Max had had enough, and in the words of the movie “Network” he was “mad as hell and he wasn’t going to take it anymore!” Max had taken several Futures classes from some very good instructors. He had a trade plan, and he had been told that it was fairly comprehensive. He knew the importance of having a set of rules, heck, he had a whole list; good rules too, he thought. He had learned the importance of money management and risk management; in fact, he had in his plan that he would only risk 2% of his portfolio at any particular time and that he would only take trades that were minimum 3:1 reward to risk ratio. And, his plan listed his appropriate position size for entering trades. Max had gotten fed up yesterday and in an almost fit of rage he “promised” himself that he wouldn’t “violate” his rules again. That was yesterday, exactly twenty-three hours ago. Here he was just having lost the most money he had ever experienced, 20% of his portfolio, in one trade and in one day all because half way through the trade he increased his size, took out his stop and doubled down in an ES Emini trade that wasn’t even one of his setups. It was a revenge trade as he tried to “get his money back” from a string of losers that morning. He no longer felt the rush of anger blood to his head with the rage that ate at him like a leech yesterday…today, he felt depressed, dejected, impotent, incompetent and quite stupid. “What is the matter with me?” He all but wailed to himself. “Why can’t I do what I know is right?” This wasn’t the first time that Max had promised himself that he would keep his commitments. Actually, it had happened more times than he cared to admit. But, Max was laboring under the “self-discipline myth.” He believed that he had to “force” himself to follow his plan and rules. Little did he know that even though this self-discipline strategy can help some people some of the time, it is solar systems away from the most effective method to achieve, preserve and prolong discipline; that is, tying your efforts to your passion.
Max, and let’s face it, many of you who are reading this article approach self-discipline from the same angle. You put your nose to the grindstone, your shoulder to the wheel, you suck-it-up, you bite the bullet, and you take the bull-by-the-horns. In other words you force yourself to follow-through with what you have deemed important, but unfortunately you run into conflict with yourself when you don’t “feel” like doing it. When you are in conflict with yourself, it is much easier to proceed by default thinking and doing. Let’s view that for a moment. Much of trading is counter-intuitive, and it is very difficult; not because it is hard to figure out but because of… Continue Reading
