Guilt and Trading

This question was sent to me from one of our students: “Hey Joe! I sometimes feel guilty about my trading. Is trading a sin?”

No, trading is not a sin, but trading without knowing what you are doing can lead to a lot of problems. Trading in and of itself is not considered as gambling. The futures markets exist as a venue in which hedgers are able to “purchase” price insurance. The ability to hedge is the economic and social justification for the futures markets. However, gambling is considered to be foolish. Trading without adequate knowledge of the markets and self is foolish because by doing so you are gambling.

There is a certain amount of self-knowledge needed to choose the proper trading method. It has even been suggested that many small traders in the futures market, without knowing it, secretly want to lose. They jump in with high hopes - but feeling vaguely guilty. Guilty over 'gambling' with the family's money, guilty over trying to get 'something for nothing,' or guilty over plunging in without really having done much research or analysis. Then they punish themselves, for these or other sins, by selling out, demoralized, at a loss.

trade what you see........i have been attacked off and on for 5 years for saying that on forums...i don't care for the millions bits of information out there both live and dead...i just trade when my signal shows up on the screen in front of me, not in my mind or from other sources....simple is as simple does ...it still works......thanks joe i really appreciate your comments.......

Joe, thanks for those insightful remarks. Here are a few more – a little bit more hard edged btw.

Trading is not production work. Trading is performance work.
Trading is not ‘making money’. Trading is ‘taking money’
Some have unresolved guilt at taking , whether consciously acknolwedging that or not, even though they can consciously acknowledge that they are stepping into an arena with at least ‘equals’ (and in most cases with their ‘betters’ who have little compunctions about ‘taking’ anybody’s money, whether by hook or by crook… and hopefully they can acknowledge that the ‘house’ / exchanges and the state will also screw them any and every chance they get.)

The pareto principle is alive and well in the markets and 78.6% really are ‘losers’. ‘Guilt’ ( / one’s operational ‘programs about karma’ / one’s unresolved past and decisions of defeat) is helping to swell that up to 80% far more than any of us – lightweights or heavy weights – would ever realize or admit! Even the trading ‘psychologists’ and ‘coaches’ would only rate the ‘guilt’ factor a little higher than ‘normal’ traders do - ie neither would be up to close to where it’s really at if it were quantified by good psychometrics across the population of traders. 'Reciprocity' is much bigger among us mammals than most traders want to admit.

I alluded to this over in the “Why so few” thread a while back. Socrates did too with his comments about merit, , and …. If you are not in the top pareto of the pareto, add this to your list of issues that must be resolved completely - or you don’t stand a chance in the long run!

ZDO said:

Joe, thanks for those insightful remarks. Here are a few more – a little bit more hard edged btw.

Trading is not production work. Trading is performance work.
Trading is not ‘making money’. Trading is ‘taking money’
Some have unresolved guilt at taking , whether consciously acknolwedging that or not, even though they can consciously acknowledge that they are stepping into an arena with at least ‘equals’ (and in most cases with their ‘betters’ who have little compunctions about ‘taking’ anybody’s money, whether by hook or by crook… and hopefully they can acknowledge that the ‘house’ / exchanges and the state will also screw them any and every chance they get.)

The pareto principle is alive and well in the markets and 78.6% really are ‘losers’. ‘Guilt’ ( / one’s operational ‘programs about karma’ / one’s unresolved past and decisions of defeat) is helping to swell that up to 80% far more than any of us – lightweights or heavy weights – would ever realize or admit! Even the trading ‘psychologists’ and ‘coaches’ would only rate the ‘guilt’ factor a little higher than ‘normal’ traders do - ie neither would be up to close to where it’s really at if it were quantified by good psychometrics across the population of traders. 'Reciprocity' is much bigger among us mammals than most traders want to admit.

I alluded to this over in the “Why so few” thread a while back. Socrates did too with his comments about merit, , and …. If you are not in the top pareto of the pareto, add this to your list of issues that must be resolved completely - or you don’t stand a chance in the long run!

Click to expand...

Hello ZDO, I wholeheartedly agree.

You have singled out one problem out of a cluster of problems that beset aspirants.

I am a bit bizzi at the moment but I will add to this post later.

Ok, here we go...

Greed is an effect in a similar way that impatience is also an effect, they are not real, they are perceptions.

Similarly guilt is also an effect.....it is also another perception, within a cluster of perceptions.
All of these belong to a related cluster of effects.

What is the root cause that drives guilt in trading ?

The root cause is the force of habit.

Habit implies you are accustomed to doing certain things that need doing.

Much of trading is totally devoid of having to do things, in the sense that often there is nothing to do.......you have to learn to wait.

You have to teach yourself to wait.....that is...to wait for the right opportunity to present itself.

If you are not able to master waiting it is because you are not accustomed to it.

You feel...you ought to be doing something.

If you allow your ego to drive you, that is the result.

Very often doing nothing is what needs to be done, and nothing else.

Because doing anything for the sake of it is forcing.

You cannot force....the market will not allow you to force....and that is where the guilt comes in.... you must conquer the emotion ...or....it will conquer you.

ZDO said:

Joe, thanks for those insightful remarks. Here are a few more – a little bit more hard edged btw.

Trading is not production work. Trading is performance work.
Trading is not ‘making money’. Trading is ‘taking money’

Click to expand...

hmm cheers pin sharp highlights...... now then this taking money from ?

anyone know what % is retail muggings verses corporate ? might help us deal with processing the issues in this mug or be mugged lark.

either way we can work at being stewards / custodians of money ?