Module 12 Innerworth — Mind over markets

Chapter 111

In the Mood

Jason is in a rut. He feels as if his trading performance is lacking, although he’s relatively new to trading. He is easily upset. Even the slightest setback gets him down. He wonders, “Why can’t I make huge profits? How am I ever going to get rich unless I can pile on the profits faster?”  Jason has a lot of attitude problems. He’s talked himself into a non-productive mindset. He can take decisive steps, however, to cultivate a more optimistic mindset that will allow him to more easily enter the zone.

The first step Jason can take is to change his reference point. Currently, he is comparing himself to an ideal that he just can’t attain. It’s as if he is thinking he is a “Market Wizard,” when in fact, he is a relative newbie. If you compare yourself to the most elite, you’ll rarely match their performance levels. You’ll feel frustrated and upset more than assured and satisfied. It’s more productive to set goals that are a little lower. It takes many years of persistence and experience to develop the skills of a seasoned trader.

In the meantime, it’s useful to restrict your comparisons to your own past performance, and only do that when the market conditions are similar at both reference points. Even an expert trader doesn’t trade with the same level of success under different market conditions. Another way to feel that one is making progress is to set learning goals rather than performance goals. That is, don’t judge your trading performance solely on the dollar amount or percentage return you achieve. Also, consider the amount of time and effort you expend learning how to trade, and do so productively. Learning to trade consistently and profitably is about skill-building.

To build a proper level of skills, it is essential to gain experience and practice. If one is trying to achieve unrealistic levels of performance, though, one is likely to experience such extreme stress and frustration that one backs away from gaining experience, stagnating rather than building reliable trading skills. By focusing on learning how to trade and gaining the requisite skills and experience, one will be more likely to become a profitable trader.

Similarly, it is vital to focus on the immediate experience of trading. Trading is an enjoyable endeavor, but if you are focused only on the profits, and on how much you’re making or losing, you’ll be distracted. You’ll feel anxious and stressed out. At high levels, these feelings aren’t conducive to trading. The more anxious one feels, the more trading mistakes one will make. If you focus on the ongoing process of trading, however, you’ll feel more at ease and creative. By enjoying the process of trading, you’ll continue to build up your trading skills and learn what it feels like to trade effortlessly and with confidence.

It’s easy to get sidetracked when trading. Trading is difficult, and it is easy to get stuck in a rut. By cultivating the proper mindset, however, you can persist even under adverse conditions. By setting realistic goals and by focusing on the inherent rewards that trading offers, you’ll be able to more effortlessly cultivate the mindset that will help you trade profitably.

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