Trading Mindsets & Inner Game
May 16th, 2019
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April 11th, 2019
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Today's we're going to take a look at some mindsets that are trading goals vs. trading intentions.
What are the Trading Goals?
I think goals are exciting when it comes to trading. A lot of people set goals, and they're pretty easy in the sense of because their numeral, right there are numbers that are attached to goals.
Let's say the leaders, the people who are pushing you to be better; hey you got to be able to do five times your gross revenues, i.e. five times well. What's your goal? Well, it's $1,000. Means you should be able to do that five times better now or how do you improve it while you're making, let's say you know three hundred dollars every single day from trading well how you grow that by five percent.
You know these goals when it comes to a number based thing that you're doing here that's trading. They're very very black-and-white because they're all numbers related and that's good on the one hand. Because you can actually see; hey did I hit the goal oh or not? So it's a binary situation, and the answer is going to be either a Yes or a No! Now, on the one hand, that's good because then you know, you're accountable did you hit it or just not. Did you make your thousand dollars this month or did you not? Or did you make your fifty dollars this month or did you not.
You're really accountable for it, but the downside of that is; goals will constantly shift right, i.e. goals are continually changing, and they should also be evolving. Which means, they grow and you grow as a trader. You're growing, your goals, those are increasing your account should be growing; maybe you're struggling, and you need to fine-tune your goals, and it's difficult in the sense of well if you're not hitting your targets then you kind of feel like a failure.
What are the Trading Intentions?
There's the other approach to this, which I like looking and thinking about and that is intentions. An intention, when we look at intentions it's much different than goals. It's kind of like your desire for what you want to accomplish internally. A goal a lot of times, when I look at it it's external right! What did you make, what did you hit, you know what's outside of your control, and that makes it very difficult.
Take for example a dancing competition. If you have intentions and we look at a dancing competition, your goal might be to go ahead and get first place in the race. Those could be gymnastics as well but any event where you know you're being judged, or you're trying to compete in the sense of that's not clean-cut right(It's somebody else's opinion).
When you're looking at a dancing competition who performed better, who had better lines, who was more on the beat, all of these are subject to someone's interpretation. It's very tough to say, hey did he get first place, that couple get first place or did that couple get second place yes you might have experts evaluating, but it's tough to really say that.
When you look at intentions, they're much different. If we look at goals like if you didn't get first place, you're a failure, if you didn't get second place you're a failure, they didn't get the third place you're a failure right. You're looking at all of these things just on the goal side like you didn't hit your medal or your mark or your placement because those were not in your control.
Looking at Intentions at a Deeper Level...!
What about, when we look at intentions? Let's say; you're dancing, well the critical question is; if you evaluate yourself, were you better at hitting the beat than you were before. Means that could be one way looking at things were you able to land that move that you were working so hard on that, maybe you couldn't do in practice as well were you able to do that quite well and if that might be a yes or no right.
You're looking at things that are more internal to you; were you able to do those things and accomplish those things and if you were then now, you've kind of won, and you're successful. Whereas over here, if you got second place and you didn't get first, you kind of already is a loser and that's sometimes can play on you psychologically, which is not always the best thing.
If you want to go even more internal right if we go even deeper well you could say hey well rather than looking at placement look at doing the things that will get you to placement what are the things that you need to do to get to first place;
Well to get to first place, I'm going to say:
- I need to practice five times a week
- Also, go and to build up my cardio for dancing
- I need to go running
- I need to go ahead and make sure I get a coach to evaluate me at least three times
- Two different coaches( so a second coach, i.e. they can determine my moves and what I'm doing right or wrong)
- I need to look good - seamstress or stylists or whatever to overlook things
All of the above things now are in my control... Very direct control. Now if I still don't get first if I did all of these things and I made my list, I was successful now you might say hey well you even didn't get first place, but at least you're making progress and this is the way I want you to start thinking about it.
You know these external goals are great and sometimes it pushes people to hit i.e. I gotta make $1000 a month, I'm trying to hit fifty dollars a month and try to hit a hundred dollars a month. Whatever your goal is and even if you're shooting bigger fifty thousand a month or 100,000 a month or whatever your case is that's all good and great. But if you don't hit it are you feeling like a failure is you struggling, and the question is; are you doing the right internal things to reach those goals and that's a little bit more important to me.
