Trading Not to Lose: A Disguised Fear of Loss and the Future

[Rande Howell 10]

Steve stared at the set-up. It was a close match for what he was seeking. He had seen this pattern emerge many times before and was comfortable that this was a high probability trade – right in line with his trading plan. Now all he had to do was get the right price. He put in his order at a rock bottom price figuring that he was managing any potential for loss. And then he waited for it to be filled. And he waited. As he waited, he watched as the trade kept climbing. Finally it had run its course and Steve, again, had been left on the sideline of the trade – his order was never filled. And this was not the first time. It was a persistent pattern that defied explanation.

 

Frustrated, he looked at his charts and recognized for the umpteenth time he had let a high probability, low risk trade slip through his fingers because he had insisted on a rock bottom price when, in fact, if he had acted within the price range that his trading plan had called for, he would have been able to profitably enter the trade with plenty of room to spare. This was a persistent pattern in his trading, and he did not understand it. There was also a sense of relief that he had not lost capital. He really liked keeping his potential losses to a minimum. Ex-comptroller that he was, he took great pride in loss abatement. When he looked at his ratio of winners to losers, he smiled. It was good. It was very good.

 

The problem was that he was not entering enough trades to make a comfortable living. The truly frustrating part for Steve was that he knew he knew how to trade. He was good enough at his methodology that he could teach it. The problem, as he saw it, was that he could not find the perfect blend of indicators and signals that would make his system work properly. As soon as he figured that out, he knew he would be able to make his financial dreams come true.

___________________________

 

 

Being Blind to a Self-Limiting Pattern

 

If you look at Steve’s situation from a third party, emotionally detached, perspective, it is easy to superficially spot the problem. He simply needs to tweak his trading plan to allow more flexibility in what price he is willing to pay to enter a trade. After all, there was plenty of room for a profit. With his trading plan modified, he would have more flexibility on his entry points and would confidently ride the high probability, low risk trade predicted by his charting. Following this line of thinking, the problem would then be solved.

 

And if traders were, in fact, rational and emotionally detached human beings, this would be the case. However, because they are human, actually all their thinking is emotional state dependent. And what lurks in the shadows of the mind (pushed far away from conscious awareness), does create a persistent pattern of perception, emotion, thinking, and behavior that limits a trader’s potential for peak performance trading. The trader becomes blind to this pattern operating in the background of his awareness – he does not even see it influencing this perception. Off his radar screen, it keeps hijacking his capacity to successfully perform in his trading.

 

Here is the way one trader described this form of blindness:

 

__________________________________________

 

 

“Most traders don't believe one of the key variables to successful trading is themselves. Thus, they ignore or underestimate the importance of themselves as a key piece of the puzzle, which is why they get "tunnel vision" about their trade methods.

 

I also see an escalating situation where traders realize that they have a discipline problem via publicly stating such as a fact...they believe their "self help" solution is too fine tuned for their trade method. Simply, once again, they fall back into the trap that it's about the trade method, only under the facade they are working on their discipline problems.

 

Further, just as much of a problem, many of those that show up to give advice about the discipline problems...their recommendation involves changing, tweaking or fine tuning the trade method. This pattern (pun intended) helps instill the belief that if we fix the trade method...we'll become disciplined traders. It just doesn't work like that.”

_________________________________________

 

 

Like many traders before him, initially Steve was resistant to exploring how he was part of the problem. He looked everywhere but failed to look at his psychological contribution to his trading problem. As a rationally trained man, he believed the problem was “out there”. And that he, of course, was rational. The problem, in his perception, was to be fixed by altering the variables of his trading plan. The trading plan was the problem. If the trading plan were fixed, his problem would go away. What he had to acknowledge, though, was that after five years of rationally “fixing” his trading plan (when it worked quite well in simulation) was that the trading plan was not the problem – he was. But how?

 

Trading “Not to Lose”,

Rather Than Trading With an Edge

When Steve began to examine beliefs that he brought into trading, he discovered he carried more emotional baggage than he initially thought. And, in his mindlessness, these deeply held beliefs directed what his rational mind saw. His hard-nosed approach to price and avoidance of loss, under close scrutiny, was not the product of rational, impartial problem solving. It was fear masquerading as reason.

