By: Katie Gomez

We’ve all known someone who stayed too long in a toxic relationship, ignoring every warning sign: unanswered texts, broken promises, constant excuses. Yet they stay, hoping things will magically improve. Traders do the same with poor positions and risky habits. With Valentine’s Day approaching, it’s time to assess what deserves your commitment—in love and your portfolio. Trading red flags are as obvious in hindsight as dating red flags, but easy to ignore in the moment. Ignoring red flags in dating wastes time and energy; in trading, it wastes money and opportunities. Here’s a guide to spotting warnings before they cost you, whether it’s a bad relationship or a bad trade. Consider this your intervention.

The Honeymoon Phase: When Good Trades Go Bad

Every trade starts like a new relationship—initial attraction when the setup looks perfect, fundamentals align, and technicals confirm your thesis. Early excitement grows as the first moves validate your analysis and boost your confidence. You size up, maybe add to the position, thinking, “This is the one.” But things change: warnings appear (minor support breaks, declining volume, weakening momentum), but you dismiss them and stick to your original story. Excuses follow: “It’s a temporary pullback,” or “The market doesn’t understand this company yet.” Like in dating, hope keeps you stuck, turning “they’ll change” into “it’ll bounce back.” That hope, though comforting, can become your costliest emotion.

Red Flag #1: They Keep Breaking Promises

In dating, it’s the “I’ll call you tomorrow” that turns into radio silence, or the “next time” never materializes—a pattern of saying one thing and doing another. In trading, the empty promises sound eerily familiar:

• Companies that consistently miss earnings guidance
• Management teams that over-promise and under-deliver
• The dreaded “this quarter will be the turnaround” announcement for the third consecutive time, while revised guidance keeps getting worse.

We ignore the signs out of hope, sunk cost, or fear of admitting we were wrong. But past behavior predicts future behavior, and the chart confirms the story. If a company repeatedly breaks promises, believe them—don’t trust a hopeful narrative after management misses guidance three times. Stop and reassess the position objectively. Hope is not a strategy.

Red Flag #2: You’re Making Excuses for Their Behavior

In dating, it’s defending behavior to friends; in trading, it’s justifying to yourself: “the market doesn’t understand this company,” “it’s just sector rotation,” or “everyone’s wrong but me.” If you’re working hard to defend a position, it’s probably indefensible. Excuses help us avoid accountability, thanks to confirmation bias, cognitive dissonance, and ego. Warning signs include: your thesis changing to fit bad news, spending more time justifying your position than why you entered, and avoiding discussion with other traders. If you’re making excuses, ask: “Would I enter this trade today with this knowledge?” If not, act on it.

Red Flag #3: Obsession

In dating, it’s checking social media and obsessing over their actions. In trading, it’s checking your position constantly, waking at 3 AM to watch futures, being unable to focus, and feeling anxiety each time you log on. This stress ruins decision-making and drains mental energy you could use elsewhere, not to mention the toll of lost sleep and anxiety. This toxic cycle—bad position causes stress, stress leads to poor decisions, which worsen the position—feeds on itself. Toxic trades drain you like toxic relationships. Healthy monitoring means sticking to a plan; unhealthy compulsion is an emotional rollercoaster. If you’re obsessing or anxious, the trade is too large for your risk tolerance—reduce or exit now.

Red Flag #4: You’re Hiding It from Others

In dating, it’s hiding how bad things are from friends and family. In trading, it’s omitting losing trades from your journal, hiding positions from accountability partners, steering conversations away from poor performance, and never mentioning a big loss. Secrecy matters: shame shows you know something’s wrong. Hiding losses doesn’t help; transparency breeds accountability. The best traders share mistakes to learn. If you’re hiding a trade or loss from those you trust, your subconscious is telling you to get out. Listen.

Red Flag #5: The Fundamentals Have Changed

In dating, it’s discovering you want different things (like kids), seeing them develop problems, realizing your values clash, or seeing they’ve changed. Traders similarly ignore when their original reason for a trade disappears:

• The company loses its key competitive advantage.
• A management scandal erupts, or leadership departs.
• The business model gets disrupted by a competitor or new technology.
• Regulatory changes invalidate the entire opportunity you bought into.

The cognitive trap is: “I entered for reason X, but stayed for reason Y,” moving goalposts to justify staying in a bad position. The truth: when the original thesis breaks, exit. Write your thesis before entering every trade. If that thesis fails—the dividend is cut, growth stalls, product launch fails—exit automatically, don’t rationalize. Staying after fundamentals change isn’t loyalty; it’s denial.

Self-Respect in Trading and Dating

Valentine’s Day is ultimately about self-love and self-respect, and the common thread running through all these red flags is simple: ignoring what you know deep down. In dating and trading alike, staying in bad situations doesn’t make them better—it just delays the inevitable while compounding the damage. The moment we take our heads out of the sand and see what’s happening, we can break these toxic cycles. Our ability to walk away when something isn’t working is not a weakness; it’s wisdom. Your capital, like your heart, deserves to be invested in opportunities worthy of it. Red flags exist to protect you, but only if you actually pay attention to them instead of explaining them away. This Valentine’s Day, commit to one thing: honoring the red flags instead of rationalizing them. The best gift you can give yourself is the courage to walk away from what isn’t serving you—whether it’s a toxic relationship or a toxic trade that’s bleeding your account. Your future self will thank you for the losses you cut today, because every dollar and every ounce of emotional energy you free up can be redirected toward opportunities that actually deserve your commitment. Need an accountability partner? Visit Trade Ideas today and break free from your toxic stock relationships.