| Emotional Threshold |
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| Sunday, 21 February 2010 22:41 |
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Are you upset, angry, frustrated, anxious or worried? This is not the state of mind that creates good results in trading. If you repress emotions that are natural to the way you feel, it is even worse because they never go away and accumulate.
What happens to your neurological system when you are depressed or in any negative state is that you shut down your ability to see and take opportunity at the appropriate time. A trader named Daryl recently called to tell me that he is constantly missing the mark of making the right choices and he does not understand why. “It’s like I’m jinxed,” he said. The fact is that he is right, but he is the one who is behind the jinx. What I came to find out later in the conversation was that his wife lost her position as a computer engineer, and she was the main breadwinner of the family. Daryl had quit his job six months earlier to become a professional trader. He said that he consistently earned money from his strategy but was only working with twenty thousand dollars to start. Daryl said that he was at thirty five thousand dollars before the jinx started. This proved to me that he had something viable in his strategy and that his current circumstances created his present situation in trading results. With his wife losing her job, they were now having to take money from their savings and Daryl was rightfully worried. Daryl’s situation and other situations that create negative feelings are being played out across the country more now than in recent times. The fact is that when a trader goes through negative feelings, performance suffers. In hindsight we can say that Daryl’s choice to become a professional trader with only twenty thousand banking on his wife keeping her job was not a good choice. This belief was backed up for me when I came to find out that Daryl’s wife felt stressed because of her husband not bringing in an income and it showed in her performance at work. When there were cuts made in the company, she was one of the first to go. Everyone has his or her breakdown point While it is not always easy to see the storm that is coming that will create havoc in your life, the only thing you can do is prepare for it by making good choices. It is important to know the negative emotional threshold for yourself and the significant people in your life. The difficult part in knowing this is that people are not necessarily honest with themselves and/or do not know how to gauge this threshold. The past is a good teacher. Examining events in the past where negative emotions led to a negative outcome and how you came out of it are good lessons to draw on for dealing with future issues. In Daryl’s case his wife told him that she was uncomfortable about his quitting his job because her company was not doing well. She came from a family where the man was the one who supported the family with a regular paycheck. On Daryl’s side of warning signs he felt confident in his ability to be a profitable trader, but he knew his strategy would not produce the kind of income that could support the family for at least two years. In Daryl’s case it was clear that the risk he was taking was too high. How to prepare for possible upset Know the emotional thresholds of your family Prepare a personal strategy to overcome these emotions Consider if the calculated risk you are taking would best be delayed, but make Georgia Anderson` Financial News Network, trader, trader education, online forex, daytrader,forex currency, forex software, investors, forex trading, forex. |
Disclaimer
There is substantial risk of loss in trading commodity futures, options and off-exchange foreign currency products. Each investor must consider whether this is a suitable investment.
Trades or trade recommendations made on this site have not been made by Georgia Anderson.
Trades or trade recommendations made on this site have not been made by Georgia Anderson.
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