The Empowered Trader by Mark Fechner

Learning to Respond to the Market, not just React

Archive for the ‘Mindfulness’ Category

The Good Enough Trader Fired Up!*

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The Good Enough Trader explained what many traders experience, a sense of maintaining the status quo. Things are “good enough” when it comes to the trading results. Another way to look at it is a sense of breakeven, not too big either from a winner or loser point of view. This can result, for lack of a better description, in a malaise of mediocrity.

Please don’t mistake the description of “malaise of mediocrity” as a negative. It’s an imperfect way of describing what you might be feeling in your trading results. If you are generally happy with maintain status quo, then you don’t need to read any further. The malaise of mediocrity I’m speaking of is a sense discontentment regarding your trading results.

Generally, most traders that talk about a break-even result are not happy. They have envisioned some sort of result that will propel them into another type of reality, be that lifestyle, tax bracket or bank account. But somehow the dream of making a bunch of money hasn’t been realized. A way of remedying this situation is to create a passion about your trading.

Awareness & Acknowledgement

The awareness and acknowledgement are kind of in the same thought process. By acknowledging that you’re not happy with your results is also the awareness that your results are not what you expect them to be. So, unlike The Revenge Trade Calmed or The Defeated Trader Empowered, there isn’t the same need to step back and make the awareness that something is amiss that requires you to pause and acknowledge the feeling. The Good Enough Trader is more contemplative. Since this is a level that is very much “in your head”, it’s very easy to get stuck there and not able “think” your way out.

Action

So what is required is to utilize some of the Revenge Trader to spark a fire about your trading. The focus of that spark is directed toward the question, why are you trading? I addressed this in my posting The Difference Between the Will and the Way. Understanding what the purpose of your trading is will go a long way to inspiring you to make trades that feed a specific purpose. As an example, I trade not because of the money, but because what I’m able to do with my life. My priorities in my life are my family and my community. Trading has allowed me to pursue a type of lifestyle that allows me to work from home and be very present to my family. I use the Revenge Trader to fight for that lifestyle and create trades that support those goals. If the trading didn’t serve that purpose, I would most likely find something else that did. Another way of looking at this is that I’m trading for a living not living for trading. The strategies, my style of trading, all support the priorities in my life.

A suggestion would be to examine your reasons for trading. Create some clarity about your reasons for coming back to the market day after day. Making money can be achieved by many ventures. What is it about trading that is different from say opening up a coffee shop or starting a consulting business? How does trading support your lifestyle?

If you would like to have some assistance regarding your trading goals, sign up for a complementary exploratory coaching call. Click this link to find an available time to meet.

The next condition we’ll examine is The Altruistic Trader.

*The educational material contained is gratefully adapted from the training received at the Institute for Professional Excellence in Coaching (iPEC), its founder Bruce D Schneider, and his bestselling book Energy Leadership.

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Written by etradingcoach

February 14, 2014 at 3:00 am

The Good Enough Trader*

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In our discussion so far of the seven different filters, we touched on the Defeated Trader Syndrome and the Revenge Trader. Both of these filters have been very catabolic, or have negative energy, associated with them. Remember, the 7 different levels are neither positive nor negative but they have a negative or positive quality to them. With our next level, the Good Enough Trader, we are starting to enter the more anabolic or positive quality.

The Good Enough Trader

The Good Enough Trader has the ability to rationalize everything. Think of this level like walking around with a pebble in your shoe. Instead of taking the pebble out, you change the way you walk so that you don’t notice it. Ignoring the pebble isn’t the same as dealing with it. As a trader, because of the nature of trading, we often rationalize our trading to “that’s the way the market works.” It becomes “good enough” because the market is unpredictable and $#!+ is bound to happen. But just because the market is capricious, doesn’t mean we have to be with our trading decisions. Here are some thoughts about the nature of this filter.

Characteristics

Some of the thoughts of this level:

  • Being very tolerant.
  • Willing to compromise.
  • Settling or “good enough” on what results you’re getting.

Some actions that result in this level:

  • Worry – making sure that things work out.
  • Judgment – is this really the best situation to be in?
  • Analytical – trying to think your way out of a situation.

