PRIDE GOES BEFORE A FALL
“When trying to master a challenging profession like trading, it’s easy to react with overconfidence and unrealistic optimism. When your hopes are dashed, however, it’s hard to continue fighting. It may not be useful to be a pessimist, but it is essential to be a realist… You must think positively, but it’s also vital to have realistic goals… If you can cultivate a winning mindset, you’ll be able to handle anything the markets throw at you, and you’ll end up a winning trader in the long run.” – Joe Ross
I’ve always been an advocate of transparency in trading: reiterating that it’s professionally sensible to show profits and losses, plus how one moves ahead despite these. Many a so-called professional who talks on financial media tend to give an impression that the markets can be predicted. They make reference to an earlier prediction which comes to pass; but they’ll never make any reference to their previous forecasts which flopped. It’s not uncommon for those who speak on television and radio to talk of the direction they think the markets are going. Many (novice) traders like to ask: “Which direction is this instrument going? They won’t ask how they can make profit from the market whatever the directions of the markets are.
Philipp Kahler is a nice example of trading professionals who talk about losses and profits inherent in any trading system, including his own, plus how you can move ahead irrespective of these. Yes, I talk about my profits and losses in my analyses, and my subscribers also have access to seeing how I make overall profit irrespective of inevitable losses. I do this for professional purposes, not to show off or flaunt any skills. It’s also because many people won’t understandably believe if they don’t see any evidence. If you think you’re a good trader, then show your prospective clients or trainees your track records.
But there are times when it’s not sensible to show your trading results. This is the reason for this article.
When you’re at a party, socializing with strangers and acquaintances, it’s tempting to reveal your account history to them so as to impress them. You might want them to develop deep respect for you, thinking that you’re a super trader. Many people are interested in becoming financially free by earning consistent passive income, and they may suddenly become your friends because of what they think they can get from you. If you told people about a profitable position you were holding, what would you do if the trade later went against you? You might need to disregard your Stop Loss, thus violating your exit rules. You’d be determined to hold onto the position for as long as possible with the hope that the market might turn in your favor. You’d want to be right with the trade, and the overwhelming desire to be right with every trade usually ends in financial disaster.
If you eventually lost your socks with the trade, would you tell your new chums? If your new friends later asked about your open position, you’d be forced to tell them lies. Trying to meet their expectations might even color how you handle trading decisions. That’s one example of how a useful trading professional might became a useless professional – for showing trading results for wrong motives.
It’s crucial for you to avoid allowing your self-esteem to cloud your trading results. It’s thus judicious to keep your comments in the public sensible as far as your trading activities are concerned. The more you declare yourself publicly as a “super trader” the more strenuously you would have to grapple with the markets, struggling to be always right so that you could remain a celebrated super trader.
Please read what Joe Ross has to say more about this issue, so that you don’t flaunt your trading results solely for selfish and egocentric reasons. His quotes end this article.
1. “Trading is hard enough, why introduce additional social and psychological pressures that will adversely influence your trading results? Stay humble and quiet. There is no logical reason to discuss the specifics of your trading career socially. It’s often done just to build up one’s ego, and enjoy the attention of others. You’ll pay a long-term price for this short-term gratification. But if you can just stay quiet and keep the specifics to yourself, you’ll avoid embarrassing questions and comments that will interfere with your trading.”
2. “The attention may be enjoyable at first, but a need to maintain this reputation may impact your trading attitude and your ability to maintain an objective, emotion-free mindset.”
3. “The added pressure to perform so as to impress others may lurk at the back of your mind and impact your trading decisions. It’s better to avoid getting into such a mess. Keep your trading activities to yourself. Find something else to talk about. You’ll make your life easier.”
Your questions and opinions are highly welcome.
With best regards,
Forex Signals Strategist, Funds Manager &Coach
Yahoo! Messenger ID: saazalmu
Get my Forex trading signals at: http://www.fxinstructor.com/en/analytics/ituglobal
And my past articles are also available at: www.ituglobalforex.blogspot.com
NB: There is risk of loss in trading, but it is possible to be a successful trader.
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