 

What Steve discovered was that he had been using “rationally thinking” as a way of avoiding his discomfort that trading forced into the conscious mind. Uncertainty and loss had become associated with one another in Steve’s brain/mind – his perceptual map. He carried this fear of loss in the face of uncertainty as self limiting belief now. But it was beneath the surface. It was like a submarine, beneath the surface, torpedoing a ship on the surface. Fear was the submarine. Rational was the ship on the surface. His trading was the casualty.

 

When he traded, he triggered to this perceptual map that had become a self-fulfilling prophesy. The truth, beneath his rational exterior, was that he believed that the uncertainty of the markets would lead to loss if he were not very careful. Out of this deeply held and unconscious, fear-based belief, he created a rational cover up to avoid the potential for loss. By never getting the price he wanted, he avoided the fear of uncertainty that kept blowing up this trading plan.

 

With his rational mind doing the bidding of his fear-based beliefs, he avoided the potential for loss in his trading. There was nothing wrong with his trading plan, he discovered. The limitation to his trading was based on the rules of uncertainty and loss he had learned as he grew up in a family that experienced terrible financial losses in his formative years. These years had been tough on the family. In the face of survival, they had learned the hard way to avoid uncertainty and to only risk when you could not lose.

 

This way of seeing the world (that the world is a dangerous place and you’d better be careful) became the hidden assumption that guided Steve’s development of risk management. And in his profession prior to trading, as a corporate comptroller, this perceptual map worked well. Steve did not see his perspective as a personal bias though; he saw it “as the way it is”. This is because it had become a familiar pattern and was pushed into the background of his awareness.

 

The very skill set that gave Steve an “edge” in corporate finance had become a liability in trading. He had developed a habit of trading “not to lose”, rather than a mindset of accepting and managing the risk of probabilities that trading demands

 

Steve came to recognize that it was not his trading plan that needed to change – it was him. This is not to say that his trading plan does not need to evolve, along with him, as he moves deeper into his journey of trading. What Steve came to understand was that he is an inseparable element from his trading. Each element – from platform to methodology to personal psychology – has to be woven together with care to create successful trading.

 

And without a close examination of the beliefs in which his psychology is rooted, he was missing the access to a key element to successful trading. He fell into the deception that he was rational and that “rational” was normal – even superior. It felt emotionless, which he had been taught was how a trader needed to trade. This was also a stumbling block to his growth as a trader. What he discovered was that “rational” is an emotional state among other emotional states. And that he could hide his discomfort behind the façade of “being emotionless” that a rational emotional state provides.

 

Rational became a defense that allowed him to avoid looking deeper into himself. After closer inspection he discovered that a deeply rooted fear of loss had caused him to stay out of trades. Demanding a price that the market was not willing to give became a way for him to avoid his fear that he might lose. And with his logic and rational thinking captured by this fear, he produced a trading plan of elaborate criterion that looked good and keep him out of trades. And because it was so familiar to him, he never saw the self limiting beliefs operating within him.

 

Mindfulness as Part of a Psychological Trading Plan

You have just read about a trader wakening up from his mindlessness. He was so absorbed by his logic that he could not see that it was blinding him to the core problem. It kept him focused on the surface of the problem. He saw symptoms of the deeper problem, but the symptoms so pre-occupied him that he thought the symptoms were the problem. He was lost in his direction, but making good time.

 

Questions for Developing Your Mindfulness:

(1) If you take a look at the symptoms of your trading, what do you discover?

 

(2) What is the consistent behavioral performance that keeps repeating itself?

 

Then let’s go a little deeper.

 

(3) What kind of game plan seems to be in place?

 

For the trader in the example above, for instance, the game plan was “not to lose”. His game plan did not include managing the risk of uncertainty so that probability was on his side. He kept telling himself that in his self deception he was trading to win, but his behavioral performances over time told a different story. His logic actually covered up the deeper self-limiting belief that was at the core of his lackluster trading performance. The second part of his game plan was to hide from his fear, and he accomplished that by staying stuck in a kind of "logical thinking" that produces merely surface evaluation – projecting the problem outside of the self – rather than a mindful attitude that looks for the beliefs beneath the performance.

 

(4) Based on your trading performances, not on your rhetoric, what beliefs actually drive your trading?

 

No one is going to be looking at your answers to these questions. The questions are designed to help you discover the current psychological organization of self that trades your platform and methodology. Becoming mindful of them is a major step in changing them into more effective beliefs that open up the possibility of peak performance trading.