The Good Enough Trader is very contemplative, spending a lot of time in their heads.  Because of this contemplative nature and the fact that this level is about rationalization, it’s very easy to stay in that loop of always saying that whatever your results, it’s good enough. This is where a lot of traders find themselves maintaining a breakeven type of trading result. They don’t have big losers, like when they were learning to trade, but the winners aren’t really that big either. There’s a certain amount of maintaining the status quo. Nothing too big either from a winner or loser point of view.

In the next posting, the Good Enough Trader Fired Up, we’ll talk about some of the things you can do to inject some passion in your trading and boost your trading profits. If you would like an opportunity to talk about igniting some fire in your trading, sign up for a complementary exploration coaching call. Click this link to find an available time to meet. Please include a brief description of your particular challenge in trading.

*The educational material contained is gratefully adapted from the training received at the Institute for Professional Excellence in Coaching (iPEC), its founder Bruce D Schneider, and his bestselling book Energy Leadership.

Written by etradingcoach

January 28, 2014 at 7:45 am

The Difference Between the Will and the Way

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We’ve all heard the phrase, “Where there’s a will, there’s a way.” It’s intended to be an inspirational quote to motivate people to tackle the hurdle that confronts them or overcome an obstacle. It sounds good but I’ve never completely understood how this is supposed to motivate me. Does it mean that if I don’t have a way, I’m without a will? Is my will so weak that I’m incapable of creating ANYTHING to find a way?

These types of phrases are what traders take with them when they sit in front of their charts deciding what they should be doing in the market. I’ve had more than one trader parrot back this phrase to me when they are explaining their trading results. It’s usually a hollow attempt to steel themselves to the incredible task of becoming “successful” traders.

The challenge, as I see it, is that we’re putting the preverbal willful horse behind the cart. We make the mistake of focusing all on the way of doing things rather than the will to do them. To put it another way, we focus all of our attention on how to become successful traders but spend very little time on why we want to become one.

Admittedly, this is really easy to do. A quick Google search on the words, “trading methods” will yield 35,700,000 responses where as “trading psychology” will only net you about 9,570,000. It’s much easier to sell the method, or the “way” of trading in contrast to the “why” or the will of trading.

Solving the puzzle about the “why” of trading is important. It does 2 things for traders. First, it’s what gives traders the will to get up the next day and find new trading opportunities. Many traders begin trading in the hopes of making money easier, faster, less stressfully. When this doesn’t happen, they inevitably give up thinking that making money is just too hard.

Second, it gives focus to traders on the way they are going to trade and narrows down those 35+ million hits on Google to a manageable number of possibilities. With so many different ways of trading, the only way to navigate the method-landscape is by taking stock of your own values and desires. This is, at least, a starting point for discovering how a trader is going to become the next William Buffett.

And there is some scientific evidence for this approach. As Dr. Elliot Berkman, Assistant Professor of Psychology at the University of Oregon writes in Psychology Today, the will and the way are two parts of a goal hierarchy in our brains. The Will is the higher function of this hierarchy and the Way are the particulars of getting the goal accomplished. If we apply this to trading, knowing what we are trading for, the bigger purpose, gives us a clearer picture of how we’re going to get there. That will, minimally, give us a better chance of achieving our trading goals.

Written by etradingcoach

December 12, 2013 at 8:00 am

Revenge Trader Syndrome Calmed*

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The characteristics of the Revenge Trader Syndrome painted a picture that many traders have experienced. That sense of being alone and that the market is out to get them is a common sensation amongst traders. Since most retail traders are physically isolated from other traders, the burden of making the “right” decision is exaggerated by feelings of aloneness, defiance or revenge.

The need to create awareness of these feelings, as we did in the Defeated Trader Syndrome Empowered, is even more important for the Revenge Trader Syndrome. The reason is that unlike the Defeated Trader Syndrome, which can mire a trader is inactivity and indecisiveness, the Revenge Trader is more likely to act on their feelings. The core feeling here is anger. Anger can motivate people to take action, in some cases, any action, to change a situation. Taking action is good. The challenge becomes to take action that is responding to the market rather than reacting to it.

We are looking to learn to be powerful verses forceful. We want to use this filter to create an inner strength so that your decisions and subsequent actions are conscious rather than unconscious.

Awareness

As we discussed before, the first step is to be aware. Being angry, unfortunately, can be somewhat blinding. Have you ever been in an argument with someone and raised your voice without being aware of it? That’s the challenge to us as traders.

