Neophytes see market speculation as an exciting way to make money and break from the business world. The discipline routinely attracts over-40 white males with professional backgrounds in other occupations. They believe that their financial success in one career will quickly translate into trading profits. These well-capitalized participants apply the same ambition that works so well in the businessman's odd pecking order. But testosterone can't force money from the markets and quiet introspection builds better strategies than bravado. Those that survive their early mistakes all tell a common tale: this fascinating pursuit is the hardest challenge they've ever faced.
The markets provide the perfect mechanism to confirm just how screwed up your life really is. Money represents power in modern culture. Traders seek to master this force and become market wizards. But the subconscious mind often has its own agenda. Many participants don't really want to succeed at an advanced level. So they project their hidden inadequacies into their trading performance, all the while thinking that "yes I'm a bad person and don't deserve the good things that trading will bring to me".
The business world forces employees to perform a laundry list of duties for an extended period of time before rewarding them with a paycheck. This rat-in-the-maze mentality deeply affects our view of money. It trains us to believe that our financial fates are in the hands of a powerful third party who controls wealth. But traders must recognize their own power in the creation of capital before they can succeed. This deceptively simple skill may take a lifetime of effort to undo years of bad programming.
The markets require a level of discipline that most of us fail to achieve in the rest of our lives. So why should it be any different with trading? Stock positions offer endless opportunities to break rules and ignore danger. Wise participants recognize non-market limitations and deal with those first, before proceeding on the path to profit. Weight loss, smoking abstention and regular exercise all improve the odds for trading longevity. Add stress reduction and you'll find that your trading performance improves faster than taking an expensive weekend stock course.
Trading frustrates those who make great achievements in other walks of life. Few other disciplines require constant loss to reach their goals. The pain of losing money stands beside profit throughout the road to success. Accept this unpleasant fact and prepare to deal with the emotional roller coaster. Both winning streaks and drawdowns test rational behavior and trading strategies. Stay focused and stick to the plan. Participants that lose concentration face a gambler's paradise. And just like the real thing, they eventually leave the bright lights with very empty pockets.
Commit many hours to market study or avoid trading entirely. Develop a predatory instinct, avoid greed and view this occupation as a lifelong quest. Work hard to complete every analysis in detail and don't cut corners. Part-timers can succeed but must specialize on a few strategies and skip broader study. Match execution with effort or pay the price. Highly-trained market professionals stand ready to empty careless wallets, and only adequate preparation will uncover the secrets that produce consistent profits.
