Happy New Year and let's make 2019 all it, we and our trading, can be...
Many traders tell me how much they love trading and yet they are in so much pain about it.
They believe if they can get over of their painful emotions, then they can become disciplined and patient, they will be able to become consistently profitable.
But it is not the emotions that are destructive to your trading success. It is your 'EMOTIONAL REACTIVITY' that is causing self-sabotaging behavioural patterns.
What is emotional reactivity? Following is a checklist with some examples. Time to get real and check how it shows up in your life! If you display any of these patterns of emotional reactivity in your day to day life, there is a high likelihood it will spill over into your trading life. Trading really is just a mirror of life in general.
Okay, so here we go:
-- Being 'hooked' by trading so that it is all that you think about (obsessive much? Addictive behaviour is not restricted to drinking a bottle of wine every night or guzzling a whole block of chocolate in one go - even if they say that you absorb less calories when eating a whole block :-p. Addictive behaviour can lead to overtrading and trying to 'force' trades)
-- Wanting trading to be easy and perfect, resenting any challenges that come up (did you read too many fairy tales? Interesting enough many of my successful traders lean in and strive on the challenge of it rather than trying to avoid it)
-- Feeling 'triggered' when things don't go your way (control freak much? Starting to roll on the floor and stamp your feet like a little kid?)
-- Feeling perpetually the victim and at the mercy of others / events (are you at the cause or at the effect of your life?)
-- Feeling overwhelmed too often and out of proportion to the event (having an unexpected expense is an inconvenience.. it is not life threatening! Neither is a trading loss...)
-- Blaming others (yes.. those mean twitter gurus who said you should go short when you knew the market is a long, and not to mention those pesky brokers.. lol)
-- Justifying why things are the way they are (I just want my trading to be simple! yeah.. me too .. but trading is not simple.. the world of finance is complex with many pieces of the puzzle to it and I love the challenge of it!)
-- Holding on to what is rather than looking for how to change (I can't possibly look at other markets, even if they may be more suitable for my personality and skillset. Intermarket Analysis? Too complicated... yet so useful to improve your trading results)
-- Being more worried about what people think than doing what needs to be done (If I take that loss then my wife will think I am wasting our money, and then ... )
-- Having to have the same things repeated to you, and be reminded of your responsibilities, and then resenting the reminders. If you are not responsible in other areas of your life, there is a high possibility you will not be responsible with your trading. (make a list of all the 'messes' in your life. A mess is like a lock on the gates to abundance, as in the back of your mind you will always be pre-occupied with it and so using up valuable brainpower)
-- Being dramatic, sulking, emotionally withdrawing (even though it gives a feeling of importance, the illusion of being in control and temporarily makes you feel better, you are doomed to missing out on the the trade that could have made all the losses back.. )
-- Expecting others to be endlessly patient with you
-- Being upset when someone stops trusting you, when you have not been trustworthy
-- Assuming your emotions are more important than anyone else's (no one understands me .. boohoo)
-- Discounting or being oblivious to how someone else may feel, esp when you let them down
-- Avoiding dealing with the realities of life (safe vs risky problem - hedging a losing trade rather than closing it out in the hope not needing to take the loss, but somehow struggling your way out of it - rarely works, lol, I tried it.. )
Trading Success really is MASTERY of your mind, and your emotions (note: it is NOT the absence of emotions!). Stuff is happening all the time. There will always be a challenge. There will always be a problem. There will always be a setback. You will always stuff up in some area. If we're emotionally reactive to all of this, trading success is, to say the least, elusive.
We must practice the art of EMOTIONAL MATURITY. Stuff WILL happen - be prepared for it. We CAN choose to deal with it constructively. With a reminder to ourselves that stuff was always going to happen, so don't be so surprised /disappointed /shattered /dramatic.
Sulking. Anger. Drama. Blame. Giving up. Like somehow the world is going to suddenly stop and go: You're right! Of course you're the victim in this! So sorry! Of course you don't have to grow. Or ask anything of yourself. Or be thoughtful. Or hear feedback. Or act with maturity and grace.
Just stay emotionally immature and reactive to everything and let the Universe magically make life easier for you (yes, you are special..), so you don't ever get triggered and life stays full of unicorns and fairies and trading success somehow shines upon you without you needing to deal with the challenges we all have to conquer! Which means, from now on, the world will always agree with you, pander to your every emotional outburst, apologise swiftly and expect nothing back, never ask you to do what you said you would, and never ever expect you to be a grown up.
The key is not to expect the problems to go away. It's to be the trader who handles whatever life throws at you, in the face of fear, in the face of disappointment, despite the unfairness of it.
Jim Rohn already said this, he might have gotten it from the bible .. or life experience.. Because we can handle whatever comes along. There is always a way. Just most of the time the way leads outside of what we already know.
Practice mindfulness. Being present and aware of your habitual reactions. Ask yourself: How does this reaction serve? Is there a way to react that is a response? That is, it's reflective, thoughtful, in proportion to the event, and shows I can handle this? I can improve from this? I can do better next time?
Seek out challenges that are good quality challenges. Lack of time, money, happy relationships are not good quality challenges.. they are what we call safe problems. If you want to be a successful trader, you have to seek out good quality challenges, how can I get more skilled? How can I improve my thinking? How can I become more strategic?
Ask yourself: How can I show up right now so that my future will look the way I designed it? That I show myself I have grown? That I am making progress? That I am moving towards being a successful trader?
Emotional Reactivity versus Emotional Maturity. Trading Success really is an inside job.
Let 2019 be new choices to welcome this into our lives and our minds and hearts so that we can become the trader we are aspiring to be.
PS: If you want to learn to Master your mind and your emotions, the Fierce 10 Trading Mindset Transformation Challenge can help.