perfect article by Ruth barrons Roosevelt - enjoy!
In my years of coaching traders and investors, I have seen many
kinds of self and profit-defeating behaviors. One would think it
would be easy enough. Find a winning strategy that gives you an
edge. Test it to make sure that it works. And employ the strategy
consistently. Some do that, to be sure. But others become their own
worst enemy on their way to success.
Traders and investors hang onto losing positions until the enormity
of the loss overwhelms them.They sell their winning positions
quickly , while the trades go on to make enormous profits. They write
trading rules, only to violate them. They get greedy and over-trade,
only to lose all their money. Some simply can't pull the trigger on
a trade or investment. The opportunities slide right past them as
they remain immobile and disappointed.
John Smith (not his real name) came to me after a year of watching
the markets. He said he wanted to support himself by day trading the
E-mini S & P.He had only taken three or four trades in the past year.
His proven system offered him 15 to 20 trades a day and made money on
paper. He had the idea that if he studied enough, he could pick out
the winning trades and let the losers ago. In fact, those few trades
he had taken had been losers. Time and money were slipping away. It
costs money just to sit there day after day doing nothing.
John said he was learning by watching the market. I suggested that
what was learning was how not to trade. I suggested he start each day
setting his intention to actually trade, and that he leave the screen
as soon as he let the first trade go by. He agreed, but was unable to
do that. He sat there watching, telling himself he was learning about
the market. He had developed a comfortable spectator sport.
When fear is stronger than desire, fear dominates. John feared losing
money, and he feared being wrong. Each time a signal came up, he
imagined that if he took the trade, it would be a loser. Imagination
is stronger than will power, and so he was unable -no matter how
determined -to put the trade on.
Over the next three months, John began to trade. First, he mentally
rehearsed taking all the trades. He shifted the belief that losing
made him a loser was wrong, to the belief that losing is a natural
part of the game and that not taking all the trades is wrong. He
shifted his imagination from losing to winning by asking himself
whenever an entry signal came up, "What if this trade is a big
winner?"
Most importantly, he learned to set a new intention when he began
each day's trading.He shifted his intention away from losing or
making money to following his system. He understood that the long-
term consequences of following a winning strategy consistently was
indeed wealth creation.
He developed what I call emotional inoculation through actual
trading. At first he only took one trade a day, then two, then three,
and finally all of them. Each time he took a trade, it became less
significant and easier to do. Today he makes a nice living with his
trading.
End of quote
