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In order to become a successful trader, you must change your perception of what a loss means. There will be trades that generate a loss of equitythis is a cold, hard truth. The meaning that traders attach to that loss, however, will be determined by their perception, which in turn is influenced by their beliefs and the emotional intensity they attach to the loss. Since the vast majority of traders have an inherent resistance to acknowledging a losing trade, you must adopt the belief that you want to acknowledge a losing trade as quickly as possible. Otherwise the resultant stress and anxiety will prevent you from accomplishing your goal. |
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The amount of money you consistently produce will depend on forcing yourself to represent a loss in an empowering way. |
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The stress and anxiety that most traders feel is caused by the failure to strengthen their nine virtues. It is also caused by thinking either consciously or unconsciously that the market conforms to some logical, predicative, and reasonable rules (as yet to be discovered by the trader). It bears repeating that excellent traders have come to the realization that the market is a never-ending event. Excellent traders believe that the market behaves with absolutely no regard for their financial position. |
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In many ways the market is like stormy ocean waves. Each wave is unique, the exact characteristic of the wave cannot be predicted, the variations are endless, the waves are endless, and there is no beginning, middle, or end to the amount of water crashing on the beach. Similarly each trade you enter is unique, the exact characteristics of the trade cannot be predicted, the variations of the price action are endless, the price action never ceases, and the market is constantly washing away the novice traders. |
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Everybody tells the new trader to let profits run, and cut losses short. It seems that everyone has a ''system" or a "course" to sell you. There are countless ways to generate a stop loss price, an exit price, and an entry price. It seems that all you have to do to make lots of money is to find the right system. The truth is that the real work of trading is performed in the space between your ears. The amount of pain you experience when you lose money is a good indication of how much work you must perform to change your beliefs about the market and your perception of a loss. |
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The amount of pain that you place on a losing trade is the result of your focus and beliefs. One trader might become very upset at losing $500, |
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