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I wait until my target is hit, but I have more than one. Your "target" has a certain probability of being hit (being known or unknown to you). It's amazing to watch newer traders just throw targets out there off the top of their head. There is no "one rule" for what your target(s) should be. It depends on your system/setup and risk tolerance. I take partial positions off at the higher probability targets so I can concentrate on reading the markets for the lower probability ones. For me, it's not so much about fear but more on the simple concept of capital conservation. In order to be a successful trader you MUST make money. It's very black and white (or red and green  ). Remember, psychology is a BIG part of trading and scaling out (depending on your system of course) can help a lot in certain situations.
Just like picking your targets for all in and all out...you can pick wrong scale-out areas that WILL lower your PnL some. It's easy to look back and say "if only I didn't scale out". However, if you didn't scale out and take a small win on that trade would you have had the ability to jump right back in for that next trade? It's a big mind game and visually backtesting your PnL can give you false perceptions. |
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This is a very good post from the "psych" aspect. True in all regards.