Posted: 19 Aug 2010 02:41 AM PDT I wrote this article on July 2, 2009. It’s been well over a year and I know that many new folks have never seen it before. During this month, I’ll do re-postings of my best educational content because new folks who barely know me never got the chance to read my past posts from 2008/2009. It’s also nice for me to edit the articles to make them slightly better, otherwise known as ’2nd edition posts’. If you read my archives, then it’s simply nice to have a refresher once in a while. I do hope the re-print articles help in some way. —————————————————————————————— Fear, and it’s powerful ally – worry, ruin more ideas, intentions, business transactions, and the vitality and energy of more people in the world than any other single thing. The USA has become a nation of worriers. If you intend to build a strong, successful trading future for yourself, you must learn to eliminate unhealthy fear from your thought processes. Besides the ruinous forces of fear, it can also be one of the greatest motivating forces in the world. Shakespeare said, “To fear the worst, oft cures the worst”, meaning that sometimes a good scare accomplishes more than good intentions. Why do we learn? We get an education because we are afraid of being ignorant. I mean, come on, you don’t want to be following my trades forever, right? Most people obey the law because they fear punishment (Unless you’re Bernie Madoff). You take a shower and brush your teeth everyday, hopefully, because you have a healthy fear of disease. The point it, some types of fear have value. Fear forces you to think about things you might not otherwise worry about. However, the negative kind of fear will cripple and debilitate you mentally and then destroy you and your dreams, if you let it. This unhealthy fear will inhibit you and prevent your progress towards success in whatever you do, in this case, trading. It holds you back, prevents you from ‘pulling the trigger’, restricts you from taking advantage of the ideas you create, and in the end, stops you from taking action, until it’s too late to act. In essence, you become your own worst enemy. There is no one or nothing you can blame but yourself if you let fear take over your life. Ask yourself, “what are you afraid of”? Are you afraid of losing? Stopping out? Taking profits too early? Deviating from your system? Events outside of your control? What in the world can be so scary that it prevents you from trading effectively? Whatever it is, this fear will prevent someone with great potential from going as far as they might have otherwise. This type of fear usually becomes a self-fulfilling prophesy if it is allowed to grow (being fed by you, of course). Basically, you will lose before you are even given the opportunity to consider any victory. Where does this fear come from? When you were a kid, did you ever burn your hand on the stove? I bet you didn’t touch the stove ever again. Or, if you were a rare case, you kept touching the stove and it took you a while to figure it out. The point is, these fears are usually well-grounded by events that took place in the past. Perhaps you suffered a huge loss, or a string of losses. Your confidence got sapped. I tell my students all the time, “don’t dwell in the past in order to see the future”. This is an obstacle that only you must defeat on a personal level. How do you deal with this? It must be done in a straightforward manner. Most likely, each fear developed from a bad experience. We all fail, and we all lose, and this can be extremely demoralizing. When you fail, it is likely that you will start believing that you will fail again. Here are some solutions for some of the more common psychological issues related to trading:
Once up on a time, there lived a little mouse. He lived in constant fear of a cat that lived in the village. One day, a powerful space alien magician came to town. “M’lord,” the mouse begged of him, “thou art wise and powerful, and my life is most miserable because of a cat. Woudst thou return joy into my life by making me into a cat? Then I would no longer live in fear.” The magician smiled, raised his wand, said some magical words, drew some lines on a chart, and the mouse found himself a cat as he wished. But, he was the most frightened cat in the land. A dog that had been of no concern to him before, now made his life unbearable with fear. Every time he ventured out of his out, the dog chased him. The cat, desperate with fear, went back to the magician. “M’lord,” he said, “being a cat is most miserable because of a dog. Wouldst thou return joy to my life by making me into a dog? Then I would no longer live in fear.” The magician obliged, and the cat became a dog. But he became a dog that lived in constant fear for there was a huge tiger that lived in the forest and made his life…miserable. Again, this poor creature set out for the magician. This time he asked to be made into a tiger, and it was done. Suddenly, the tiger now found himself in the most terrifying circumstances he had ever known. Hunters came into the forest with rifles and dogs. They even set out traps for him. He had never known more fear than he did now. Finally, the magician was asked by the tiger to be made into a man, that he would fear nothing from that day on. For the first time, the magician spoke. “As a mouse you knew nothing of cats. As a cat, you knew nothing of dogs. As a dog, you knew nothing of tigers. You know nothing of sickness, old age, or failure. You know nothing about finding and losing a job. No, I will not make you a man, I will again make you a mouse, for in your heart, you are a mouse anyway.” Moral of the story: Don’t be a mouse. |