 

As long as hidden beliefs stay out of sight, they are out of mind. But, they still influence your trading performance. You are simply mindless of (i.e. blind to) their influence much like a horse with blinders on never sees the green grass on each side of the path. The blinders become the “tunnel vision” that limits what the horse (or the trader) sees and can act upon. Developing this kind of mindfulness is a major element in the evolution of a trader. Without its development, you stay stuck in the pattern of seeking answers “out there”. With it, the trader becomes aware of the tunnel vision that has blinded his development. Blinders off, a new vision of trading emerges where platform, methodology, and personal psychology coalesce into a dynamic new possibility of peak performance trading.

 

For a video interview by MoneyShow.com with Rande Howell regarding managing uncertainty and mindfulness, click here http://www.moneyshow.com/video/video.asp?wid=6913&t=3&scode=020437

[MightyMouse 12]

Steve's dollar risk is too high. He should lower the dollar amount that he can lose. If he keeps lowering it and he still remains fearful, then he should really choose another career. He is the proverbial square peg. Have him become a clerk on the floor of the exchange if he wants to be close to the action.

 

As a trained professional, you should advise him that he is too far from center to ever make it and all the counseling in the world won't get him where he needs to be. If the counseling does help, then he will likely have bouts of relapse in the future and he will once a gain be staring at a screen not able to take the set up.

[Tradewinds 12]

This is a great example. It helps to understand typical problems that happen in trading. The interesting thing in the story, is that the trader is so good at picking the exact reversal point, that he placed the order, to the penny, at the exact reversal point. If anyone finds themselves doing that, then they have an exceptional ability to see a reversal happening.

 

This technical side of this issue is related to a post I made here:

 

http://www.traderslaboratory.com/forums/f229/fill-issues-scalping-9558.html

 

 

 

I have the same problem as the trader in the story. I admit my problem, feeling that some traders might see me as damaged goods who should just give up, quietly go away, and live the rest of my life never realizing my potential, and really never being fulfilled in life. Actually, it's good to express those feelings. I'm not sure what it does, but I think it's positive. I think that my fear of loss in trading is very much related to my fear of what other people think of me. I could try to cover that up, but then it might drive the problem even deeper.

[Tradewinds 12]

Like many traders before him, initially Steve was resistant to exploring how he was part of the problem

 

I am starting to explore that possibility myself. After making stupid mistakes when I had all the information I needed to make the correct decision, I've realized that it's not my indicators, or my strategy that is at fault. It's my failure to execute properly. And that failure to execute properly is 100% my state of mind. In the past I could have blamed it on lack of knowledge or understanding, but when I see everything perfectly, in time to make the decision, and still do the wrong thing, then it can't be my trade set up. It's got to be me.

 

Actually, getting to the point, where I can read the market extremely well, is quite an accomplishment in itself. I haven't been at this level of accomplishment very long. I'm just achieving that now. But in the process of acquiring the technical skills, I have not honed my state of mind.

[Tradewinds 12]

What he discovered was that “rational” is an emotional state among other emotional states.

 

Interesting. I always associated "rational" as an emotionless state. As a way to become "cold", "hard", and unfeeling. Thinking that cold, hard and unfeeling is some superior way of dealing with life.

[MightyMouse 12]

This is a great example. It helps to understand typical problems that happen in trading. The interesting thing in the story, is that the trader is so good at picking the exact reversal point, that he placed the order, to the penny, at the exact reversal point. If anyone finds themselves doing that, then they have an exceptional ability to see a reversal happening.

 

This technical side of this issue is related to a post I made here:

 

http://www.traderslaboratory.com/forums/f229/fill-issues-scalping-9558.html

 

 

 

I have the same problem as the trader in the story. I admit my problem, feeling that some traders might see me as damaged goods who should just give up, quietly go away, and live the rest of my life never realizing my potential, and really never being fulfilled in life. Actually, it's good to express those feelings. I'm not sure what it does, but I think it's positive. I think that my fear of loss in trading is very much related to my fear of what other people think of me. I could try to cover that up, but then it might drive the problem even deeper.

