I've spoken to hundreds of aspiring traders in my career as a tennis trader. These are the top reasons that most people tend to think cause traders to bomb-out:
1. Poor strategy
2. Market is too tough/against them/rigged
3. Don't have the right trading skills/natural talent/aptitude
I've come to realise that these reasons are merely symptoms of the underlying causes of failure. The reality of why most people fail at trading is this:
1. Negative mindset
2. Motivation/desire not strong enough
3. Don't work on themselves
What do all these things have in common? They are all MENTAL issues. The first 3 reasons I listed are all specific to trading itself. The second 3 not only apply to trading but ANYTHING in life. So sort out those 3 mental issues and the 3 that are specific to trading will automatically resolve themselves.
Let's look at number 1: negative mindset. This is a mental issue which has its roots in low self-esteem. If you deep down don't think you will succeed at anything, you are guaranteed to fail. You can have a bank as big as Warren Buffet and every one of his strategies and you will still end up a loser because you already view YOURSELF as a loser. In my experience, although it may seem on the surface that most people are the opposite and get into trading believing that they are going to become a millionaire in 6 months, I see far more people who aim much lower than this. It's not because they are being "realistic" or "humble", it's because they don't think they are going to succeed. My advice is always to aim high but set a goal that is believable. If you aim low, you'll never get more than low and you probably won't even get that because there's a reason you aim low - you don't have the confidence or belief in yourself to be a winner.
I've never met anyone successful in any field who isn't positive. It's that simple. People who are naturally more negative in their general outlook on life are that way for a reason. Life has knocked them around a bit. We aren't born negative. It's something drilled into us either by bad parents or by bad experiences. I should know, I used to be negative. At the time, I would've said I was just very sarcastic or just being realistic. But as I got older and was able to examine myself objectively (and with a good talking to from a friend!) I realised that I was actually cynical, depressed, morose, pessimistic and downright negative! And guess what? I was also highly unsuccessful. What I didn't realise at the time was that I was highly unsuccessful largely BECAUSE I was negative. Once I worked this out, a light-switch flicked on and everything started to change in my life. Almost instantly.
Many traders with a negative mindset will also try to learn trading entirely through trial and error and inevitably crash n burn. It's because they refuse to get help from others. Buying a book or a guide is often the last thing they do. They are more likely to scream "SCAMMER!" than to conceive of the idea that someone who has achieved what they are trying to might actually want to charge something in return for the hard graft they put in learning the ropes the hard way, and sharing that knowledge so that others don't have to. You've got no chance of making money in the trading game if you are negative because only a positive person has the willpower to keep going once the inevitable losses, bust banks and endless grind start to wear you down. Pessimists give up easily: optimists keep going for longer.
Onto number 2. I wrote in my previous post about having desire or more specifically a burning desire that will motivate you to get off your fat arse and start taking action. OK, you're still sitting on that fat arse when you trade but mentally, you are going to have to work those brain cells and fire up those neurons! Because in my honest opinion, most people fail at trading purely because they don't want it enough. Not enough to cancel that night out down the pub watching the match with the lads, to instead stay indoors and trade it alone. Not enough to cancel that date with that girl you don't even really fancy that much but think there might be a chance of getting some tonight, rather than spend quality time watching round 1, 250 level tennis, in front of 10 spectators. Not enough to bother firing up the laptop to stare at a bunch of flashing numbers looking for patterns for three hours instead of firing up the laptop to binge watch another pointless Netflix show or jerking off to MILFs whilst shovelling Cheetos down your gullet because you're "too tired" after a hard day's graft. Not enough to sit and write down goals and plans and create strategies and tweak them and analyse graphs and read books (heaven forbid, reading!!) rather than just turn up at match time after drinking six pints and hope it all just "happens". Not enough to get out of that comfort zone of repetitive habits which control their life and mean that whilst they will probably always have a standard income, live in a standard house, with a standard 9-5 job, with a standard life, it will never amount to anything exciting or adventurous or abundant or wealthy or deep down, truly happy.
What I usually see in most traders is too much focus on strategy. It's all about finding a strategy. Gotta get a good strategy! If I can just get a strategy that makes money, I'll be rich! What they don't realise is, it's not the strategy that will make you profit, it's the IMPLEMENTATION of the strategy. And most traders cannot implement a strategy properly, not matter how easy or tried and tested it is. Why? This brings us to number 3: because they do not work on themselves. I know of traders who will work ridiculously long hours day in, day out, trying to find or improve strategies. You cannot fault them for desire and effort. But they do little to no work on the one thing that might just make one of those strategies work - THEMSELVES!!
What do I mean by this? I mean deeply analysing their own thoughts, behaviours, habits and mentality. Trading is a mental game. Yes, you need a good strategy, the numbers have to add up but it's not as tough as most people seem to think to find a workable strategy. Mine is very simple. Buy low, sell high, basically. It's not hard to craft something from that. What IS hard is getting through all the crap stuck in our subconscious mind: all the limiting beliefs, the fear, the gambling mentality, the ego, the bad habits, repeating patterns. Most people try to ignore it and hope it goes away - IT WON'T!! Nothing will change unless you actively work on it. You could be sitting on a goldmine of a strategy but you'll never be able to get to the gold because you don't do any work on the thing that operates the digger - your mind!