Posted: 19 Aug 2010 02:33 AM PDT I wrote this article on September 20, 2009. It’s been almost a year and I know that many new folks have never seen it before. During this month, I’ll do re-postings of my best educational content because new folks who barely know me never got the chance to read my past posts from 2008/2009. It’s also nice for me to edit the articles to make them slightly better, otherwise known as ’2nd edition posts’. If you read my archives, then it’s simply nice to have a refresher once in a while. I do hope the re-print articles help in some way. —————————————————————————————— The most dangerous enemies of success are those that hide somewhere deep in your own heart and mind. Those who say that the want success and yet hang onto the attitude of failure are deceiving themselves. Almost all failure is generated within a person’s inner self, through their thoughts and attitudes. Looking through some history, Aristotle warned Alexander the Great that the most immediate dangers confronting his success were enemies within his own ranks. As you may know, the Macedonian army was rife with disloyalty, drunkenness, carelessness, etc. On an individual level, these actions could have been prevented by having a proper attitude. Let’s fast forward to now. A few years ago, a survey was conducted by a life insurance company to determine why unsuccessful salespeople failed. Here were the results: 37% failed because of discouragement 37% failed because of lack of industry 12% failed because they didn’t follow instructions 8% failed because of a lack of knowledge This should come up to 94%, and all four areas are directly related to individual attitude problems. Discouragement is caused by poor mental posture. Lack of industry is cause by a general bad attitude. Failure to follow instructions means you’re just lazy and have a lazy attitude. Finally, a lack of knowledge comes from a mix of everything above. Most of the salespeople failed because their attitudes broke down well before they even displayed their failures through their actions. It’s all about attitude. In war, morale is the first defeat in any war. One side always loses heart before they are actually beaten on the battlefield. The side that believes in their ultimate failure will fail, no matter what other circumstances exist. A negative attitude almost always starts small and as you cling to it and believe it, it grows like a virus. When this virus gets to become so strong, it will overwhelm you until you break down. Sometimes, the psychological effect is so great that it can actually breakdown the central nervous system. A good attitude doesn’t come instantly though. It does not come from solving one big problem in your life. It comes from solving a lot of little problems, proving to your mind and others that you can overcome anything. For example, if you are consistently losing on your trades, take it day-by-day and isolate each problem and solve it. You have to train yourself to believe in yourself that you can overcome the difficulty of losing. You will most likely lose if you think that you will lose on a trade before you even place the order. The quickest way to go from a bad attitude to a good one is through taking positive actions. Theodore Roosevelt once told a crowd of politicians before a major vote in Congress, “If you want to be brave, then start acting brave.” He didn’t say, “have brave thoughts.” He clearly wanted action. You’ve heard that action speaks louder than words. Well, that applies equally to thoughts that lead to success. You must take action to become better. You can’t make successful attempts without first beginning with a successful attitude, and only you can make that choice. Suppose that nothing goes right for you, still. Do you quit? No. No matter what happens to you, you can turn the “bad” experiences to your good. Some people wish they could always have things exactly the way they want. However, suppose you could always have your own way – you would never make a mistake, never be opposed, never know trouble or failure. And…you would never develop the strength that comes from opposition, or the feeling of exhilaration that comes from success. Problems can become your best teachers. Remember Edison? He tried over 5,000 times to make a light bulb that wouldn’t burn out without success. He learned something from each failure until he eventually succeeded. Even Shakespeare knew about failure when he said, “The best men are often molded from their own faults.” Listen, whether something is a problem or not, it’s all in your head anyway. You have to realize that your life (and trading career) can be whatever you let it be. You don’t have to let every little failure be a total wreck. Instead, tell yourself, “If there’s to be trouble, let it begin here, and let me be the one to handle it.” Apply these principles to your trading. |
PulseWave Trading "Trigger Trade System" Daily Stock,Forex & Futures Analysis and Commentary.
Thursday, August 19, 2010
8/19/2010 - Fear and Attitude
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment