Is The Market Out To Get You?

| August 4, 2010 | 0 Comments

A trading buddy of mine has what I call the “trading willies”.  He’s having a run of losing trades.  It’s been going on for a few months and now the willies have got him…

What the heck are the “trading willies” you ask?

The willies may show up after a string of losing trades…

They’ll make you scared to enter a trade.  You’ll start questioning your ability to pull in profits.  You’ll start thinking every trade you put on is destined to be a loser.

When you have the willies, you feel the market’s out to “get” you.

You’ll feel like the markets are toying with you.  Like somebody’s taking the opposite side of your trades and forcing them to be losers.

Having the willies is frustrating.  And it’s easy for them to show up in challenging market conditions.

Conditions like we’ve seen recently…

The incredible volatility has even the best traders sitting on the edge of their seats.  You have to be on top of your game.  And part of being on the top of your game is knowing how to combat the willies.

You see, every trader at some point gets the willies…

One of the hardest parts of trading is keeping a good attitude.  Yet having a good attitude is essential to making it in the business.  Anything less will eventually send your trading results into the dumpster.

Now I’m sure you’ve probably heard the “attitude” speech a million times over the years.

Your mom or dad, your high-school teacher, maybe it’s a role model you’ve had for years.  They all say the same thing… “A good attitude goes a long way.”

Now having a good attitude is one thing.  But I’m going a step further showing you how to systematically do away with the willies.

It’s time to say goodbye to the “trading willies”…

Clearing your head of the willies is essential to a profitable career in trading.  You’ll be more effective and relaxed in your trading once you learn how to deal with them.

You see, they are nothing more than a mental “hitch”.  When the market “gives” you the willies, all you need to do is adjust the way you think.

But here’s the trick…

The market doesn’t give you the willies… you give them to yourself.

The willies are your ego protecting itself.  Your ego equates losing trades with you being a loser as a person.  And your ego thinks what happens in the past will happen again.  The more you lose, the worse a person you are.

So you begin to believe losing trades are something to be afraid of.  This kind of thinking will quickly make trading an impossible task…

You need to change your attitude to clear your mind!  You won’t last long with a case of the willies…

Here’s a three-step process to getting rid of them.

The first step is making peace with the market…

The market is not out to get you.  It never has been and it never will be.  If you feel like the market has your number, you need to adjust your strategy to current market conditions.  Your trading results are due to your strategy.

The second step is coming to a simple realization…

Losing trades are a part of every trading strategy.  You can’t escape this fact.  And realize you can’t take losses personally.  You’re trading results have nothing to do with your worth as a person.

And the third and most important step…

Make each trade independent of all the others.

Thinking your next trade is going to be a loser just because your last one was is just silly.  This is like being scared of getting a flat tire every time you drive… just because you had a flat last Friday.

Hanging on to your past trades is the prime ingredient in the willies!  Once a trade is over, winner or loser, it’s done.  Move on to the next one.

So there you have it…

If you have the “trading willies”, now you know how to get rid of them.  You’re free to jump back in the markets once you’ve got the willies out of the way!

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Category: Stocks

About the Author ()

Justin Bennett is the editor of Commodity ETF Alert, an investment advisory focused on profiting from the ebb and flow of important commodities via ETFs. The commodity veteran and options specialist is also a regular contributor to the Dynamic Wealth Report. Every week, Justin shares his thoughts with our readers on a variety of commodity-related topics. Justin is also a frequent contributor to Commodity Trading Research’s free daily e-letter. And he’s the editor of another highly successful and popular investment advisory, the Options Profit Pipeline.

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