[Tradewinds]

"Most people think that they're playing against the market, but the market doesn't care. You're really playing against yourself."

"Trading Without Ego"
by
Ruth Barrons Roosevelt

I searched threads for the word "ego" in the title, and there were no results, so I thought I'd start a thread titled "Ego and Trading".

My opinion is, that trading is a mixture of playing against the market and against ourselves.

What is the Ego made up of? How does it affect trading? Is there a good and a bad Ego? The implication is, that Ego is bad, and it hurts our trading results. The Ego is about ourselves. The negative implication of Ego, is that it is an inward and selfish thing, something that leads us to believe false things and deceive ourselves, which then leads to irrational and self-destructive behavior.

In trading, it could take the form of thinking that we know something, when we really don't know much, and in fact might just be fooling ourselves. Or it may take the form or thinking that we can will the market to do what we want.

What do you think?

[SIUYA]

taking away all the sayings we know and love - eg; dont fight the market, be flexible, the market does not care, the market is always right, etc; etc;
and adding into the mix the various descriptions of ego and the ideas associated with what ego is, and how we relate to it.

my two cents....
Ego and trading dont mix.
the market is not a place to find your self, but the market will definitely find you out

[MightyMouse]

Pride, the symptom of ego, is one of the seven deadly sins.

I read somewhere at some point that if someone were to say something to you that would have the affect of "crushing" your ego, that you should thank them instead of feeling hurt.

The fear of loss is the fear of doing damage to your ego.

I started a thread to post es trades or other short term trades as legitimately as possible. In doing so, I am bare naked. There can be no lies. There is a level of vulnerability, but for me it is a trace feeling. I used to care, but i really do not care what anyone thinks if they do not see me make money or if what i do appears to be a mistake to others or whatever the case may be. I have been the only one posting trades. My guess is that traders risk exposing the reality of their trade decisions and that causes pain or anxiety. It is easier and best to protect their egos and say they made money without showing that they actually made decisions that lead to profits.

Of course, I could be completely wrong about that.

[TheNegotiator]

I think we trade the markets but we hinder ourselves much of the time in various different ways including with our egos. The trouble is, self belief and conviction can easily be confused with what is actually ego. But self belief and conviction, once you have grasped a greater proportion of the day to day realities of the markets you trade, are of course what can make you a great trader. But also, self belief and conviction can also be mistakenly misplaced from a different profession or endeavour into trading, where the game can be quite different. You then see a new trader with potentially fantastic attributes to trade, shrivel up and shy away from the personality that may have made them one day, a highly successful trader.

My belief is therefore to be a success in trading, either be a confident thinker about all these psychological aspects combined with market dynamics, or don't think about ego at all. Just do what works and look after your account. There have many very successful traders in the past who weren't necessarily the most academically gifted. Historically you'd see this in the pit. Ultimately for many of these guys it was about fight or flight.

[Tradewinds]

Originally Posted by MightyMouse »

It is easier and best to protect their egos and say they made money without showing that they actually made decisions that lead to profits.

Of course, I could be completely wrong about that.

It's not just trading, people don't go around "spilling their guts" about their flaws and failures. It's a mentality of not showing weakness. Pain avoidance is hardwired into our brain.

I've been developing my trading skills and my strategy for over 3 years. I have lost some money trading, but maybe a couple thousand at the most. The reason I haven't lost much money, is because I trade only simulated trading for the most part.

My ego wants to be successful, make a lot of money, and feel like I actually know what I'm talking about. But before I get to that point, I can either participate, or be afraid of getting involved in discussions. It's part of the learning process.

One thing I have noticed, and it's not just trading, is that when people have put a lot of time and effort into learning something, sometimes they get a bad attitude. I help people on a programing group, and I answer even the stupidest questions with a helpful and encouraging demeanor. It's because that's the kind of person I want to be. In the beginning, I just started posting what I had figured out on my own. And I was annoyed at these people who have this superiority complex because they are at a higher level than others. It sometimes happens, that more experienced people act like a new person who doesn't know anything is like an annoying bug that should be squashed.

So that's part of the reason people don't make their failures and weaknesses known.

But back to your point. It's good to be transparent, and stop caring about what other people might think.

[Tradewinds]

Whenever I get on the bad side of a trade, I think to myself, "If I can only get out of this trade at a one tick profit." Then I put in an order to exit at the smallest possible profit. What often happens, is that the price comes back to a profit, goes through my exit, and keeps on going.
My point is, I need to do what my indicators tell me to do. So I program signals that tell me what the pressure is on the price.

[SIUYA]

Originally Posted by Tradewinds »

Whenever I get on the bad side of a trade, I think to myself, "If I can only get out of this trade at a one tick profit." Then I put in an order to exit at the smallest possible profit. What often happens, is that the price comes back to a profit, goes through my exit, and keeps on going.
My point is, I need to do what my indicators tell me to do. So I program signals that tell me what the pressure is on the price.

error number one - you are in a bad trade - get out.
Instead you stick in an order to get out for a one tick profit......that to me is insanity, because you have already decided its a bad trade. If it finally becomes a good trade - through luck/chaos/randomness.....you decide to exit.
This is a plan designed to keep losers and exit winners.

you would be better off working out how to exit quickly- when the trade goes badly, and then being prepared to re-enter....and not sit there and think as many do - "well the market screwed me again"

[Tradewinds]

Originally Posted by SIUYA »

you are in a bad trade - get out.
Instead you stick in an order to get out for a one tick profit......that to me is insanity,

Yes. It is insanity! You are right. Which actually might be a helpful bit of information. I can tell myself. THIS IS INSANITY!! Hopefully it will motivate me to change my behavior. We will see. If I ever do become sane, I'll post my equity curve to prove that I won the internal battle.