The Hidden Agenda that Rules Your Trading Performance


9 ratings



Rande Howell

24 Jun, 2011

in Psychology

Dale grew up in a hard working farm family in Arkansas.  His parents, while growing up during the Great Depression, had nearly lost their farm.  That experience really changed them.  They hoarded what little money they had and came to believe bad things can happen if you can’t be certain about the future.  And Dale was born into this legacy.

Leaving the farm for greater opportunity, Dale became a banker in a trust department of a bank where he protected the value of assets placed under his care.  He was a natural at his job of maintaining certainty in the face of threats to his clients' capital. As time went on, the bank was gobbled up and Dale was fed up.  In a career change, he moved into day trading.  He learned a proven methodology to control risk well and was prepared to trade.  What he was not prepared for over the next several years was the hesitation and anxiety he experienced, and could not overcome, when he risked capital.


The brain, memory, pattern, and the unconscious mind make unlikely partners to your trading methodology.  Like Dale in the case study above, after investing a number of years learning and tweaking a methodology that should provide an edge, traders often discover that something is still missing that limits their success.  It’s not their methodology, they conclude – it’s them.  Though they strive for success, they keep falling into the same self-limiting patterns over and over again.  No matter what they try, who they train with, or who they listen to – they stay stuck and they do not know why.

If they want to make money and are willing to invest the time and energy into learning, you would think that they would achieve their goal, even only by perseverance.  It is as if something seizes control of their mind and their capacity to dispassionately trade their plan is hijacked.  After the smoke clears, and they come to their right mind, most traders feel as if their bodies and minds were kidnapped by unseen forces.  If you have ever thought this – you are not alone.

What Really Drives Your Perception of Money

In a capitalistic culture such as ours, our sense of personal worth, adequacy, meaning, and power get woven into our perception of money.  As an example, a trader (who has not been successful for several years) is at a cocktail party.  He strikes up a general conversation with an unfamiliar man.  And the man asks, “What do you do?”  Right there, the trader’s identity is tied to trading.  The next question is, “Can you really make money at trading?”  Though the trader has yet to be able to support his family on his earnings from trading, he answers, “Yes.”  Then the trader proceeds to create a fiction that paints a rosy picture of his life as a trader.

Actually the trader feels shame erupt and he feels “less than”, so he lies to cover up his embarrassment.  The trader’s notion of being a successful human being and his sense of mattering in the world is so tied up to how much money he should be making that he finds himself lying.  His worth, his importance, and his social standing are tied up in his relationship to money.  Money has become the yardstick by which he measures his value as a human being.

And as long as his perception of money is the measuring unit by which he gauges his worth, he will continue to struggle with finding success in trading.  External validation by performance in trading becomes the judge of his character.  His ability to make money in trading moves from competency of performance in a certain domain (where mistakes point out where he needs to learn in order to become better) to judgment of his worth as a human being.  Where does this come from?

We Are Born Into a Money Script

Go back to the case study of Dale.  Dale is born into a certain history and his brain adapts him to the conditions of that environment.  His parents had been devastated financially by the Great Depression.  Life had become very uncertain for his family’s financial survival.  They were scared that they would not have enough money to put food on the table and a roof over their heads.  Money was scarce, and they could not afford to lose anymore.  This was the mantra by which they lived.  Like many of their generation, they became savers and avoided risk at almost all costs.  They were risk-averse and had developed a way of seeing the world as a dangerous place where things that could go wrong - and did, in fact, go wrong.  This became their mindset.  And it governed the way they saw life.

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Re: The Hidden Agenda that Rules Your Trading Performance

Good article

Apr 16, 2017

Member (3620 posts)