In previous articles I’ve discussed that trading losses can be internally orchestrated by the Self. These losses help transform traders’ emotional states, attitudes, and worldviews. The losses are good for character development, but not the pocket book.
The Vocational Trader
If trading is an individual’s vocation, then the vocational trader may resist his calling by continually losing. Then he’ll say, “See! Trading just isn’t for me. I’m a loser.” If the vocational trader gives up now and quits trading, he won’t rest easy. The Self will plague and torment him until he returns to trading.
The best way through this self-imposed conflict is to face the resistance. Take responsibility by mentally saying, “I want to lose to get out of the difficulty of trading. I will discover how I’m tricking myself and will see through the trickery and persevere. I will embrace my vocation by winning.” The attitude illustrated by the mental affirmations is the attitude to be cultivated. If the trader successfully navigates these dangerous waters, he will avoid further Self-torment.
The Non-Vocational Trader
On the other hand, if the non-vocational trader (the money grubber?) starts losing continually, the Self could be directing this trader to quit trading and discover his actual vocation. If this trader resists giving up, the Furies will pursue him until his life falls completely apart. Only then will he let go of his obsession for money, fame or whatever else is misguidedly driving him and follow his true calling.
Novice Trader, Competent trader, Expert Trader
All the losing scenarios discussed in my articles could conceivably occur at the various levels of trading expertise. According to Dr. Brett Steenbarger in his excellent book, Enhancing Trader Performance: Proven Strategies from the Cutting Edge of Trading Psychology, there are trader developmental stages. Based on performance, a trader can be a novice trader, a competent trader, or an expert trader. The Self may choose other ways besides losses to help develop the character of the expert trader and even the competent trader.
Can you think of other internally-based, not performance-based, reasons for trader losses? I will discuss more internally-based reasons for trader losses in upcoming articles.