accept that losing is permanent.
Losses will never disappear. Your job is not to avoid them, but to manage and emotionally neutralize them. - Shrink your risk per trade.
If a single loss still feels like a punch in the stomach, lower your lot size. No shame in that. - Judge yourself on execution, not result.
A winning trade taken for the wrong reasons is a bad trade. A losing trade taken according to your plan is a good one. - Think in series, not in single trades.
Build your mindset around the next 50–100 trades, not the one open right now. - Train yourself to walk away.
After a big loss or emotional moment, step back. Break the loop of revenge trading before it even starts.
If you start applying even two or three of these points, you’re already closer to the 1% that Tom talks about.
Final thoughts – becoming the “best loser”
The title Best Loser Wins sounds funny at first, but it’s painfully accurate.
The ones who win in trading are:
- Comfortable with uncertainty
- Calm in the middle of losses
- Patient enough to let their edge play out
- Honest enough to look in the mirror and admit, “The problem is me, not the market.”
You don’t need to worship indicators. You don’t need to chase 100 different strategies. You need to build a mindset that can handle being wrong, again and again, without falling apart.
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