Rande Howell
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“On the surface executing a simple written trade plan should not be difficult, yet I am not able to do this simple task consistently. What I understand is that this sabotage comes out of self limiting beliefs that I am blind to. I’m not sure what beliefs are driving my performance, how do I find them?” remarks a deeply passionate, but troubled, trader.
Biological Bias to Believe in Prediction
The first problem is that trading is in many ways is a very unnatural environment for the brain to negotiate. The brain is constantly attempting to produce certainty in a world that is uncertain in its nature. This bias toward certainty closes down the kind of probability mindset that trading demands. What that looks like in trading is trying to predict what the market will do rather than take advantage of what the market is willing to give you. And the trader experiences fear of loss or exhilaration of winning rather than the ebb and flow of probability.
Belief That the Market is a Dangerous Place
The second piece of this problem is that uncertainty becomes fused to worry and fear. Uncertainty then becomes synonymous with worry and fear. This is a particular wiring that has to be de-constructed and rebuilt so that uncertainty can be dealt with from more empowered emotions and states of mind. It's not going to change just because you say so though. Changing neurally hardwired beliefs is not easy; just ask any dieter or recovering alcoholic. To our ancestors, uncertainty was a bad thing. And our brain evolved to jump to conclusions because any explanation was better than staying in the confusion that uncertainty can cause. To the ancient brain any explanation is better than confusion. This wiring of perception is downright dangerous in trading.
The market does not care if you are present in it. It has no negative or positive intention directed toward you. It simply is. The mindset, or belief, you bring to the market is what opens or closes the range of possibilities that become probable for you.
Belief in the External Validation of the Self
This is confusing assessment of performance with judgment of being. The second part is that in facing your psychological demons, we have a bias to look outside the self to assign blame and responsibility. I actually have traders put a mirror near their screens so they can see themselves and hold themselves responsible for the mindset that is being reflected back at them because emotion state meaning is embodied in the muscles that work the eye.
At the core of poor performance (assuming competency in methodology) are self limiting beliefs rooted in a sense of inadequacy (not good enough), a sense of not mattering (must win to prove myself), a sense of not being worthy (having to prove your value as human by your performance), and of powerlessness. The value of a human being becomes externally validated (trading performance) rather than a reflection of his current skill level.
Skills are something that can be improved and mistakes show you where you need to improve -- rather than being a reflection of the self. But it is both biologically and psychologically easier to deceive ourselves and project blame and responsibility to the outside world. We even develop personas, handles, and other cover ups to mask our deepest fears rather than confront them. The problem is that if they stay hidden, they will continue to sabotage your trading and trading account.
When you are experiencing a fear of loss, a fear of pulling the trigger, a fear of not being right (perfectionism), a fear of loss while in a trade, or are beating yourself up after a loss -- you are experiencing the deeper fear based beliefs outlined above. Your brain's adaptation to them has produced a familiar pattern of belief that has hijacked your thinking.
Trading as Mirror to Self Limiting Beliefs
Trading becomes a mirror to the deepest sense of self. But you do have to develop the courage to confront the inner garbage that has taken up residence in your belief system and rigorously change your beliefs about self. Traders can take many years wandering around in the wilderness before they really begin looking at themselves rigorously and realizing that it is their beliefs that are trading. This is when they come to the motivation to re-invent their beliefs. Most traders come to develop a deeper sense of their spirituality to do this. This is where you move from a sense of self that uses external validation to determine their value (cars, houses, etc) to sense of self that is grounded in a sense of worth beyond their understanding and found inwardly.
A deep sense of their worth as a human being allows a trader to access the discipline, courage, impartiality, and compassion that is part of his human heritage. Moving beyond the need to prove the self by performance to a past relative, culture, or person opens a vast new door in the state of mind that becomes available to the trader. Your beliefs can be molded to take advantage of what the market is willing to give you. Your beliefs move from self limiting to self empowerment.
What does this stir in you concerning your trading and your beliefs?
Rande Howell
