The Right Attitude

“Whether you think you can or think you can’t you’re right.” Henry Ford

Much has been said about how one’s attitude can determine one’s outcome. Time and time again this has proven to be true.

“The last of the human freedoms is to choose one’s attitude in any given set of circumstances.” Viktor E. Frankl

For traders, the fact remains that a positive attitude creates positive expectations which lead to positive results. The opposite is also true – a negative attitude creates negative expectations and therefore leads to negative results. Either way, these emotions and attitudes will determine your actions.

Your trading success will be based on accepting the fact that losses are a part of trading and in spite of that, you will remain confident to execute trades and follow the rules of your trading plan. That is the blueprint for profitable trading in a nutshell.

Your confidence will grow as you learn what works and what does not. The more you begin to repeat what does work, you will become disciplined to ignore what does not. Your confidence will grow as you begin to believe in your ability to focus on what works, take the correct action over and over again, and accept the outcome. This positive growth pattern will diminish the fear, remove the emotional investment and lead to consistent action.

Consistent action can only come when you accept both emotionally and financially that losses are a part of trading.

Notice others that participate in highly competitive fields – professional sports for example. They accept the risk of a loss before ever stepping on the field of play and still expect to win – that is, they have a positive attitude.

Imagine how crippling it would be if every time the team lost, they gave up, or let the loss devastate them emotionally to the point where they expected to lose or could not bring themselves to even go back on the field (a negative attitude, to say the least.) They know they cannot change the past – so why dwell on it. They know that one game, or one contest, is just one of many they will compete in, so why let one result determine the outcome of the others.

They know that to win, they must quickly recover from a loss. They evaluate what worked and what didn’t, make adjustments to their plan, and prepare for the next contest – all with the positive expectation (confidence) that they will win the next time, execute their plan, and not repeat the same mistakes.

It’s the same in trading. Starting off with the right attitude, knowing losses (assumption of risk) are part of the game and shaking off mistakes are all essential if your goal is to be a consistent winner.

‘Winning traders learn from mistakes, losing traders repeat them.” Jason Stapleton

Be positive, stay positive, learn from your mistakes, follow your plan and accept the responsibility and risk that comes with being a winning trader.

What are your techniques or strategies for staying positive after a loss. How long did it take for you to accept that losses are a part of trading? What keeps you focused and optimistic?

Make a list and reinforce those insights.

Rick

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