 

Tradewinds,

 

If you are going to believe that someone can actually consistently pick trades to the tick and see a reversal happening before they happen, then you will never be happy with yourself as a trader because you are comparing the reality of what you know about yourself to the ego driven lies told to you by others. You will never be good enough if you compare yourself to the fantasy they sell you.

 

Trading is hard work and it is hard for everyone and not just you. Run in the opposite direction when someone tells you that they make money every day, week, or every month. Run when someone tells you that they consistently call the reversals to the tick. Or if you do not want to take my word for it and run, then put them to the test. Make them show you real time that they can call the market to the tick. Not one will expose themselves.

[johnw 10]

Tradewinds,

 

If you are going to believe that someone can actually consistently pick trades to the tick and see a reversal happening before they happen, then you will never be happy with yourself as a trader because you are comparing the reality of what you know about yourself to the ego driven lies told to you by others. You will never be good enough if you compare yourself to the fantasy they sell you.

 

Trading is hard work and it is hard for everyone and not just you. Run in the opposite direction when someone tells you that they make money every day, week, or every month. Run when someone tells you that they consistently call the reversals to the tick. Or if you do not want to take my word for it and run, then put them to the test. Make them show you real time that they can call the market to the tick. Not one will expose themselves.

 

 

You seem to cap your true potential, perhaps as insurance against fear.

It is probably not fear of failure that disturbs you, even though this seems to be the most widely mentioned fear here at TL.

 

No, it is probably the fear of the power of reaching your true potential that stirs and upsets you.

[joshdance 10]

When he looked at his ratio of winners to losers, he smiled. It was good. It was very good. ... The problem was that he was not entering enough trades to make a comfortable living.

 

I confess I do not have time to read the whole post.

 

But, why doesn't Steve keep his same number of trades, and increase his position size? Either way, risk is increased, but at least then he gets to psychologically have the confidence of a good W/L ratio.

[Tradewinds 12]

Tradewinds,

 

If you are going to believe that someone can actually consistently pick trades to the tick and see a reversal happening before they happen, then you will never be happy with yourself as a trader because you are comparing the reality of what you know about yourself to the ego driven lies told to you by others.

 

I don't understand what you mean by the "ego driven lies told to you by others." I'm trying to understand what you mean, but I'm not "getting it". But even if I don't understand, what is the solution? I think you are trying to tell me to not worry about being able to pick the perfect entry and exit points. And not to believe everything people tell me. But it seems like there is something more to your message.

[Tradewinds 12]

Originally Posted by Rande Howell View Post

 

When he looked at his ratio of winners to losers, he smiled. It was good. It was very good. ... The problem was that he was not entering enough trades to make a comfortable living.

 

I confess I do not have time to read the whole post.

 

But, why doesn't Steve keep his same number of trades, and increase his position size? Either way, risk is increased, but at least then he gets to psychologically have the confidence of a good W/L ratio.

 

The situation that is being described with the trader, is that; even if you gave this trader "Steve" good advice about trading strategy, he still would not be able to effectively execute it. You asked "why" the trader "Steve" doesn't adjust his trading strategy. The point is, that trader "Steve" has probably already adjusted his trading strategy a million times, and still can't execute the trade. The issue is, that the trader enters the order at the outside boundary, because of the fear of draw down. He is trying to be "safe", but ends up sabotaging the entry.

[MightyMouse 12]

I don't understand what you mean by the "ego driven lies told to you by others." I'm trying to understand what you mean, but I'm not "getting it". But even if I don't understand, what is the solution? I think you are trying to tell me to not worry about being able to pick the perfect entry and exit points. And not to believe everything people tell me. But it seems like there is something more to your message.

 

Well try to pick the tops and bottoms, if that is what you want to do, but do not think that someone else can do it better than you because they cannot. Not for any length of time at least. The above story is about a guy with a great ability to trade who is fearful. The ability to trade is the ability to trade without fear, not the ability to pick tops and bottoms to the tick. If a guy can't trade without fear he is not a trader. Picking tops and bottoms is a temporary ability. Real traders go from picking tops and bottoms to the tick and making good money to not being able to do a thing right and taking losses. No one gets it right all the time or 80% of the time or makes money every day, though they would like you to believe that they can and that can make you feel badly about yourself.

 

The fact is that they feel badly about themselves for not having the ability to actually do what they say they can do and they want you to feel as badly about yourself as they do about themselves.