So awareness starts with the word “STOP.” Stop what you’re doing; stop chasing the market; stop taking action. This is one of the hardest things to do, especially if you have a little gremlin on your shoulder telling you, “Get back in! Don’t stop now, you’re going to lose!”

So this is how you take back the power of The Revenge Trader. Instead of letting that gremlin tell you what you should be doing, use that voice as your own personal indicator. Let the gremlin be the awareness that you need to begin making a change in your trading decisions.

Acknowledgement

Then, acknowledge the gremlin. Acknowledge the fact that, at that particular moment, you’re not trading at your best. You may be reacting to the trading situation instead of responding. Acknowledge that your decisions might be based in fear and not in the best interest of your trading account and certainly not in alignment with your larger trading goals.

Action

The simplest action – STOP! Stop trading, stop risking money in the market and stop trying to prove you’re right!

These actions sound good on the surface, but they can be incredibly difficult to implement. After all, if it were as easy as I’ve just outlined, there would be no need for these types of conversations. Everyone’s version of the Revenge Trader is unique and therefore calming the trader is also unique. Your job is to understand how the Revenge Trader might be showing up for you and what the best course of action is to calm it.

If you would like to talk about your particular brand of the Revenge Trader, sign up for a complementary exploratory coaching call.Click this link to find an available time to meet. Be sure to give a brief description of how the Revenge Trader shows up in your trading results.

The next condition we’ll examine is The Good Enough Trader.

*The educational material contained is gratefully adapted from the training received at the Institute for Professional Excellence in Coaching (iPEC), its founder Bruce D Schneider, and his bestselling book Energy Leadership.

Written by etradingcoach

December 5, 2013 at 8:00 am

Revenge Trader Syndrome*

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Continuing on in this educational series, we examine the second filter called the Revenge Trader Syndrome*.

The Revenge Trader Syndrome

The Revenge Trader Syndrome is the 2nd of the seven levels and is slightly more positive, or anabolic, than the Defeated Trader Syndrome. If you remember from the Defeated Trader Syndrome’s characteristics, we were in helpless state of mind. Not really able to make any decision and feeling pretty bad about the decisions we were making, unable to move forward. The name, Revenge Trader, being the next level up, aptly describes the general nature of this filter. That means, getting mad is better, more positive reaction than doing nothing. Let’s look at this level’s characteristics.

Characteristics

Some of the feeling and thoughts of this level:

  • Being alone, me against the market.
  • Betrayal, a sense of being wronged.
  • Anger, at mostly others of the market but can be directed at one’s self.

To help identify some of this for yourself, you might hear yourself saying some to these things:

  • “Trading is hard. It’s one fight after another.”
  • “This is a dog eat dog world.”
  • “There is only right and wrong, no grey area.”

Consequently, this self talk can lead to some of these behaviors:

  • Defiance – trading to get back at the market.
  • Revenge – this is pretty self explanatory
  • Proving you were right about your analysis

I’m going to venture to say that this characteristic is familiar to many traders. That’s understandable because there is often a passion to make trading work in one’s life. That passion can be a great motivator but it also can cloud our judgment regarding our expectations. The desire to have that trade get to your profit target can be overwhelming if you’re not aware of the underlining filter being used. The desire of having a trade hit its target can be translated into an affirmation to you that you are “right”. The desire to be “right”, therefore, can be a powerful enticement to stay in the market when common sense says otherwise.

This posting is just an introduction to the characteristics of the Revenge Trader Syndrome. Your Revenge Trader will be uniquely yours and be a reflection of how you look at the world. If you would like to talk about your particular brand of the Revenge Trader, sign up for a complementary exploration coaching call. Click this link to find an available time to meet. Be sure to give a brief description of how Defeated Trader shows up in your trading results.

In the next posting, we will examine how we can calm the Revenge Trader and take control of its capabilities.

*The educational material contained is gratefully adapted from the training received at the Institute for Professional Excellence in Coaching (iPEC), its founder Bruce D Schneider, and his bestselling book Energy Leadership.

Written by etradingcoach

November 21, 2013 at 8:00 am

The Defeated Trader Syndrome Empowered.*

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In the previous posting, we discussed how these filters have a positive and negative quality to them. This bears repeating because when we’re in the throes of a really bad trading session, it’s very easy to place all sorts of judgments on ourselves, our abilities, the market, and in some extreme cases, life in general. The phrases, “I’ll never get this,” or “I’ll never make a living at this” have negative connotations and can lead traders to a variety of impulsive actions. Have you ever figuratively thrown up your hands and abandoned everything you’ve been using because “it’s just not working?”