Strategies or ideas for creating strategies are easy to find once you have the desire and the belief. Having the right trading skills (patience, discipline, numeracy, value spotting etc) are things that can be learnt. It's not about this myth of "natural talent". Some have a better aptitude for trading than others but it's nothing that can't be learnt, especially if you're willing to put the hours in and let others teach you. Work on yourself and you can be as good as the very best traders. As for blaming the market or other traders, that's a result of a negative mindset. There's always ways of making money in any liquid market. If you haven't found it, it's just because you've not persevered long enough. And that's all about mindset.
1. Poor strategy
2. Market is too tough/against them/rigged
3. Don't have the right trading skills/natural talent/aptitude
I've come to realise that these reasons are merely symptoms of the underlying causes of failure. The reality of why most people fail at trading is this:
1. Negative mindset
2. Motivation/desire not strong enough
3. Don't work on themselves
What do all these things have in common? They are all MENTAL issues. The first 3 reasons I listed are all specific to trading itself. The second 3 not only apply to trading but ANYTHING in life. So sort out those 3 mental issues and the 3 that are specific to trading will automatically resolve themselves.
Let's look at number 1: negative mindset. This is a mental issue which has its roots in low self-esteem. If you deep down don't think you will succeed at anything, you are guaranteed to fail. You can have a bank as big as Warren Buffet and every one of his strategies and you will still end up a loser because you already view YOURSELF as a loser. In my experience, although it may seem on the surface that most people are the opposite and get into trading believing that they are going to become a millionaire in 6 months, I see far more people who aim much lower than this. It's not because they are being "realistic" or "humble", it's because they don't think they are going to succeed. My advice is always to aim high but set a goal that is believable. If you aim low, you'll never get more than low and you probably won't even get that because there's a reason you aim low - you don't have the confidence or belief in yourself to be a winner.
I've never met anyone successful in any field who isn't positive. It's that simple. People who are naturally more negative in their general outlook on life are that way for a reason. Life has knocked them around a bit. We aren't born negative. It's something drilled into us either by bad parents or by bad experiences. I should know, I used to be negative. At the time, I would've said I was just very sarcastic or just being realistic. But as I got older and was able to examine myself objectively (and with a good talking to from a friend!) I realised that I was actually cynical, depressed, morose, pessimistic and downright negative! And guess what? I was also highly unsuccessful. What I didn't realise at the time was that I was highly unsuccessful largely BECAUSE I was negative. Once I worked this out, a light-switch flicked on and everything started to change in my life. Almost instantly.
Many traders with a negative mindset will also try to learn trading entirely through trial and error and inevitably crash n burn. It's because they refuse to get help from others. Buying a book or a guide is often the last thing they do. They are more likely to scream "SCAMMER!" than to conceive of the idea that someone who has achieved what they are trying to might actually want to charge something in return for the hard graft they put in learning the ropes the hard way, and sharing that knowledge so that others don't have to. You've got no chance of making money in the trading game if you are negative because only a positive person has the willpower to keep going once the inevitable losses, bust banks and endless grind start to wear you down. Pessimists give up easily: optimists keep going for longer.
Onto number 2. I wrote in my previous post about having desire or more specifically a burning desire that will motivate you to get off your fat arse and start taking action. OK, you're still sitting on that fat arse when you trade but mentally, you are going to have to work those brain cells and fire up those neurons! Because in my honest opinion, most people fail at trading purely because they don't want it enough. Not enough to cancel that night out down the pub watching the match with the lads, to instead stay indoors and trade it alone. Not enough to cancel that date with that girl you don't even really fancy that much but think there might be a chance of getting some tonight, rather than spend quality time watching round 1, 250 level tennis, in front of 10 spectators. Not enough to bother firing up the laptop to stare at a bunch of flashing numbers looking for patterns for three hours instead of firing up the laptop to binge watch another pointless Netflix show or jerking off to MILFs whilst shovelling Cheetos down your gullet because you're "too tired" after a hard day's graft. Not enough to sit and write down goals and plans and create strategies and tweak them and analyse graphs and read books (heaven forbid, reading!!) rather than just turn up at match time after drinking six pints and hope it all just "happens". Not enough to get out of that comfort zone of repetitive habits which control their life and mean that whilst they will probably always have a standard income, live in a standard house, with a standard 9-5 job, with a standard life, it will never amount to anything exciting or adventurous or abundant or wealthy or deep down, truly happy.
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Too much time staring at this and not putting the hours in. STOP LOOKING!! |
What do I mean by this? I mean deeply analysing their own thoughts, behaviours, habits and mentality. Trading is a mental game. Yes, you need a good strategy, the numbers have to add up but it's not as tough as most people seem to think to find a workable strategy. Mine is very simple. Buy low, sell high, basically. It's not hard to craft something from that. What IS hard is getting through all the crap stuck in our subconscious mind: all the limiting beliefs, the fear, the gambling mentality, the ego, the bad habits, repeating patterns. Most people try to ignore it and hope it goes away - IT WON'T!! Nothing will change unless you actively work on it. You could be sitting on a goldmine of a strategy but you'll never be able to get to the gold because you don't do any work on the thing that operates the digger - your mind!
Strategies or ideas for creating strategies are easy to find once you have the desire and the belief. Having the right trading skills (patience, discipline, numeracy, value spotting etc) are things that can be learnt. It's not about this myth of "natural talent". Some have a better aptitude for trading than others but it's nothing that can't be learnt, especially if you're willing to put the hours in and let others teach you. Work on yourself and you can be as good as the very best traders. As for blaming the market or other traders, that's a result of a negative mindset. There's always ways of making money in any liquid market. If you haven't found it, it's just because you've not persevered long enough. And that's all about mindset.