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EMERGENCY FUND

A set-aside expense fund keeps you from closing positions at the wrong time.

Published by The Retail Trader · JUL 31, 2026 · Trading Psychology

Emergency Fund — A fund set aside for expenses, so that you never have to close a position at the wrong time.

WHERE THIS FITS IN

This term comes under Trading Psychology, in the section "Relationship with Money". Most of the psychology comes from the condition of your money, not from your chart:

RELATED TERMS TO READ

Other terms in this group — understanding them together is more useful:
• Risk Capital
• Scared Money
• Borrowed Capital
• Position Size vs Neend
• Income Expectation
• Opportunity Cost
• Comparison Trap
• Lifestyle Creep

To read the entire group and all its examples in one place, see the journal "TRADING PSYCHOLOGY: Words from the Mind" - this term has been taken from there.

This entry is for educational purposes only and is not a recommendation to buy or sell. Exchanges change charges, margins, lot sizes and expiry rules from time to time, so verify any figures with your broker or exchange.

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