Master Your Emotions ... Or Else! - Stock Trading Forum | Forex Forum

Option Prophet · #1 (**permalink**) 03-05-2008, 11:42 AM

Whether you're content with pitching dimes into a fountain or you rely solely on the revenue you generate through your trading, your emotions play a vital role in whether or not you successfully or unsuccessfully achieve your desired result.

It's not just the reaction we display as a result of a specific event, better yet, it's how we perceive the event prior to and how we react to it during the process.

I'm referring to emotions.

Emotions - Powerful word - Powerful tool - Power... inent of itself!

If you are hot tempered and quick to cast blame on none other than the one staring back at you in the mirror, then perhaps you may want to hold off on trading live capitol until you have these destructive tendencies completely under control.

A healthy mind, a healthy body and rational patterns of thinking, combine to persuade your approaches to trading successfully.

If you were a Kickboxing Champion, you wouldn't train for a World Kickboxing Title by cutting back on your sleep, not following a proper diet and exercise plan and cutting out on your sparring sessions..... would you?

I would hope that all of you would answer with a solid NO!

Trading is no different than Kickboxing - at least the way I see it.

*You're in to win

*Your self esteem and pride are in the balance

*You have potential losses at risk

*The unknown is waiting in the shadows to either pounce or bounce

There’s a lot of pressure - lots of stress when you lay it out there and put your best on the line ... right?

Nobody likes to lose.
Everyone (at least the people I know) enjoy the rush of winning.

But in the grand scheme of things losses are inevitable and help to keep the balance of your winners in check.

These factors play key roles in how we interpret how we presently view these events in attempt master our emotions.

You need to know if you are able and should trade on any given day.

Only you know if you should or shouldn't trade on any given day.

Just as having a healthy account size, a proven trading plan and a method on how to approach the markets each and every day, you need to bring yourself, in full, to the market.

Just a few tips on how to better your outlook:

*Get enough sleep

*Repetition is key

*Have a pre determined outlook on your trade decisions

*Have a comfortable place to trade - free of distractions

*Stick to your plan

*Don't over react emotionally to any abrupt or blind hits - your plan should see you through it

*Maintain a positive outlook - no matter what!

Cash · #2 (**permalink**) 05-03-2008, 08:30 PM

Option Prophet you are good, you hit the nail squarely on it hit. I'm coming around to being a more consistent trader. I had to lower my share size to do so. I thought trading 500 or 1000 shares would get me there faster and would have no different effect on me. I was wrong! I'm trading 200 share size now.(soon to bump it up) I'm in my trades a little earlier, not second guessing. And I'm staying in longer. Plus I'm not getting wiggled out as much. So basically my batting average has increased now that I'm looking for doubles or triple. I still occasionally get a home run.

I now get a run of green days and then a red day every so often. I still haven't completely lose the negative emotion of losing. Just the other day (Friday) I was down $9.00 and the morning session was over, I was going to quit. But I couldn't leave it alone, couldn't be red. So I gave the market another $200.00 Duh! I was more peeved off at me for not follow my own rule. I knew them I just didn't want to....be a loser...lose... be wrong....have market get a dime from me. "I'll show them"

Every 3 or 4 months I get that attitude, I don't see it coming or while I'm in it. But I sure see it afterward. Ouch!

Ken · #3 (**permalink**) 05-09-2008, 04:55 PM

Great posts; thanks - agree w/you both... being consistent, mechanical, objective is important, to smooth out the emotional peaks and valleys ... and if you stay true to your stops (keeping them small, .4 for daytrades, 1.5 max for swings, or whatever you use).. then you'll be more confident... plus if you're more selective, and also diversify during volatile breakout times.

Been there, done that too Cash... that's why I put on my "show me I'm a skeptic" traders' hat (figuratively speaking) for all mondays, fridays and days before/after major holidays, because they're usually low volatility, as were summers (though summer's been ok the last couple of years). Gold time is tue-wed-thur 9:30-10:30am.

-k