[joshdance 10]

Not really related, but I prefer to trade breakouts anyway, as there is more confirmation, though a poorer entry. At least with oil, they can really run and often never touch the entry point. It eliminates the need to pick a point for a pullback, change in trend, etc. For me anyway, it's my preference.

[Tradewinds 12]

No, it is probably the fear of the power of reaching your true potential that stirs and upsets you.

 

Good point. I read about an extremely poor man whose wife won the lottery. He died soon after of a heart attack. I don't know the exact reason, but it would seem that the stress of the whole situation killed him. I thought about this for a while, and imagined what it would be like to have been in his situation. Instead of seeing all that money as being a ticket out of his hardship, he may have seen it as a very strange world that he was fearful of. I felt like I could actually relate that that mentality. So that may be part of my problem. It's seems very strange, but it's possible. I could be stuck in a "poverty mentality", and actually be afraid of success.

 

It's seems kind of strange that a person would intentionally sabotage their own success, but the reality is, that it happens. Maybe we really do need genetically engineered human beings. :rofl: It seems that the program running in our heads needs to be debugged.

[Tradewinds 12]

The ability to trade is the ability to trade without fear,

 

You are right. Good technical trading potential will go unrealized if a trader can't trade without fear. Not everyone has the potential for technical ability or achieves that level of understanding.

 

I guess everyone could potentially develop fear of something. In fact, a person who was incapable of fear, might be considered abnormal or even defective somehow. Fear happens. It can be a challenge, but I'd like to hope that people can overcome their fear, because unless that is a possibility, then we are all just at the mercy of random events with no control over our lives.

[joshdance 10]

I watched a webinar where the presenter said what I thought was a good point: "embrace the risk" on every trade. Before you take the trade, you must be okay with the risk, even embracing it.

[MightyMouse 12]

I watched a webinar where the presenter said what I thought was a good point: "embrace the risk" on every trade. Before you take the trade, you must be okay with the risk, even embracing it.

 

I think the best thing to do is make the risk small so it doesn't bother you. I would rather risk 200 a trade for my account size and if a really bad day occurs I lose maybe $2000 for the whole day than to risk 2% and potentially lose $2000 a trade. Its easier for me to deal with a series of smaller losses. If trades and lose $2000 a trade, I will soon begin to think twice about whether I want to take the next trade. With $200 I don't even think about taking the next trade.

 

On the winning end of it, I press and sometimes end up with as much as 8 times the position I started with. I do not do this every trade and frequently end up disappointed at what happens but when I hit, I hit pretty big.

 

We are all human. At some point everyone begins to worry. Figure out where your breaking point is and stay away.

[joshdance 10]

Good advice, thanks MM.

[Rande Howell 10]

Steve's dollar risk is too high. He should lower the dollar amount that he can lose. If he keeps lowering it and he still remains fearful, then he should really choose another career. He is the proverbial square peg. Have him become a clerk on the floor of the exchange if he wants to be close to the action.

 

As a trained professional, you should advise him that he is too far from center to ever make it and all the counseling in the world won't get him where he needs to be. If the counseling does help, then he will likely have bouts of relapse in the future and he will once a gain be staring at a screen not able to take the set up.

 

As most folks probably recognize, I take my sceneros out of clients I work with or have worked with. "Steve" is doing well now. Took a little work and soul searching. Fortunately he did not take your advice. We'll see about the future.

 

Rande Howell

[steve46 12]

The gentleman's problem is a lack of experience, as well as a lack of skill...to put it bluntly he is incomptent and should not be at risk unless he is simply doing this as a hobby...

 

The idea that one should attribute their problem to "fear" is fine, if it leads to some resolution of the problem, but in this case it doesn't..because really it is just a vehicle that you (Rande) are using as part of your promotional process..

 

The fact is that the gentleman in your example requires some "handholding"....if a person with skills could guide him through this process, a few repetitions would quickly show him what his options are, and how to manage both the trade and his fear...But as you have pointed out, you are not a trader...so this is not a solution that you can provide.

 

Fear ladies and gentleman is a good thing and (sorry Rande) not something to try to conquer or fix...in fact it is a safety mechanism..that is there to try to protect you (in the world of trading) from loss. Rather than run from it or try to "treat it" or manage it, one should first understand the protection that it provides...

