THE LURE OF TRADING
Trading is full of paradoxes and contradictions in thinking, thus making it extremely difficult to learn how to be consistently successful. Financial and emotional disaster is common among traders because many of the perspectives, beliefs, attitudes and principles that we have learned and adopted in our daily lives have the opposite effect in the trading environment. Not realizing this most traders start their careers with a fundamental lack of understanding of what it means to be a trader, the skills that are required and the depth to which those skills need to be developed.
Trading is inherently risky; no trade has a guaranteed outcome. Most traders would agree with this statement. If you engage in an activity that is inherently risky then you must be risk takers, and in fact many traders take pride in the fact that they are risk takers.
Of course any trader is taking a risk by putting on a trade but that does not mean that they are correspondingly accepting the risk. All trades are risky because the outcomes are probable not guaranteed. But do most traders really believe they are taking a risk when putting on a trade? Have they really accepted that the trade has a non-guaranteed probably outcome, have they fully accepted the consequences?
The answer is no. Most traders have no concept of what it means to be a risk-taker in the way the successful traders think about risk. The best traders not only accept the risk they have learned to embrace it. There is a huge psychological gap between assuming you’re a risk taker because you put on trades and fully embracing the risks inherent in each trade. When you fully accept the risk, it will have profound implications on your bottom line performance.
- The words “taking responsibility” sounds simple enough yet the concept is neither easy to grasp nor put into practice. We have heard the phrase so many times that it is easy to take for granted that we know exactly what the phrase means.
- Taking responsibility in trading and learning the appropriate principles of success are inextricably connected. You must understand with every fiber of your being, that ways in which you are and are not responsible for your trading success.
- To express yourself as a consistently successful trader you must deactivate limiting beliefs, create new empowering beliefs and work on your mental and emotional attitude. To realize your potential your goal must be to learn how to think like a consistently successful trader.
- The best traders think in a number of unique ways. They have created a mental structure that allows them to trade without fear and at the same time keeps them from becoming reckless or overconfident.