Taking Big Risks
Some people have taken risks their whole lives. They have rock solid confidence and often feel they have nothing to lose. Other people are afraid to take risks. A person's unwavering sense of confidence has a lot to do with past experiences, the successes achieved and the roadblocks overcome. A fear of risk taking may reflect a lack of confidence but also a secret fear of success.
Why would anyone want to avoid success? Obviously, most people dream of success. Who wouldn't want a beautiful spouse, loving children, and more money than you could possibly spend? Even if you are deeply spiritual, you must admit that if you found the proverbial genie in a bottle, one of your first wishes would be immense wealth. That's not to say that money is the most important thing in life, but let's just admit that most of us would ask for our wildest dreams to come true if given the opportunity. People do want success. However, there are dreams on the one hand, and what we believe we can have in reality on the other.
People may love to win and succeed, but they hate losing more than they enjoy winning. Regret can sometimes be more powerful than greed, according to behavioral economists. Humans can't stand the idea of mulling over a bad decision. The motive to avoid regret is a major reason traders unconsciously sabotage their efforts. People with wavering confidence need a way to save face. The best way to save face is to be able to have an excuse when you fail. You can always rationalize a failure away by thinking, "I could have done it if I had tried harder." It's all quite understandable. Why take a risk, get hurt, and regret it later?
If you never take a risk, you will always be able to tell yourself that you could have made it if you had tried harder. This attitude, however, is a hindrance in the long run. Rather than search for high probability trading setups, traders who fear success often take the first setup that comes along. Again, if they don't put in their best effort, they will be able to fantasize about how things could have worked out wonderfully if they had just tried harder. Other ways to sabotage your efforts are to trade by the seat of your pants instead of carefully outlining a trading plan and following it. An excuse for failure is the best defense against regret.
How can you beat the motive for denial and self-sabotage? First, you can think more optimistically. Don't believe in the impossible, though. That's unrealistic and will eventually lead to disappointment. It is unlikely, for example, that you can turn $10,000 into a few million in a year. It isn't going to happen unless you find a genie in a bottle. But if you accept what you can do, you'll find you are on the right path. It's fun to dream about great riches, but you'll find achieving a successful reality, whatever reality you were meant to have, more satisfying. You don't need to be a virtuoso trader. You just need to be a winning trader, and if you put in the work and effort, you can make it. So stop dreaming. Stop sabotaging your efforts. Accept what you can do, and when you achieve success, celebrate. Appreciate what you can do, and stop striving for the impossible. If you trade with realistic expectations, and put in the required effort, you'll feel satisfied, and ironically, you will actually end up as one of the rare few who become profitable traders.