There’s a lot to learn to become a good trader. A lot of market understanding, strategies, and techniques. But sometimes it’s the things that seem completely unrelated to trading that teach us the most about it. And our task is to find those analogies and to use them to our advantage. Find one different way of looking at things, and your whole trading can change.
How Mark Twain Can Make You a Better Trader
The inability to forget is infinitely more devastating than the inability to remember. – Mark Twain
Twain wasn’t talking about trading when he wrote this, but nothing rings more true to anyone who has traded the markets seriously. In life, if you can’t forget your failures, disappointments, and past hurts, you will be miserable. It’ll be hard to be happy, and you’ll have almost no chance to bounce back and succeed. It’s the same way in trading. Your inability to forget- losses, missed opportunities, mistakes- will kill your trading. You’ll be in a continually negative state of mind, full of doubt and low on confidence.
So the message is clear. You have to forget. You have to have what is called “instant amnesia” when it comes to losses and mistakes. Once they’ve happened, you instantly forget and move on. If there’s a lesson, take the lesson and move on. It’ll feel like you need to linger on it and punish yourself. Your mind tells you that you’re not taking things seriously or trying hard enough unless you make a big deal of it and keep it firmly in mind. But don’t fall for that trap. It’s not about mental effort. It’s about your bottom-line. And nothing will hurt you more than replaying losses and mistakes in your head over and over. So recognize the trap and ask yourself if you want to make things worse. If you don’t, simply let it go and move on. As unnatural and too “laid back” as that feels, it’s what gets results. And that’s all that matters.
How The Great NBA Shooters Can Make You a Better Trader
Not only do great NBA shooters practice instant amnesia, they take it a step further. If a great shooter like Reggie Miller makes his first few shots in a game, he thinks “Man… I’m on tonight. I can’t miss. I’m going to shoot amazing this game.” But if he misses his first few shots, he thinks “Man… I got the misses out of the way early. I’m going to shoot amazing this game.”
What? Whether they make their first shots or miss them, great shooters think they’re going to do great? Yes. As crazy as that sounds, it’s true. And for those people who are going to ask how they can have it both ways, the answer is that it’s all a matter of choice. Who said you can’t have it both ways? Who said you can’t be confident when you make them, and be confident when you miss them? You can believe whatever you want to. Ultimately, all beliefs are just lies. They are just our interpretation of reality. And they can be harmful lies or useful lies. Choose the useful ones. Be the architect of your life- and your trading.
Use Everything Around You
You don’t have to limit this to Mark Twain or NBA shooters. Every area of life is full of analogies that can help you in your trading. There are competitors in every field who deal with the same type of psychological issues as you, and who have found creative ways that can inspire you. There are philosophers who lived 2000 years ago that spoke truths that can raise your trading to another level. It’s all around you. Look for it, and cross it over to the world of trading.
And if you’re up for it, I have an assignment for you. I want you to find something outside of trading that can make you a better trader. Whether it’s from the world of sports, or chess, or philosophy, or politics, or anything in life, what is one insight you’ve heard or read about that you can transfer over to your trading? Really think about it, and stretch your mind. Because if you can find something that has personal meaning to you, it can really take your game to another level. And if you do find or already have something, I’d love to hear about it in the comments below. Let’s all help each other become better traders.