If you trade long enough, you will notice ego being talked about a lot, whether it’s through trading blogs, podcasts, videos or books; ego will pop up. You might even start to ponder if your ego (we all have egos) poses a problem to your trading and so you might try to find out more on it like I did. Ego and trading is what I’m going to write about in today’s post.
The more I read about ego, the more obvious it became to me that it could cause some serious problems in trading as it did for me. But first you have to realize that we all have egos and just because we have egos does not mean that all of us will encounter trading problems because of it. In my mind trading problems caused by ego normally comes from having a big / inflated one. Also, problems with a big / inflated ego would be present in your life in general, long before you started trading. Below follows a couple of signs that are suggestive of a big / inflated ego and some examples of how it could influence your trading:
- People that must always win:
Think of how it will be for the person who always wants to win. What a struggle it must be for such a person trying to trade – a game where trading plans with 50/50 win/loss ratios are common.
- People requiring constant recognition:
Imagine the person who seeks constant recognition; will he / she be able to accept losing trades, let alone be able to talk about losing trades. What would such a trader do if he / she craves recognition?
- People always wanting to be right:
This one explains itself. Can such a person accept a loss? Will the person who always wants to be right be able to accept a trading strategy with a 50% win rate for example or will he / she always be looking for the holy grail of trading?
- People always wanting more:
Imagine a person always wanting more in life being a trader. This could be very dangerous in trading. Think of a trader (for example) that’s on a winning streak and then wanting more, starts taking bigger and bigger trades, risking more and more – can that be sustainable?
- People always defending themselves:
Think of those people that always blame everything and everyone but themselves in order to defend themselves. Now translate that into a trading; the trader trying to justify a loss for example? It was the market, the news, someone distracted me, etc etc; always blaming outside factors and never looking at himself / herself.
I like this quote from “Ego is the Enemy” by Ryan Holiday on ego:
“Ego is the enemy- giving us wicked feedback, disconnected from reality. It’s defensive, precisely when we cannot afford to be defensive. It blocks us from improving by telling us that we don’t need to improve. Then we wonder why we don’t get the results we want, why others are better and why their success is more lasting.”
The above quote embodies much of what I’m trying to say. We all are guilty of what I wrote above in one way or another; in trading or in life.
There is a lot written about how a person can tone down his / her ego like practicing gratitude, humbleness, kindness and honesty to mention a few; but from my experience I think it’s best to first recognise and admit that you have a big / inflated ego and then take it from there.
I will end with another quote, also from “Ego is the Enemy” by Ryan Holiday:
“Greatness comes from humble beginnings; it comes from grunt work. It means that you are the least important person in the room until you change that with results” and he also writes just after that: “There is and old saying, “Say little, do much.””
Stay humble, work hard. Work on yourself and your trading more than talking about it; let the results speak instead.
I hope you enjoyed this post.
Regards,
Trading SOS SOS