Breaking Free from the Baffling Mystery of Giving It All Back

I want you to think of a time when you're on a roll. You were really doing it well. I mean, you are in sync with the markets, and you. You were just absolutely walking side by side with it. You were winning, you had made a good bit of money. And, you know, he said, okay, okay. And then what happens is you come back and all of a sudden something happens. And before you know it, in the flash of a light, all that money has been lost and then some.

That's one of the most common problems in trading. As you sit there and you go, wow, I finally got it. I'm in sync here. You know something? I am really. I'm on target. Nothing can stop me. I am doing this right. I've got it. And then you take a break, you come back, and sudden it changes, and you don't know how to get back. And before you know it, you've taken a loss, maybe two, and before you know it, then you're just absolutely going after it. You. Then you give it all back.

Now, how does that happen? What I want you to notice right there is that you're looking at it going, I don't know what happened, Randy. You know, I was sitting there and everything was going fine, and then something happened and I snapped. And all of a sudden I started losing, and I couldn't stop, and I couldn't. Before it was over with, I was boof. What you've just experienced is an emotional pattern. Firing that at one time would have been very useful to your caveman ancestors, was so useful to get it wired in as habit. And it got just absolutely hardwired. It became instinct. And what happens is you grow up. You go beyond the humanoid that you used to be, and now you're homo sapien. But understand this, you're still a great ape. You still have an animal brain. It's called the mammalian brain. We share it with the other apes. And it just so happens a lot of it is working on instinct. What you've run into is something where, you know, caveman, you know, it was here this moment. You know something. All you had to do is win this moment. And that was it. It didn't seem long term. It had to win the fight then. Whereas in trading, it's a probability mindset and not a certainty mindset. You're sitting there and you're going, I have to work probability, where I know I'm going to be taking losses and it's going to be swinging back and forth. But my edge, if I maintain myself, I will see through And I will be consistently profitable. Well, until you train that ancient brain of yours, a new trick about how to work with this new world called trading versus the certainty of living, you're going to continue to do the same thing. It's habituated, it's instinct. And the question is here, what stops most traders from becoming successful is a very low eq, emotional intelligence. They know, they have the knowledge. That's not the problem. They have good knowledge. The problem is they don't know how to use emotions to build mind. And why is that important? Because all thinking is emotional state dependent. When you look at a performance like all that winning you were doing, most likely your brain was in sync and it had the right emotions to come to to bring a mind that could trade effectively. At some moment, it started hitting the dopamine reward system. Okay, Every time you won, you get a little squirt of dopamine into your body and all of a sudden you feel good. The problem is this, in caveman times, winning meant you survived, you felt good, and then you went on to the next challenge. In trading, what happens is probability. The mind that you need to be able to trade with sober emotions has nothing to do with feeling good. Yet you started feeling good when you started winning. And feeling good is hitting the dopamine reward system. That, my friends, is where the, that's where the problem was. Dopamine is very similar.

To cocaine. Okay? Now, would you snort a line of cocaine and then trade? I certainly hope not. Because what happens is when you take that cocaine, suddenly you, you're just sitting there, you're in euphoria, everything's great, everything's wonderful. You know, the good times are going to roll on forever. Everything's great. Well, that's not the way the trading gods design trading. And so you've already bringing a mind based on the emotions and into the game that's incapable of producing the performances you need. Meanwhile, if you were to say, okay, I am going to sit there and say, I'm not going to let that dopamine circuit find all those rewards and put me into euphoria where I become overconfident and I start doing really dumb, stupid things and it catches up with me. That's what happens when you give all your money back after winning. What I'm going to do is I'm going to recognize that winning can be dangerous. What I need is not to win and make money, to have power, to have respect, all that. No, what you want to do is you want to perform well. If you perform well, that psychology of performance will activate, guess what, your edge in trading. And it's going to extract more capital out of the markets then you put back in. And when you're building that mind, what you're going to discover you want. What you want is discipline. What you want is patience. What you want is impartiality. That's going to give rise to the probability based mind that can extract your method edge. That's not what happens when you end up winning and winning and winning and then giving it all back. You've got euphoric. Okay, and I'll give you an example of this. I was traveling, teaching, lecturing in China several years ago and I was in this large auditorium with really large massive fund and we were talking about the management of uncertainty. And I said the one thing that you can't afford to when you're investing in risk, when you're trading, you cannot allow yourself to feel good. Feel good is the death of the trading mind. It takes you into that thing of where you think the good times are going to roll on forever. Instead what you want is you want to manufacture from emotional intelligence that cocktail of emotions of discipline, patience and impartiality. Doing that, you create a mind that comes out of the emotional ground that can in fact maintain order of itself, that can maintain saying, you know something, I'm winning.

But to that empowered mind, winning only means landing on the right side of probability relative to you. It doesn't say anything about your stature. It doesn't say anything about how important you are, how powerful you are, how safe you are. It just means you landed on the right side of probability. If you take a loss. Oh, bummer. If you take a loss, all it means is you landed on the wrong side of probability relative to you. And if you take a look at that, if you say take a loss on that and you go, okay, is this a method mistake? And you say, no, it's not, I followed my plan. Is it a psychological mistake? No, I handled it really well.

So you just landed on the wrong side of probability because of probability, right? Yeah, that's success. That's the trading mind that has done its job. That allows you to have the edge to pour more, pull more capital out of the markets than you give back. It's not winning and losing. Winning and losing takes on a very different nature. You learn from losses. You know, the brain does not learn from success.

All that dopamine just messes up everything. Okay, you learn, the brain learns from failure. The failure forces the brain to re, explore Relook, rethink, recalculate. A new way of putting patterns together that can, in fact, engage the uncertainties of life more successfully. What you want, though, is you want the losing mentality to be learning, to be curious, and to recognize. By losing, I have the opportunity of learning this, my friends, is emotional intelligence. You're learning about the way the brain works. You're learning about what makes it tick and how to use it. So you become an intelligent user of emotions. It's not like you can deal without emotions. We are not rational beings. We are rationalizing beings. We are emotional beings. And we think based on that emotion that we're coming from. So the deal is, how do you emotionally intelligently pull emotions together to produce an emotional cocktail that gives rise to the trading mind? That, friends, is what we want to learn. That's what we want to learn how to do proficiently. To do that, you're going to have to learn a process that allows you to first recognize emotions are already there and that you don't have emotions, they're having you. But what you have is that you can use emotions intelligently to produce a powerful mind for trading. The that can be done, that can be taught. And from there, what you're doing is you're saying, I'm going to manage that, to make sure that I stay within a particular zone. And the moment that you feel euphoria, confidence, feeling good, come in, you know that you're in danger. You need to pull that back, reestablish the mind, and go back in again. That's how it's done. Friends, can you learn how to do this? Absolutely. I teach it all the time. What I encourage you to do is to come to the webinar associated with this video. I encourage you to come to our website, go to the YouTube channel, and take a look at the wealth of information, the knowledge there that allows you to educate yourself emotionally so you become emotionally richly smart and can use those emotions much more powerfully than trying to say, I want to win because it makes me feel good. I don't want to lose because I'm a loser and I don't want that. No, what happens is you have to get beyond that. You have to recognize that what you control in trading is the mind you bring into the moment. Winning and losing is not under your control. They will take care of themselves if you intelligently use your emotions to build the mind that can trade. Come and learn, friends. Come and learn.

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