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Do You Have What It Takes To Manage Money?
Everyone has an opinion when it comes to investing it seems. The area of investing attracts wishful thinking, over exuberance and self delusion. If you have done any cognitive training you will agree that reading or watching financial news is often akin to watching a comedy show.
Things are put into perspective when you remind yourself that most of the writers and speakers have never earned a living trading or investing.
It is a fact that investing and its racy cousin trading are areas where everyone can be an expert without training.
The need to follow our ego desires is huge. The regular boom and bust cycles one can observe in many different time frames are proof.
Most of us lack the ability to assess ourselves, let alone market cycles correctly. Understanding your own true nature and the nature of the markets is a skill that few have. It requires training, total honesty with oneself and the discipline to stay unattached to your ego's story. These are basic requirements to be a good investor and trader.
There is a wide spread belief that all it takes to handle money and make it grow quickly is to go to a seminar put a few grand on the table and, hey presto, the following week you will emerge a master trader and investor.
The vast majority of people, 95%, lose money in the markets. Today's market conditions are more difficult than they have been for decades. The need for cast iron discipline and sound knowledge of market dynamics and psychology are more essential than ever before.
As with other areas in life, psychology is key to success. You can only be successful in trading and investing if you can handle yourself. This means that you must be willing to work on yourself to acquire a trading mind set.
A trading mind set is calm, quiet, Zen like. It has no concept of the future, as the future is always uncertain. The trading mind can wait. It is comfortable with waiting and when the right opportunity presents itself it is ready to pounce. There is no hesitation, but just clarity, certainty and flawless action.
A trading mind set is about independence. It does not matter what the papers are saying, or what investment advisors think. You are only in conference with yourself. There is no competition, but you are competing against yourself, or should I be saying with yourself?
Your ability to act quickly on limited information is vital. So is your ability to foresee change. Most of us are not comfortable with change, yet in order to be good at trading and investing you should be aware that this is an essential skill you must master.
You must understand risk. Risk is not so much about winning and losing, but about limiting exposure to the market in the event of things going against your expectations.
Are you at peace with yourself? How is your relationship with money? Both should be in harmony. This means that you can forgive yourself even if you lose. Ultimately it is always about you. How you see yourself, how your inner talk supports you and your view of things around you.
This is the most important aspect of your life as successful trader or investor.
Mastery of any subject always begins with the mastery of the self. Are you willing to work on yourself and become that person who will be good at trading or investing before you even start looking at charts? Are you willing to learn how universal forces operate in everything, including the financial markets? If the answer is yes you have passed the first and most important hurdle on the road to trading and investment success.
Mercedes Oestermann van Essen specialises in trading and investment psychology. She trades derivatives and coaches traders. She has written a number of books on manifestation techniques and trading psychology. Sign up to her free course: 5 Little Known Secrets To Happiness.
www.ThroughHappiness.com
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