Build a Winning Trading Psychology Mindset

How do you build a winning trading psychology mindset?

Let's start with what is your goal? Trading may sound weird, but it's not. You know, most people, their goal, quite understandably, is that they want to make money, they want to win, and they certainly don't want to lose.

And most likely that's proven successful in other areas of their life. And so they bring that success formula in about winning, and they get to it. All of a sudden they discover something is really wrong. Somebody didn't say something to you because you're unprepared for. Suddenly, I can do it. I can do it in simulation when the money's not real, but suddenly when that money gets real, all sorts of stuff starts happening. I can no longer actually trade my plan and plan my trade. It's just, boom, it's totally different. So you're looking at that goal and saying, yeah, I want to win. I want to be financially successful. Yeah, I want to make money. Every day I get up thinking, I want to make money. Well, this is the great divide. What you're going to have to decide in order to evolve into the trading mind that can produce success. You're going to have to decide whether or not winning is about making money or if winning is about performing well.

Spoiler alert. Making money focused, as that's the definition of winning, is not going to work. Performing well will. And then to be able to build that successful winning trading psychology mindset, you're also going to have to learn how to lose exceptionally well. And this brings us to the paradox between winning and performing well, winning and performing. What do you really want to do? A lot of people come into trading with substantial success, winning ways from businesses, for corporations, and they think, golly, you know, this thing has worked so well in lots of areas of my life. I'm just going to duplicate this system of success I've had in one domain. And I'm going to bring it, guess where I'm going to bring it to trading, and I'm going to produce success there. Yeah, that's just what I'm going to do. They do that. And understandably, you can understand why they bring it. It's produced success in the past, why not now? The question, though, and this is the flaw in the winning traditional winning way that can you control winning in trading? Not in your other business or corporation, but can you control winning in trading? No, you can't. And yet your entire brain is organized to be able to win versus being patient and waiting. It's a paradox, friends. And what I want to do is I want to give you an example of two apex predators, each adapted for a different environment. There's nothing wrong with the success that you've experienced in other domains. The problem is it's built for that environment, not for the trading environment. And the example I give is the difference between the African lion and the American cougar. One hunts on the savannas of Africa in large packs that they constantly have to be breeding and building more population because the way they stalk and attack, they end up having lots of injuries. They have lots of losses, major ones, too. You get kicked by a buffalo and most likely you're going to lose your jaw. You get gored by impala and it punctures a lung. So they're constantly having to replenish their capital, more bodies for hunting. That that success story works well in those circumstances where they have the ability to breed very large amounts of puppies coming up to become, to replace all the losses. Okay, now you took that same lion incredibly successful, and take him into the American forests, and guess what? He starves. Yet there's another apex predator, the American cougar. And what he does is he has a completely different strategy. He's not stalking, he's not chasing. What he's doing is he's ambushing. He's an ambush predator. Ambush predators have to have a lot of patience. And what the cougar does, he climbs a tree, goes out on a limb, looking right down to where the deer is going to pass. It's a setup. And then he waits patiently, waits patiently. And you might look at the cougar waiting patiently for the deer to set up in the trap and think he's just lazy, he's just sleeping. No, he's not. He's calmly waiting for his dinner, for reward. When the deer comes into that trap, into that setup, it drops down from, oh, 20ft, got a head of steam and hits the deer in the head and the neck and snaps it. The deer drops down dead. There is no struggle, there's very little losses. And if the deer does get up and leave and runs away, the cougar is not going to chase. What it's going to do is it's going to cut its loss. It's going to climb back up to the tree, go out on the limb and wait for the next deer to show up in the setup. Sounds a lot like trading, doesn't it? Well, it is. And what you also see is alphas coming in with an idea of success and realizing that in the environment of trading, it Just doesn't work. Yet. You take a look at what the cougar does and understand it's alpha, it's apex predator, man.

If you ever been around one, you know what I mean? And what you see though is they hunt differently. They're patient, they're focused, they're ready and then they ambush. That's the whole point. And this is where you're going to have to learn to be a different kind of hunter than the one that you came equipped with.

And this, my friends, is where you begin to have to realize that you.

Are going to have to evolve the trading brain, the one that you brought with you, okay? It was also built for the African savannas. It was looking out and finding all sorts of reasons to be fearful because we were a hunted type of animal. And all those lions, tigers and bears are gone now, but yet we're there. We bring that. And we were hunter gatherers. Our huntings went out and stalked and we stalked big prey, okay? Yet we take that mind and we take it to trading. And there's a couple glaring problems. One is that brain is built to win. It is built to control, particularly control outcome. It is built to be right because to be wrong was to be dead, okay? And it was built to find causal relationships in things in the, in the environment. That's much like you using technical analysis to find out where the exact bottom is going to be. That's the causal relationship. All those things allowed us to become an incredibly successful species. Then we took that brain designed for that environment, we took it out of that environment and we put it into a completely new different one. One that it's not adapted for trading, where you have no control over outcome, maybe a probability.

And also that desire to make things happen becomes a liability. You know, that can do attitude becomes a liability. You have to have patience.

And are you going to win? No. Are you going to do a lot of losing? Yeah. And you're going to have to become a superb loser. You're going to have to see losing as just part of the game and you're going to have to learn to do it incredibly well.

So ultimately you've got a problem. You've got a caveman brain that you brought from antiquity, but you need a probability based mind that is alien to the caveman. You're going to have to build that. And what's really interesting is the whole notion of winning and losing really has to change. That's at the cor the problem. Winning, you know, makes you feel good. A truly good trader. When he wins. He actually goes and makes sure that he doesn't exaggerate the overconfidence. He stays calm, he stays clicked. And he knows that he does not control outcome. What he did is he landed on the right side of probability relative to him, okay? He didn't make things happen. He had probability on his side, but he didn't know, okay, which way it was going to fall. That's also why he has to be a good loser. If it doesn't happen his way. If his guess is wrong, he needs to keep that loss small rather than adding to it or blowing it up or revenge trading or going crazy. So that's that winning thing. And what happens is that when you do lose and you follow your rules, you learn to shape that behavior. You learn to congratulate yourself. You have gratitude that you followed your rules, okay, and it didn't work out. That's the probability. This is training, deep training. And you have to get inside and find that part of you that has a deep desire to win. And you have to calm it down. You have to retrain that. You have to cool it, cool it down. So ultimately, this is about becoming a good winner, landing on the right side of probability, whereas losing.

Really becomes landing on the wrong side of probability. From your perspective, it could have been the other way. But the thing is, is it didn't hit that probability, and you just simply take the loss. Because if you don't take the loss at where it no longer fills your plan, that's the edge that you have in the markets you're gambling. So you're going, wow, Being a good winner takes all the fun out of trading in some ways. Well, it does. It makes it pretty boring. Sometimes Being a good loser is an engagement you realize you have to. Instead of going, oh, man, I hate losing. It's going, nah, I did a really good job.

So ultimately, what do you control?

You control the mind that you bring to the performance of trading. That's what you control. Not the outcome. Not making things happen, not being right, not being wrong or predicting what happens is you bring a mind that can perform really well. It can stay calm and cool, collected, disciplined. As you're engaging uncertainty, what you've done is you've lowered the threshold between fear and uncertainty. The caveman brain can't separate uncertainty from fear. And there you see the problem why so many traders lose. What your job is to do is to manage that performance and stay in the moment of performance as you trade. That's the key. Friends come and learn. Find out more go to our website, read the articles, watch more videos, kind of look in to see what the programming is, get the book, get the free ebook, all of that. Come and learn, friends. Come and learn.