 

Once you know the benefit that your fearful response is providing you may have more respect for it...meaning simply that if you are fearful...you shouldn't trade...until you have fixed the problem that caused it...AND that problem is almost always lack of skills, lack of experience and lack of education about what it is that you are trying to do....in most cases it certainly does not require psychological intervention...

 

Sorry Rande but at someone has to say something about the emperor's lack of clothes.....and by the way sir or madam, if you every wanted to obtain some real world experience with regard to trading, I would be glad to try to assist you so that when next you comment, you have something of substance to provide your prospects.

 

Good luck everyone...

[Tradewinds 12]

Fear ladies and gentleman is a good thing and (sorry Rande) not something to try to conquer or fix...in fact it is a safety mechanism..that is there to try to protect you (in the world of trading) from loss. Rather than run from it or try to "treat it" or manage it, one should first understand the protection that it provides...

 

Once you know the benefit that your fearful response is providing you may have more respect for it...meaning simply that if you are fearful...you shouldn't trade...until you have fixed the problem that caused it...AND that problem is almost always lack of skills, lack of experience and lack of education about what it is that you are trying to do....in most cases it certainly does not require psychological intervention...

 

There is good fear and bad fear. Good fear would be if you were afraid to feed a family of hungry bears, who might eventually look at the flesh on your bones as a good meal. Bad fear would be if a person couldn't leave their house because they had a phobia of the outside world. I describe these two opposing and extreme examples as a way to compare and contrast, and give perspective to the understanding of fear.

 

Please don't misunderstand me, I'm not discounting your good advice to keep incompetent and untrained people to go off blindly trading. I don't think the intent is to lead incompetent and untrained traders into mindless danger.

 

Because trading has such a high attrition rate, and has the potential to do a lot of damage, it's a good thing to warn and/or discourage people from getting into something they are not prepared for. So, having a concern for naive and unwary traders, and the desire to protect them from themselves, is an honorable thing to do. But again, I don't think the intent here is to lead innocent, unsuspecting people to their trading destruction. Besides, if a person dealt with their fear, and then decided not to trade, but they were better equipped to deal with fear in all the aspects of their life, then what's the down side? I don't see a lot of downside potential in taking a look at what Rande has to offer.

[SIUYA 11]

I look at it this way..... if I was employing Steve I would do so as an analyst, and then employ someone who may not be very good at the analysis but has no fear about the markets.

Sometimes people are just not designed to do certain things very well. Now while it could be argued that all it takes is training/handholding/whatever..... often you cant make a monkey into a race horse and while the effort to do so may eventually work out, maybe that effort is better applied elsewhere.

 

I would also like to add, and its an often avoided topic, is that there are many traders who dont have fear, and when you combine that with the ignorance Steve46 mentions'....disaster.

I have seen more blowups because of this than with issues of fear of the market.

How do you deal with those people who dont have enough fear Rande?

[steve46 12]

There is good fear and bad fear. Good fear would be if you were afraid to feed a family of hungry bears, who might eventually look at the flesh on your bones as a good meal. Bad fear would be if a person couldn't leave their house because they had a phobia of the outside world. I describe these two opposing and extreme examples as a way to compare and contrast, and give perspective to the understanding of fear.

 

Please don't misunderstand me, I'm not discounting your good advice to keep incompetent and untrained people to go off blindly trading. I don't think the intent is to lead incompetent and untrained traders into mindless danger.

 

Because trading has such a high attrition rate, and has the potential to do a lot of damage, it's a good thing to warn and/or discourage people from getting into something they are not prepared for. So, having a concern for naive and unwary traders, and the desire to protect them from themselves, is an honorable thing to do. But again, I don't think the intent here is to lead innocent, unsuspecting people to their trading destruction. Besides, if a person dealt with their fear, and then decided not to trade, but they were better equipped to deal with fear in all the aspects of their life, then what's the down side? I don't see a lot of downside potential in taking a look at what Rande has to offer.

 

Well first tradewinds. I agree with you on this point..I think it is a good thing to "take a look" at what Rande has to offer....Absolutely and why not....however, as with any product, or service, one needs to have a way of evaluating, of thinking critically about the subject...and one way of doing so (in my opinion) is to have a reasonable alternative commentary. One that points out flaws (if they exist) in the vendor's proposal....