Because for me, when I looked at doing and trying to hit these goals, I always felt like a failure; the goals kept moving the goalposts kept running. You always try to hit more and bigger instead now, what I try to do is look at; hey am I putting on the whatever number of trades that I want per week or a month based on my current living situation. Am I managing them correctly? Am I adjusting them at the appropriate times? Am I waiting too long or am I doing them at the right time?
Internal Concept - The Right Path:
You start looking at the internal concept of it and if you're doing the internal things correctly, eventually maybe not in the first competition or not the first few trades or the first few months you're going to be successful. But perhaps a few months later and then eventually you keep getting more and more consistent more and better, and that starts to build up, and you start in a way winning more of those dance competitions.
That's what, I want you to think about when it comes to goals versus intentions and if it helps start focusing on what's your intention. Because now, you can control it and you can focus on it and rather than focusing on your goals and eventually the goals the external things that you set up will be the result of doing the right internal things.
October 11th, 2018
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My Thailand Trip
We got ourselves a guide, and in a way, a guide is a kind of like a mentor because they guide you through things.
We had some specific things that we wanted to see. We went around, and we said the things we'd love to see and they took us around.
There was one point when we were on our Thailand trip there was a weird little road that we wanted to get to. There's a little bit of a bank area, hotel, where there were some sightseeings about a six-hour drive in this weird and funky road.
We started over in Bangkok, and then we went, and we drove. I think about the two to three-hour mark of getting into this up a mountain trip, and we had a breakdown. The axle of the wheel broke because the roads are weird and funky. We hit a bump - the axle broke, the tire fell off. We sat there on the road for a couple of hours while the guide went back to go ahead get himself another vehicle and then come back to pick us up. That way we could get back to our area where we wanted to go and see.
We were stranded for a time, but it allowed us to be at peace to go ahead and keep moving forward in our journey even though there were some delays. The guide took care of this whole problem - an issue that we had.
What is a mentor?
A mentor is a guide. They help you navigate the waters of trading.
If you're looking for someone that's just a little bit more experienced in the area, that's really what a mentor is. That's really what a coach is. They have some vision, some perspective - they know the land, they know the area, they know the region.
We wouldn't have known how do we get a car to pick us up, what road to take. There's a bunch of different routes that you could have taken. With no street signs, it's tough to navigate a country in that way.
The same thing in the stock market world. It's difficult to navigate if you don't have the full perspective.
How do they help?
- They show you the path;
- They show you the risks;
- How to pronounce things right, if you're learning to read;
- How do you do things;
- What should you look at; and
- What are the things that you need to focus on
That's how mentors help you. They show you all of these different things.
Do I need one?
Do I need a mentor and guide? Do I need to spend money, spend the time, if I'm already getting these books and maybe courses? Do I need one?
The answer is NO.
You don't need one.
We didn't need a guide on our Thailand trip, but it would have been much more difficult. Say, for example, and someone would have to go back and figure out how to do the logistics of getting another vehicle. How to navigate the road and you get sidetracked. They help you stay away from getting into trouble.
There are some disadvantages to this because you then don't get to explore things or randomly bump into things and see things for the beauty that they are as you're taking a trip or as you're learning the stock market. But you get a direct path.
It allows you to compress your time to get what you need out of it, rather than drifting away into other areas.
That's the whole point of the guide.
Do you need one? No, you don't need one.
But does it help compress your time, your education that learning curve? Yes, absolutely because they allow you to stay focused on the things that you need and the things that you want to see. The things that you want to learn, rather than drifting into other areas. They simplify things a little bit more.
When it comes to the stock market, mentors help compress your time that you need to spend on learning the market.
September 27th, 2018
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Today, I'm going to share with you a little bit of insight from my upcoming book - Mindsets of a Master Trader.
We're going into socializing about stocks. The psychology behind socializing stocks. At least a little brief insight behind it and why it's pretty much useless most of the time.
