Traders have the freedom to work for themselves and on their own terms. Yet many traders have trouble remembering this fact. In a competitive world where most people define their self-worth based on how they compare to others, there’s a powerful need to keep up with the guy next door. Out of sheer habit, one continues to ask, “How well am I doing?” and that question usually leads to asking, “How well ‘should’ I will be doing?”
When words like “should” and “must” enter the picture, however, one places a lot of unnecessary pressure on oneself to perform. And when the pressure is on, we usually choke under the strain. It’s a hard lesson to learn, but usually, comparing ourselves to others is useless, and at times, counterproductive. You’ll make more profits if you learn to look inward for your own personal standards than outward in an effort to beat out the next guy.
Modern society is replete with images of success: “Buy a sleek, new sports car and impress the neighbours. Wear the latest designer fashions and watch heads turn as you walk by.” Implicit in all these messages is the idea that in order to have value as a person, you must have more, or do more, than your friends and neighbours. But such comparisons are usually superficial, especially when it comes to trading.
Trading is a natural, integrated activity, in which each trader brings his or her own knowledge, personality, trading method, and tools to the trading arena. Through a coordinated integration of these various components, the trader builds up a set of individualized trading skills that produce lasting success. Such integration doesn’t happen overnight but through hard work and persistence. Over time, one makes trade after trade, gaining key experiences along the way, until it all comes together in the end. One needs to find one’s own personal talents, accentuating one’s strengths and working around one’s limitations.
Every trader is on his or her own path. It makes little sense to compare oneself to others. Trading isn’t like grade school where all one has to do is do the homework, get passing grades and be branded a “success.” Trading requires skills that only a select few will master. Some will never make it, while others will see huge profits. Thus, it isn’t necessary to judge yourself by comparing yourself to others. You need to find your own standards. You can do what you want to do without reference to anyone else.
Studies of successful and creative people have documented a rugged individualism, in which one works by his or her own standards. Even in competitive situations, creative people don’t compare themselves to others. They look inward and let their internal standards guide them. They know that through persistence and determination, they will achieve success. They don’t force it. They know that if they allow themselves to follow their passion, success will come naturally.
It’s essential that you take a similar individualist approach when you are trading. Don’t compare yourself to others. It may be hard to fight the urge, but when you find yourself doing so, stop. Instead, look inward. Compare your current performance to your past performance. Ask yourself, “How well am I doing these days compared to how I’ve done in the past?”
Even these kinds of comparisons must be made carefully, however. Make sure you are making meaningful comparisons, and consider factors that may hinder or enhance your current performance, such as market conditions. For example, don’t feel bad because you’re not making the kind of profits in a current sideways market that you’ve made in a past bull market. It’s also important to focus on the process of learning to trade properly. Don’t make it all about profits. If you are now clearly specifying a trading plan and sticking with it, for instance, that’s making progress regardless of how much profit you made.
So remember, although it’s often fun to compare yourself to others and build up your ego when you are doing well, it’s often a waste of time in the long run. Each trader has his or her own talents when it comes to trading. It makes no sense to compare apples and oranges. Go your own way. Focus on your own personal goals. By trading on your own terms, you’ll eventually achieve lasting success.