For anyone out there who knows me (mainly from the J16 thread) you will know that I've been having a difficult time trading of late.
Infact I'm supposed to be having time out to clear my head because something is fundamentally wrong. My win/loss ratio in picking trades through price action is good, I can hold my winners (although I do sometimes still close a little on the early side), I cut my losses quickly and yet I lose money consistently. I have found out that this is down to my risk management and yet I really think I understand the principles of money management clearly - I just can't follow them.
Well Saturday it was my birthday and I got talking to my girlfriend about my trading. She is not a trader but she is very logical and she is a good listener and has a habit of getting me to think about the right things.
We were supposed to be going out to celebrate but in the end we talked for hours and it was all very serious and there were tears and there were realisations.
A long time ago, I read Market Wizards and I remember Seykota's statement: "Everyone gets what they want out of the markets" and I also remember the interviews with the psychologists that talked about working with traders who had issues with their self worth and who actually wanted to lose and I remember thinking - "This is rubbish - who actually wants to lose? We are all in this to make money."
But talking to my girlfriend yesterday about my trading, I was just being myself and being truthful and it seems like it was the first time in ages that I have allowed myself to be like that and one part of the conversation in particular, went like this:
Her: "What do you like about trading?"
Me: "I like the drama. I like the fact that a trader lives and dies by the sword. There is an incredible sense of self worth to be achieved as a trader. I guess deep down I have always felt like I have never succeeded at anything and trading gives me the opportunity to not only succeed but to do it in a big way - to achieve what few else can and have done."
Her: "And you like to tell other people around you about your achievements?"
Me: "Yes - without a doubt. I always tell people. I suppose I'm boasting."
Her: "What would be your ideal trading related boast?
Me: "Well, my ideal boast would be to say to someone - I lost five million pounds today and be very cool about it.
Her: "But why would you boast about losing?"
Me: "Because if you can lose that much money and still be standing then you are obviously worthy of respect"
Her: "So what you are saying is, that losing is, at least in terms of the story you tell people, better than winning and that really to be respected, you aspire to lose."
At this point it really dawned on me what I was saying and was happening when I trade.
There are lot of issues in my trading but this is certainly key: I really think that on some level I want to lose and my trading history reflects this - when I start with a small amount of money, I have always run it up phenomenally well and then sabatoged my own progress.
I wanted to post this here to see if anyone else could relate to this at all or just to encourage others to post their own thoughts or psychological issues or even turning points where they realised that mentally they were on the wrong path and are trying or have actually succeeded in turning it around.
Thanks for reading.
Wiz
Infact I'm supposed to be having time out to clear my head because something is fundamentally wrong. My win/loss ratio in picking trades through price action is good, I can hold my winners (although I do sometimes still close a little on the early side), I cut my losses quickly and yet I lose money consistently. I have found out that this is down to my risk management and yet I really think I understand the principles of money management clearly - I just can't follow them.
Well Saturday it was my birthday and I got talking to my girlfriend about my trading. She is not a trader but she is very logical and she is a good listener and has a habit of getting me to think about the right things.
We were supposed to be going out to celebrate but in the end we talked for hours and it was all very serious and there were tears and there were realisations.
A long time ago, I read Market Wizards and I remember Seykota's statement: "Everyone gets what they want out of the markets" and I also remember the interviews with the psychologists that talked about working with traders who had issues with their self worth and who actually wanted to lose and I remember thinking - "This is rubbish - who actually wants to lose? We are all in this to make money."
But talking to my girlfriend yesterday about my trading, I was just being myself and being truthful and it seems like it was the first time in ages that I have allowed myself to be like that and one part of the conversation in particular, went like this:
Her: "What do you like about trading?"
Me: "I like the drama. I like the fact that a trader lives and dies by the sword. There is an incredible sense of self worth to be achieved as a trader. I guess deep down I have always felt like I have never succeeded at anything and trading gives me the opportunity to not only succeed but to do it in a big way - to achieve what few else can and have done."
Her: "And you like to tell other people around you about your achievements?"
Me: "Yes - without a doubt. I always tell people. I suppose I'm boasting."
Her: "What would be your ideal trading related boast?
Me: "Well, my ideal boast would be to say to someone - I lost five million pounds today and be very cool about it.
Her: "But why would you boast about losing?"
Me: "Because if you can lose that much money and still be standing then you are obviously worthy of respect"
Her: "So what you are saying is, that losing is, at least in terms of the story you tell people, better than winning and that really to be respected, you aspire to lose."
At this point it really dawned on me what I was saying and was happening when I trade.
There are lot of issues in my trading but this is certainly key: I really think that on some level I want to lose and my trading history reflects this - when I start with a small amount of money, I have always run it up phenomenally well and then sabatoged my own progress.
I wanted to post this here to see if anyone else could relate to this at all or just to encourage others to post their own thoughts or psychological issues or even turning points where they realised that mentally they were on the wrong path and are trying or have actually succeeded in turning it around.
Thanks for reading.
Wiz
).
I'm wondering if most really successful traders worry a lot about whether they are in the right frame of mind when they trade. I believe they see problems they may be having and correct them, but I don't think they worry about the psychology of trading all that much. Sure, it's ok to have some knowledge of what makes you tick, just don't dwell on all the Freudian stuff. Keep it simple. Just my thoughts, hope not to offend.