Meditation

[avibe]

Just been thinking and i was wondering what would make 95% of traders lose.

Then it struck me.....EMOTIONAL STATES before,during and after trading.

How a trader feels before sitting down at his terminal, the thoughts in his head, which in turn influence his emotional state, then influence his decision making process, will eventually influence his decision in the market.

If i can quote a trader

whenever I try to execute the trade then the fear is coming in and hesitation. The system is good enough to keep give me some profit, however I fear staying in the trade for too long and closing it with very small profit. The risk reward ratio is not working well for me.

I bet there is some adrenaline rush when i enter the "market". My muscles are tense, my eyes fixed on the monitor...this high stress situation my brain can no longer cope up! With time or as the day progresses....my brain grew tired and i could not make better judgment.

So what brought about this scenario....MY EMOTIONAL STATE...fear..some deep eerie fear of losing, fear mixed with a sudden rush of i dunno what.....i was setting up myself for fear....for some it may not be fear, but it may be greed.....still both emotional states...lead to loss of judgement.....

I have compiled some self talk that i say to myself before trading....

1. I am in control of my emotions. I choose what i feel. Now i feel poised, composed and alert.

2. I make the right decisions at the right time. I make decisions with my head and not my heart.

3.I am financial genius. One of the best in the world.

4.I identify trends early enough and i benefit from them.

5.The market and I are one.:smart:

 

[£10kLoser]

Every trader gets what he or she subconsciously wants out of trading. The problem is that the vast majority (the 95%?) don't really believe they can become financially independent and so really want to fail. After all, we've been programmed from childhood that it takes years of hard work and some luck to succeed in life and we should work hard and long for a company all our lives.

The head says we can succeed at trading but the subconscious doesn't really believe it - and that's where meditation techniques can help because they can reach and reprogram the subconscious mind. You can't expect a 9 to 5 mentality to become a financially independent trader.

Most people make the mistake of wishing to become successful - this gets you nowhere. If you are attempting to communicate with your subconscious mind, you have to tell it that you are already rich and successful! If it believes that, then for sure you will be...

I would suggest you 'talk' to your subconscious for at least ten minutes when you wake up, before you go to sleep and several other times during the day - not just before you trade. It's a long process!

 

[leovirgo]

I have compiled some self talk that i say to myself before trading....

1. I am in control of my emotions. I choose what i feel. Now i feel poised, composed and alert.

2. I make the right decisions at the right time. I make decisions with my head and not my heart.

3.I am financial genius. One of the best in the world.

4.I identify trends early enough and i benefit from them.

5.The market and I are one.:smart:

I simply say..

1. I will not move my stop unless it is locking in some profits as per plan.
2. I will take every valid set up.
3. I will take profits as per my trading plan.

In short, I will trade my plan and nothing else.

Remember, your mind won't take half-baked truth. I used to say that I am a genius and it hurts alot when the evidence says otherwise. Knowing yourself is crucial to fix yourself.

 

[£10kLoser]

Remember, your mind won't take half-baked truth. I used to say that I am a genius and it hurts alot when the evidence says otherwise. Knowing yourself is crucial to fix yourself.

Unfortunately, that's the problem - our minds are mostly full of half-baked truths.

But I know what you mean...

The other problem is that you simply CANNOT know your subconscious. If you did, it wouldn't be your subsconscious, would it? Therein lies the problem that most people don't grasp at all.

 

[avibe]

There is an unconscious need in all human beings to self destruct. I dunno where it came from. Some say we want to self preserve ourselves yet we unconsciously want to self destruct

 

[£10kLoser]

Excellent point and one that does indeed affect trading. It comes from childhood traumas and is the cause of what is technically known as 'anxiety' (not the common use of the word). Anxiety is defined as constant low-level stress and stems from buried emotional problems that the conscious mind is totally unaware of.

They are usually fairly undramatic like being scared as a kid but I had one client (I used to work in the field) who had an illegitimate baby as a teenager and was totally unaware of that in her conscious mind. Now, something like that causes quite strong self-destruct urges!

 

[Hercules88]

In the beginning of my trading, I would always exit a position early due to the fear of losing. It was only until I broke trading down into a very mechanical process that I would gained the confidence to know when to stay in. It takes a lot of concentration and work though to control the emotions though. Good post!

 

[amit1986]

Most people make the mistake of wishing to become successful - this gets you nowhere. If you are attempting to communicate with your subconscious mind, you have to tell it that you are already rich and successful! If it believes that, then for sure you will be...

That quote pretty much sums up the primary reason why most traders fail. Most people get into this game because they think it's an easier way of making a good living. Most people want to become "rich and successful". They either were not content with their lives initially, or just hated their previous form of employment. Either way, there was a form of imbalance in their mind - something they needed to fix. But the mistake they make is thinking that trading will fix this imbalance, when the truth couldn't be any more different. The reality is, that imbalance needs to be fixed before one starts trading. As has already been mentioned, meditation acts as a way to fix this imbalance.

Some of the most successful traders in this world don't trade for the money. They don't trade for the "rush" you get when putting on a trade. Because they do not need to be "rich" and "successful", there isn't any psychological pressure in mind to pay the bills or maintaining a certain standard of living. This reduction of pressure in the back of their minds adds greatly to their mental capacity to think logically in trading and to not over trade. With those two psychological components in the right place, trading becomes a much easier game and greatly increases your odds of coming out on the winning side.

Amit

 

[leovirgo]

Some of the most successful traders in this world don't trade for the money. They don't trade for the "rush" you get when putting on a trade. Because they do not need to be "rich" and "successful", there isn't any psychological pressure in mind to pay the bills or maintaining a certain standard of living. This reduction of pressure in the back of their minds adds greatly to their mental capacity to think logically in trading and to not over trade. With those two psychological components in the right place, trading becomes a much easier game and greatly increases your odds of coming out on the winning side.

This is the cliche coming from trading coaches and trainers. I doubt if the most successful traders will agree to it.

1. The most successful traders have had to start from some level. They simply had to work hard to be successful. They know themselves in the sense that they can control their mind (that includes emotions). That's why they become good traders.

2. Autosuggestion method - where you hypnotise yourself to believe that your are 'already rich and successful' won't work for most of the people. It's like you lie to yourself. The abstracts like 'rich' and 'successful' won't do any good. Instead, you must focus on practicalities such as 'I will not move my stop' or 'I will follow my method 100%'.

3. Trading is like any other profession. You must possess traits of a successful person i.e, confidence in yourself and conviction in what you do. Confidence can only be built upon evidence not by fooling yourself. That's why IBs and hedgefunds want people who excel in any discipline.

4. Meditation should be used to clear your mind, to know yourself truthfully but shouldn't be used to lie yourself. It won't work. That's why 90-95% of newbies who rely on coaches and trainers' cliche fail.

 

[shadowninja]

That 90-95% statistic can be used for anything to do with trading, I see.

 

[sandpiper]

...but I had one client (I used to work in the field) who had an illegitimate baby as a teenager and was totally unaware of that in her conscious mind......

...and I thought I had a poor memory.

 

[leovirgo]

"It hurts me to lose money and it gives me pleasure to win. There is nothing more self-destructive than to deny your feelings."

"I have a very abstract mind.. I actually enjoy looking at things, including myself, from the outside."

Soros on Soros: in his own words, p13