I’ve been a trading coach for 15 years and I’ve worked with just about every type of trader one can imagine. One thing they all seem to have in common, however, is a certain reluctance to reach out. As you probably know, when guys are lost we rarely ask for help unless and until we have tried everything we can think of three or four times. We naturally resist unsolicited advice, especially from those who know us the best. It’s a guy thing, I guess.
Interestingly, however, not everyone who comes to me is lost or in serious trouble. I recently worked with a fellow who trades only one stock and he does so quite profitably and he supports himself daytrading. Although he is generally quite disciplined, he did have days when he went off the rails and made trades he was not proud of. That’s why he called.
We explored how this was happening using an Inner Dialogue process and I was surprised at how much access he had to his inner world. We worked on differentiating and then integrating a particular sub-personality that would occasionally hijack his trading. The result is a trader who is now much more in control of himself.
Every now and then, however, I get a coaching client who has a habit of making just about every mistake in the book and at the same time not know what is wrong.
Client X, for example, would hyperfocus on price bars, cancel and move stops, trade too much size, add to losers, trade while under interpersonal and financial stress, trade with a history of painful experiences, punish himself with negative self talk, get irritated at his wife and pets, revenge trade after 2-3 losses, chase price, overtrade and on top of all this he had no ability to control risk or losses. Over the last 5 years he had burned through a 6-figure inheritance and was starting to have health issues.
You might think that this guy is hopeless, but one’s results from coaching depend largely on one’s coachability. If you are open to change, then change happens. Client X was coachable and he turned his trading around in 5 days. He still chases price, but he now has indicators that tell him when to get out. He trades much smaller size, trades much less frequently and he now trades more rationally, with hardly any drama, even though he is daytrading the fastest moving stocks in the market. He reaches his daily goal within 90 minutes and then is able to step away from the screen and go enjoy his day.
Again, I was surprised at how much this fellow was able to change in such a short period of time. I take little credit for it; he was simply ready to change and he has been one of the easiest client’s I’ve ever had.
And then there’s the fellow who writes me occasional emails about how he is losing money and lacks any risk controls besides bargaining with the market (that’s Stage 3 of the 5 Stages of Trader Failure). He clearly isn’t ready to make any changes and all I can do is let the inevitable process play out. He’s not feeling any pain, but I have enormous empathy for his wife, who I’m sure is mortified.
Gosh, I love my job.
