In Trading in the Zone, Mark Douglas says, simply, “Great traders are not afraid.”
I agree, but this definition begs to be expanded. Over my 12 years as a trading coach, I’ve had the fortune to meet and work with some of the best traders in the business. If I had to pick one word, I’d describe them as amazingly resilient.
Resilience is simply the ability to snap back from adversity. We all feel the pang of loss, but resilient individuals feel it much less sharply and get over losses quickly. One famous trader who trades his 7-figure live account in a room full of eager adepts gives himself a forced time-out when he loses a trade… but that time-out only lasts 2 minutes!
For this fellow, an easy-going Southerner, that’s enough time to hit the reset button. But there is more than a 75% chance that this is not the case for you.
NATURE & NUTURE
We know that resilience is both a nature and nurture character trait. In other words, there is a genetic component (about 25% of the U.S. population has the gene configuration for resilience). However, one’s experiences in childhood also play an important role.
If a child had a particularly judgmental or punitive parent or teacher, they tend to introject (internalize) that critical voice. This simple survival tactic makes it more likely that the child can prevent new instances of punishment.
Unfortunately, when carried over into adulthood, negative self-talk can hamper performance in life and in trading. Studies show that negative self talk narrows options and makes one more impulsive. This is a serious problem if you are trying to trade for a living because trading requires the mindset of a quarterback…confident and adaptive.
To meet the challenge of active trading it is imperative that you foster a mindset that is ”bulletproof.” By that I mean, a resilient mindset that can quickly rebound from losses.
The best way to start is to make sure your self-talk is positive at all times. For additional information, read about Positive Neuroprogramming on my website.
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