I'm going to cover four main points here:
- My Facebook friends
- Quantity versus quality
- Look at introvert, ambivert, extrovert and
- most conversations
Let's start with Facebook friends
I'll share with you the average or most people's Facebook friends or the amount that they start collecting. Let's say 500 plus.
As you start building and accumulating people, that number might go to 700, and it just depends on who you consider a Facebook front.
The reality is that very few are going to be close relationships. Most of the Facebook friends are in the far distance, so they'll be over here, and you have a very limited or few people that you're actually hanging out with, talking with, making pleasant conversation with, discussing things in general about ideas, big picture, concepts to take you to the next level. Many of them are just connections that you've built over time, and it's just like collecting trading cards and playing cards.
Quantity versus Quality
When you look at the stock market, it's very similar to a lot of people. You have to decide how many stocks am I going to own versus the quality of stocks.
What is more essential for you to - to have 10,000 Facebook friends or to have five close relationships or even one close relationship such as a significant other a partner?
Again, you got to recognize what is more important - quantity versus quality.
Is it important to own as many stocks as possible?
You'll probably want to be somewhere in a balance between quantity and quality. Here would be maybe quality because you're having little and there would be a quantity where you're just trying to add up as much as possible.
Introvert or Extrovert?
For some people, they want to be a little more active - they're extroverts. Maybe they're looking more at the quantity or socializing more.
Introvert maybe a little bit more focused on the inside. That's when you don't want that many could be falling somewhere in between ambivert.
It's the same concept of Facebook friends, how do these things tie together? Could be more of your personality.
As we socialize and we look at socializing, many of the conversations that happen in news reports and just a lot of things that occur about the stock market are pretty much useless.
With those Facebook friends, most of the conversations that you have with those 10,000 people are general conversation.
There's a famous phrase by Eleanor Roosevelt that says "Great minds talk about ideas average Minds talk about events and small minds talk about people."
If you look at the lowest form of conversation, you're just gossiping.
This is what's juicy.
You look at the news headlines, and they're gossipy. They suck you in.
If you look at those news reports as well especially stock market channels, a lot of them are talking about people. And people in the stock market world is stocks.
Let me bring you back to this point of when you're talking about stocks, and you're talking about people. It's because it's in gossip form. It's a form to suck you in to say hey this stock is hot, and this is a sexy stock. Why is it sexy? It's sexy because hey they got this new product coming out. This is launching next week. The earnings are great, the CEOs got this going on, and it is interesting because we're gossiping about it.
That's not great socializing. That's not a great conversation for you personally to help your portfolio, to take you to that next level.
What will take you to the next level?
Let's look at events
As we start taking a look at events, we're looking at history. You look at what's happened in the past. You're looking at what could happen in the future.
Now you're talking about historical chart patterns, maybe you're talking about what could happen in the future. What do they have coming out?
This is much better.
We look at this, this is much better because you're talking about what have they done in the past, how have they grown, and how are things involving these are events.
You're looking at a perspective of time.
What's the best form? Ideas
But you get very little of that on TV news channels and a lot of the reports that maybe have huge viewership.
Very few have ideas. If they do, it's a very small or limited amount. It might be a minute clip.
When we talk about ideas in the marketplace, we're talking about looking at a trade setup.
Here's a trade setup idea for you, this is how you manage it.
How do we make things better? How do we make things better for education? How do we make things better, so we have less poverty?
That's not an idea. It's more talking about people.
How do I do the trade set up? What would I do to take profits? Or what would I do to take losses? What is that set up? What is that idea? What is that situation going to do for my portfolio?
That's really what you want to focus on.
But the majority of the conversation is not about ideas - a majority of discussion in the stock market world is gossip. Just like it is in nine out of ten news reports and channels. It's about people.
Which, in our industry, if we look at stocks, it's about stocks. What's the hottest stock? What is the stock doing?
It's gossip about stocks which is the same concept of gossiping about people.
Then you get to events - which is a little better because now you're looking at historical things. If you can get and find the ideas, which is very rare, that is the best approach because that's where it takes your mindset to that higher level.
Beyond that, you're just really looking at tons and tons of quantity tons and tons of juicy gossip that sucks you in. Talking about those hot things that are attractive, that you can't avoid. But it doesn't take you to that next level.
It doesn't make you better in this space.