 

Also Tradewinds, I have no problem with a person promoting themselves and their business...here or elsewhere....clearly that is what Rande is doing, and if HE doesn't do it, who will....that applies to us all...we have to promote our own agenda.....that said....evaluating that agenda is up to the individual...but I have no problem with it...

[steve46 12]

I look at it this way..... if I was employing Steve I would do so as an analyst, and then employ someone who may not be very good at the analysis but has no fear about the markets.

Sometimes people are just not designed to do certain things very well. Now while it could be argued that all it takes is training/handholding/whatever..... often you cant make a monkey into a race horse and while the effort to do so may eventually work out, maybe that effort is better applied elsewhere.

 

I would also like to add, and its an often avoided topic, is that there are many traders who dont have fear, and when you combine that with the ignorance Steve46 mentions'....disaster.

I have seen more blowups because of this than with issues of fear of the market.

How do you deal with those people who dont have enough fear Rande?

 

Siuya I apologize if I am interfering, but your comment is very important to me....I maintain a presence in the overseas markets, including the DAX futures....I remember a colleague asking me if I would help him to learn that market...(he wanted to participate)....okay, so I said "look, the DAX has the potential to act in a very volatile manner...(at the time that was particularly true).....and if you get caught on the wrong side it can spike on you and really hurt you....he wasn't deterred, but wanted to get going....(of course)....well I think this was an example of a person who lacked sufficient fear......he simply did not take my warning seriously AND he did not understand (until he found himself in a losing trade....in a market spiking down on news...with no buyers to take him out....sitting there looking blankly at the screen while his account took a beating...)

[jaysmith124 10]

I observe my thought processes. I am constantly trying to be aware identify problematic beliefs. Taking the situation out of context. Mindful of self talk(feeling) being extreme, exaggerated, positive, or negative.

Is my belief habitual? Do I need to challenge it, and identify alternative interpretations that could be possible? A more accurate reflection of my reality?

Here are some distortions I may find in others, and/or in myself.

black and white thinking, all or none thinking, self blame, mind reading, catastrophizing, overgeneralization, heaven's reward fallacy, fallacy of change, fortune telling, "Should" statements, labeling, being right, personalizing, jumping to conclusions, negative filtering, minimizing the positive, emotional reasoning, control fallacy. confusing the emotional consequences of a low probability outcome with a high probability outcome. (Or, visa versa.)

 

Dealing in an environment of uncertainty takes a certain personality. One situation carries a different emotional intensity for some than for others. Many do not survive, because they fall victim to fear based emotions, and a fight/flight, avoidance, state of mind. Decisions and behavior become irrational. No logic, no reason. People end up dead because of panic when lost in a wilderness environment. They drown in oceans, lakes, and pools because of panic. Well, we don't die in the stock market, but we do ask ourselves, Why did I do that?

 

But with enough training, and practice, at graduating levels many can build self-efficacy by testing new hypothesis(beliefs) in this particular environment. Some need more time than others, so what.

 

What am I afraid might happen?

What does this mean if it is true?

What does this mean about me, my life, and future?

What is the worst that can happen if it is true?

What is the reward I get for not pulling the trigger?

What will other people(s) feel and think about me?

Am I comparing myself to others?

 

Mindfulness has helped me get to know myself better, and to take away the emotional garbage. There are no hard rules, and it takes balance. The focus should be on what works, not necessarily needing to know why. I know why I do most everything, and why I feel the way I do. I believe I will start trading for a living real soon here after much work over the last year and a half. I am "Cool Headed" as opposed to anxiety ridden, and on the verge of panic, as in the past. I am very thankful I have not given up.

[MightyMouse 12]

I look at it this way..... if I was employing Steve I would do so as an analyst, and then employ someone who may not be very good at the analysis but has no fear about the markets.

Sometimes people are just not designed to do certain things very well. Now while it could be argued that all it takes is training/handholding/whatever..... often you cant make a monkey into a race horse and while the effort to do so may eventually work out, maybe that effort is better applied elsewhere.

 

I would also like to add, and its an often avoided topic, is that there are many traders who dont have fear, and when you combine that with the ignorance Steve46 mentions'....disaster.

I have seen more blowups because of this than with issues of fear of the market.

How do you deal with those people who dont have enough fear Rande?

 

Good point. Nice of you to come into the cabin of your yacht to post.