A good friend of mine shared a link of this article “Trading Without Ego” by Ruth Barrons Roosevelt. I recommend you read it. What’s most memorable here, and perhaps my own perceived difference in my own trading now, is that I don’t associate my ego anymore from my trades. If the FED intervened today, giving me a good profit, I don’t pat myself on the back, telling myself how good I am. I just consider it as a really lucky event, and thankful that it happened. I am not hating myself today, why I only had that sized position. I know that when I made my plan, I traded it and I’m basing all my trades from that plan. I don’t care whether I should have earned twice or thrice, had I taken a larger position.
So these lines from the article have been really helpful for me. Thank you Ruth Roosevelt, excellent psychological coach for profitable trading. I think it has been more on the psychological aspect of the game, that has made me trade better, or at least at peace with myself whenever I have to cut losses or stick to a position size. It was never reading about financial textbooks or getting a higher degree. I don’t know about other traders, but psychological coaching really improves results.
Very Relatable Lines:
1.) You hear about it. You read about it. Don’t be misled. Traders tell stories. They write stories. They tell how great they are. Big trades. Big numbers. Big egos. Hubris. And sooner or later, big downfalls. It goes with the territory.
2.) “Authentic freedom cannot be experienced until one learns to tame the ego and move out of self-absorption.” – Wayne Dyer
3.) “I’ve said it before, and I’m going to say it again, because it cannot be overemphasized: the most important change in my trading career occurred when I learned to DIVORCE MY EGO FROM THE TRADE. ” – Marty Schwartz aka PitBull
4.) If your self esteem rises and falls with your trading results, you and your trading are in trouble. Self concept has to be strong and durable and not at the mercy of the current, last, or next trade.
Some typical symptoms of ego-tizing trading would be the following:
- Not putting in stops. The ego doesn’t want to be proven wrong.
- Hesitating before putting on a trade. The ego wants reassurance before it begins.
- Overtrading. The ego wants to prove itself big time.
- Getting stuck in a trade. The ego has intertwined itself with a trade and is holding on for dear life. It cannot cut out. The ego doesn’t want to be wrong.
- Adding to a losing trade. The ego digs its hole deeper in a massive effort to crawl out.
- Grabbing a profit too soon. The ego wants a pat on the back.