We are finally in 2020. The holidays have passed well and looks like we are ready to start a new year. I don’t want to give you more of the same with lots of charts and analysis, patterns, mistakes, reviews, trade ideas. I would like talk to you about the psychological side of trading.
As we already know, psychology and your mindset accounts for a huge chunk of a Traders Success. Some say its more than 90% and i would Agree to that.. I want to share my strategies for overcoming the hard times a trader might go through (applies to day to day life as well) so perhaps you can approach it more effectively and efficiently without losing a lot much time and money as i did and cut the learning curve a bit. In my opinion there are a couple of strategies that every trader should consider on the mindset side.
- Losses are a part of the game. In-fact that is the only thing you can actually control as a trader. Nothing else is in your control. Trading is like any other job with its ups and downs. With success and failures. This is a game of probability and no loser should become a personal insult for you. The best traders on earth have developed a very high level of Emotional Intellect that keeps their personal feelings and thoughts aside like love, care and joy separate from Trading. This is something you develop with time and its called the FLOW state. Once you are in the FLOW state, your head, soul and emotions work like a high end Swiss watch without any interference and errors. Once any of these show signs of weakness, the whole system collapses. This takes us to the next point.
- Trading is only a part of life.Friends, family, loved ones are the interactions that truly matter in life. No winner or loser should affect our attitude towards the ones that are close to us. The more we put our soul in trading, sometimes the less we can give to our loved ones so keep it simple. Treat it like any other business. From my experience trading is like a relationship, you build it carefully and with patience, you don’t push too hard nor do you ignore the important moments. You work hard but you keep it healthy. There is no rush and there is no boundary. That slowly passes the idea to the next point I would like to make. The Markets were here long before we were on this earth and they will be here long after we are gone. Take your time, Really master this craft.
- Balance is crucial.. By working too hard, you might burnout really easily. Remember the last time you watched a few thousand stocks and then tried trading a few dozens, it usually ends up badly for your emotional state and which is more frustrating, and usually causes damage to your account and your P&L. Balance is an inside job, its on you. Balance is having a healthy emotional status, doing sports, having time for creativity, enjoying life and people around you. Balance will keep your soul, body and mind healthy in any situation. Balance will heal you during the bad weeks and months and will help you take strategic decisions when the opportunity comes. I will go as far as to say, Don’t even try to create balance, because the word balance or when you say i need balance, what you are really saying is that right now things are unbalaned. Think positive, a better work is Integration. Create Work-Like integration rather than balance.
These are just a piece of “advice” or “wisdom” that should be taken into account when you start or even moving through your trading journey. The sooner you think of these strategies and start applying them into your day to day life, the better trader you become. We all have goals and targets to achieve, we all have bills to pay, we all have 24 hours a day and we all live once so lets make this journey a truly joyful one.