Congratulations! You’ve just identified your version of the Defeated Trader Syndrome. And if you have been trading any length of time, this is something you have experienced. Being immersed in this filter can be all consuming and feel like there’s no way out. This is perfectly normal.

Awareness

The key to overcoming this syndrome is to, first be aware. To do that, you will need to “feel” your feelings. Yes, I said the word “feel.” I know this is a four letter word in the trading world, but it’s the only way to move forward. It’s not the feeling of despair, frustration, or inadequacy that you need to avoid, but rather embrace to get out of this state of mind.

Acknowledgement

Once you become aware of what you’re feeling, the next step is to acknowledge it. You’re acknowledgement could be as benign as a few choice words to something more physical. (I knew a trader that would throw his wireless mouse across the room when he got very frustrated. He kept Logitech in business because of it.) However you choose to acknowledge the feeling, the important part is to take the awareness to the next step, which is to take action.

Action

Taking action is the way you alter your state of mind and change how you’re trading at that moment. The simplest way to take action is to step away from the computer screen. Physically get up and walk away. That simple act of walking away has amazing recuperative properties. It allows you to change your perspective and your state of mind. It gives you a fighting chance to change your decision process and make a new set of decisions.

There is obviously much more on the subject, but this is a beginning. Remember, these are generalities. How this will show up for you is very unique and may not always be the very obvious. If you would like to talk about your particular brand of the Defeated Trader Syndrome, sign up for a complementary exploration coaching call. Click this link to find an available time to meet. Be sure to give a brief description of how Defeated Trader shows up in your trading results.

In the next posting, we’ll talk about the next filter that many traders fall victim to, The Revenge Trader Syndrome.

As always, Happy Trading to One and All

Mark
eTradingCoach

*The educational material contained is gratefully adapted from the training received at the Institute for Professional Excellence in Coaching (iPEC), its founder Bruce D Schneider, and his bestselling book Energy Leadership.

Written by etradingcoach

November 14, 2013 at 8:00 am

The Defeated Trader Syndrome*

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As we stated in a previous posting, we’re going to get started in learning about these different filters by examining the first one that I call the Defeated Trader Syndrome*. As I stated before, these filters are neither good nor bad but they do have positive and negative qualities, similar to the positive and negative quality of electricity. They can be ranked from 1 as most catabolic, negative, to 7 as most anabolic, positive. We use all 7 filters on a daily basis, usually unconsciously, and they help us make decisions on a variety of subjects and situations.

The Defeated Trader Syndrome

The Defeated Trader Syndrome is the most catabolic of the energy levels. Being the 1st of the seven levels, it often is where many people default to when stress occurs. Some of the core characteristics are stated below.

Characteristics

Let’s start by identifying some feelings, and thoughts of this level.

  • Feeling of guilt, regret or remorse.
  • Incapable of succeeding as a trader.
  • A sense of avoidance to trade or lack of motivation to trade.

To help you identify this level to yourself, becoming aware of the self-talk we use when we are in this level is helpful. Here are some things you might say when in this level:

  • “Why is the market doing this to me?”
  • “Every trade is a loser.”
  • “Why did I take that trader? I know better.”
  • “I should never have taken that trade.”

The action or result of this level might be:

  • Lethargy
  • Avoidance
  • Feeling bad or a sense of inaction.

These are generalizations of what you might be experiencing, but in general, a lack of motivation and energy is not uncommon in this filter.

If you’ve been trading for any length of time, these feeling or actions are not unfamiliar to you. It is normal to experience these feelings. The trouble occurs when these dictate how you act on a regular basis or how long you stay in this particular level. If you are experiencing these feelings on a regular basis or several times during a trading session, you are probably not working are your best, optimal self. Creating the awareness is the first step to moving forward in your trading and getting more of the results you desire.

In the next posting, we’ll talk about some strategies for moving out of the Defeated Trader’s Syndrome to empowering yourself to making better decisions.

*The educational material contained is gratefully adapted from the training received at the Institute for Professional Excellence in Coaching (iPEC), its founder Bruce D Schneider, and his bestselling book Energy Leadership.

Written by etradingcoach

November 5, 2013 at 7:57 pm

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