There are two flavors of this misconception:
- Pessimistic: I tried it once, and it didn’t work, so it never works
- Optimistic: I saw it work once, so it always works
Let’s look at them in a little more detail…
Mar
29
Mar
29
Many tales of woe on beginning trader blogs start like this:
The markets were tanking, so I looked for short plays, and …
Feb
14
This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com
(The idea for this article came from this half hour video episode on workopolis TV, a show which discusses different aspects of your career. I have adapted it for the vocation of Trading for a Living.)
Impatience is about anxiety or frustration at the obstacles to getting what you want or the obstacles to achieving your goals and objectives. Psychologists have suggested that people who are impatient are likely to have higher standards and are more results oriented. This is not a bad thing at all. However, if you act on your impatience without managing it, you may harm a relationship or make rash decisions. If you are acting out of impatience, that means you are not acting with intention.
In theory, one way to deal with impatience is to be more realistic and to better manage your expectations. Managing your own expectations during trading can help stave off feelings of impatience. Traders like me tend to underestimate the time frame required to let a trade work out, or underestimate the length of time required to wait for the right setup to come to me. It’s not that I have such a short memory and forget these rather simple truths, but in the heat of the battle, probably the last thing on my mind when I have 4 or 5 trades baking at the same time, is, “oh, I’ve underestimated the time frame required for this trade, so I had better give it a little bit more time for the trade to work itself out.” So for me, it is good to be continually reminded of these simple truths.
Another way to deal with impatience is to take a broader perspective of things. Yesterday (Feb 13/07), I was pretty steamed at the getting stopped out not once but twice (on two different stocks), only to see the stock reverse back up. But in the bigger scheme of things, it was much ado about nothing. There’s going to be a million more stocks that will stop me out before reversing back up. I had better get used to it, otherwise, I would be wasting quite an excessive amount of energy getting mad over essentially a meaningless event.
What I have learned, is that being patient is not always all about waiting. There are other things that can be done to lessen the focus on waiting. While you wait, you can practice the other 7 habits, or start looking for the next great trading idea. Again, this is a simple truth, but again, it never hurts to be continually reminded of the benefits of taking the patience pill.
This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com
