The proper trading mindset and the subconcious mind
I am convinced that in order to be a succesful and professional trader, having the proper mindset is around the 80% reason of that success.
There can be many, but many winner systems around, but if you do not have the proper mindset, those systems will not be good at all.
The proper mindset has a lot to do with the subconscious mind. This super powerful part of our being, which need to be programmed and believe we are successful traders.
For instance, talking about the trading language I do not like to say losing trades, but I rather to call them gifts to the markets. I do no say stop loss, but boundary protection area. And I do not think about winner vs losers percentages or risk to rewards ratios, since all those words make your mind to focus on risk or losing.
I have found there are many ways to re-program your subconcious mind such as: writing only about good things and the way you would like them to be in the present tense, affirmations, subliminal audios and videos, hynosis, autosuggestion, among others.
However, I have also found that re-programing your suboncious mind is not an easy task and it can take some time especailly if you have an habitual pattern of thought that does not help you and that it has been fixed in your mind for all your life.
What are the experiences you guys have with this, and what are the best ways you have found to reprogram your subconcious mind and obtain a succesful trader mindset?
The following 3 users say Thank You to jgomez74 for this post:
I pretty much agree to the extent that you should have a positive mental attitude (and the significance of it )....I don't know about reprogramming and such. I suppose if you have negative/I'm a loser mentality you should look for ways to be more optimistic.
I would imagine for trading anyway negativity and related feelings/emotions most likely stem from losses.
In such cases you have to somehow devleop confidence either by succsesfully paper trading or trading small initially to build confidence and from that comes a positive attitude/outlook.
Overconfidence isn't as much as a problem the way I see it because the market will for sure straighten you out if you think you are invincible but at least at that point you likely have a good enough attitude to realize that you just got a little cocky.
On the topic of calling losses "gifts" and so on I prefer to not BS myself and I call them what they are. I suppose there is nothing wrong with it but for me it seems like your not dealing with reality engaging in that kind of stuff.
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Interesting post as I'm in the middle of putting together a post along these lines myself. The language we use does indeed influence the way we react and perceive situations and it's interesting that you should look at re-wording the language used. As an NLP practitioner (the 'L' standing for language) I've witnessed first hand how changing language can bring about positive changes. I hadn't until now really thought about the term 'stop loss' with negative connotations but yes, using positive language will help re-program (the 'P' in NLP) our unconscious to a more positive spin. But it does need regular use until it becomes hardwired, that is when you start using the new, positive language unconsciously.
One major tenet of NLP is "there's no such thing as failure, only feedback" meaning we can learn just as much if not more from our "non-wins" as our wins.
I'm looking at goal setting, ecology checks (how it affects you and those around you), emotional strategies, changing limiting beliefs and lots more
Watch this space!
(The word "donation" just popped in to my conscious mind - I think I'll use that from now on!)
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Thank for your responses. NLP is a good way to re-program your subconscious. Are you using any NLP method that you can share?
In addition to some of the methods I wrote in my first post, there are some others like sun gazing, watching the light of a candle, EFT, Ho'oponopono, the Silva Mind Method etc. Have you guys used any method? However, I have found that the most important part is your daily thinking.
I mean, you can use all of these methods, but if you do not engage yourself to change your daily thinking, the thoughts you think minute per minute, all those methods will not work. Those methods help you to access your subconcious, but in order for the new thoughts and beleifs be fixed in your mind, you must think those new thoughts and beleifs over and over again so that they become habitual in your thinking.
All this is a fundament to be succesful in the trading business.
I think you have it backwards. Acknowledging, and limiting, risk are among the most important aspects of trading. You shouldn't avoid or relabel them; you should work hard on mastering them.
Most people spend time working on psychology due to a lack of a valid approach. Granted, if one is a discretionary trader, psychology does play a part. Irrational fears and lack of discipline are just a couple of examples of things that may be holding discretionary traders back. It's amazing how fast does problems evaporate once one finds a profitable approach, though.
Unless one is scalping, of course; the ability to read pure price does require a clear mind. It's more comparable to sports or music, really.
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You have to be aware of risks, and losses are manifested risks. Also a lost trade does by no means have to be a failure. It is very well possible that you did everything right, and if you are a good trader it is not possible but likely.
On the other hand a failure doesn't mean a loser, it could still be a winning trade. But just because it is a winner doesn't make it a sound trade.
But even worse than relabeling losing trades would be to relabel mistakes. We learn much better and quicker by mistakes than by success. And clever people are able to learn from the mistakes of others....
Hic Rhodos, hic salta.
Last edited by vvhg; January 17th, 2012 at 11:13 AM.
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There's a book out there, The Sedona Method, but if you look online you can find various shorter version pdfs.
Also, there's some Sedona Method stuff on youtube that will give you some idea.
Essentially, Sedona is a psychological method for releasing all unwanted emotional patterns. Helps you with self sabotage, discipline, trading 'mood'...etc. Yes, it did help me. A very useful tool. Teaches you 5 effective ways to handle your emotions as they pop up.
"...the degree to which you think you know, assume you know, or in any way need to know what is going to happen next, is equal to the degree to which you will fail as a trader." - Mark Douglas