The reason why people want to become a trader IS the same reason why most traders fail.Mar 08, 2022
The reason why becoming a trader for a living is so attractive for many people is not just because the unlimited financial gain opportunity, but mostly because of the freedom and independence that this type of “job” offers.
(And I put the word job in quotes, because being a trader is more of a lifestyle and a mindset, rather than just what you do for a living. And I am sure those of you, who have been trading for a while now, might have gotten a gist of the difference)
The perspective of working from anywhere, living on your own terms, having no boss telling you what to do, making your own decisions and on top of it all generating lots of money easily just pressing the buy and sell buttons, is just too good to pass on. It's a dream life for many people.
However, what most do not realize is that their idea of how trader's life looks like, is in fact sabotaging them in their efforts of bringing this image to life.
And here are the two main reasons why. The first one is:
- Freedom is power that not many are able to control
Having freedom as a trader is not about doing and thinking whatever you want. In fact having that kind of freedom is not working for most people in general, especially if it comes to realizing ambitious goals. And let’s face it, trading for a living is a very ambitious goal.
Not many people have the discipline to motivate themselves to action. The recent pandemic gave us a good taste of that, I think. But being consistent in your actions is a whole other level.
Consistency requires full commitment on your part. That means that your trading goal is your priority and everything else needs to support your efforts. And moreover, it requires persistence and perseverance.
Having freedom allows you to arrange everything around you to help you achieve your trading goals. But that includes compromises and full dedication to the process. Not just doing whatever or having the attitude of "I'll see how it goes", because this most likely this will turn into "I see it going away from me".
The freedom you get as a trader, cannot be misunderstood if it comes to your thinking. Yes, you can think what we want, but unfortunately it is not very effective in trading. Because instead of using thinking to help you to make money you will be talking yourself down and out of trading decisions you should make. We, people tend to find ways to talk ourselves out of things that are good for us long term!
And more often than not, we choose to think about what makes us anxious and unhappy. And we keep telling ourselves stories that stop us from pursuing our dreams. “I am not gonna succeed”, “I am a loser”, “This does not make sense”, “This is just too difficult”...
When you are a trader these ruminating thoughts are an absolute killer of your success. So, while you have all the freedom to think what you want, you need to be constantly alert. Trading is a mental game and you need to become your mind coach. Because even one thought that is not supporting the goal, can cost you a lot of money.
I like to compare trading to an athlete’s performance. You have just a few hours during the market open hours to shine. But all the other hours are for preparation, physical and mental. And it is up to you to get ready to perform on the highest level possible. To increase your odds to win. To exclude any distractions that might take your mind away from what’s needing your attention.
Remember, you have the freedom to choose to succeed. It’s up to you to make that decision and follow through on it.
And the second reason is:
- The desire for independence without follow through
The image of independence for most traders is about “I can do whatever I want” and “nobody will control me”.
Not many want to see, that in order to trade successfully you not only need to have a strategy that gives you high odds to win, clearly defined goals and a plan on how you will realize those goals, but first and foremost you need to be able to implement it.
Which means that your success as a trader fully depends on your ability to follow through on your trading strategy and your plan.
In order to do that you have to become your own boss that sets very strict rules and has the discipline to obey them. You must become like a hawk making sure you are not deviating from your rules on one hand, and on the other have the flexibility to adjust your plan when conditions require it.
And a lot of times you need to make difficult decisions that cause you an emotional pain. And only you will bear the consequences of your decisions.
It’s not very easy to do the right thing when your comfort is compromised, when you feel fear and your emotions are at play. Especially, if “the right” decision must be taken in a matter of seconds and there is now way to tell if it’s right or wrong.
And if you are not aware of what is happening on a deeper level throughout this entire process and you just react to triggers, your sabotaging mechanisms will make your decisions for you.
According to neuroscientists about 95% of how we do things is pre-programmed. And a big chunk of that programming are protection mechanisms we developed based on our life experience. If you don’t know which of them are sabotaging you in your trading, you are no longer in charge.
You basically surrender your independence and your ability to do what’s right to the subconscious program, which makes you repeating the same mistakes over and over again.
The reason why most traders fail is sadly because they don’t have the discipline to always do what’s right; and also because they do not have the desire to do the work and discover how to get out of their own way.
Freedom and independence comes with responsibility. If you want to be free and independent you need to understand that you own the outcome. You are responsible for the results of your actions, which means you must always act in your own best interest and not against it.
Traders who do not take this responsibility seriously or do not understand what that means in trading, pay a very high price. Most of the time the price is higher than they want and can afford.
If you like to know more, CLICK HERE to download this free training and learn about how misalignment of expectations impacts your trading on a daily basis and how to use the power you have to your advantage.
Remember, only those who can commit to a sustained effort of action over the long term and use the freedom and the power they have at their disposal – have the chance to succeed. And you don't have to be a mindset coach to do that.