When I was a commodity broker for Merrill Lynch (yeah, over 3 decades ago), my clients who lost the most money tended to be doctors and lawyers. This is because they were so used to having the power to shift their environment, that they just assumed that because of the power of their personality, their status and their brainpower, they could beat the markets.
This attitude was very expensive for all of them.
There are some attributes that work very well in our relationship with other people and in our careers, that not only don’t apply to trading but are very expensive when we apply these same productive methods to trading.
And this brings us to the case study of Kim.
Kim came to trading after retiring as a commercial airline pilot. As one of the early females who broke through the glass ceiling in the airline industry, she had a tremendous amount of internal resources and drive to become the success that she experienced. But that success did not translate to her trading profits.
She had constructed a well-designed trading plan and strategy, but in the heat of the moment she would make impulsive trades, revenge trades, get out early to avoid giving back profits, and all the other emotional trading patterns that most of us can empathize with.
But Kim had an internal resource that she hadn’t tapped fully.
As a commercial airline pilot, she was able to construct a “strategy” about her flying, come up with a checklist, follow air traffic control instructions, and do all of this very skillfully. So all we needed to do was to bring this incredible resource that she already had in her brain to her trading processes.
To make this a lot of fun, she brought her airline uniform and hat into her trading room and wore them as a very physical anchor to that part of her brain that knew how to create a plan and follow it. Once she experienced the competence of being an airline pilot in her trading, the emotional trading behaviors evaporated.
So the question for you is, what resources do you have that are detrimental to your trading, and what potential resources do you have that can support consistent trading behaviors?
If the resources come from the force of your personality and your career, just like the doctors and lawyers, this is unlikely to be helpful. However if your internal resources come from learning a skill, applying that skill, getting feedback, adjusting your abilities, learning what works and what doesn’t work, and having had done that successfully – then that may be a resource that you can apply to your trading.
What you can do is make an inventory of your past successes, no matter how large or how small, and look at the attributes of those successes that do in fact apply to trading. Then, like Kim, you can create an anchor that brings those skills into your real-time trading.
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