A trader explains how four limiting beliefs—inadequacy, needing to matter, unworthiness, and powerlessness—sabotage consistent profitability. The fix: stop trying to be right about every trade and start managing probability instead. Reorganizing these beliefs lets you trade with patience and discipline.
Welcome to Hong Kong. Right now there's a typhoon outside, so we're going to be inside for this. What I want to talk about is consistency. A lot of people, a lot of traders know how to trade. They put in the hours, they put in the time and they're sure they can. When they're in simulation, they can consistently make good profits and they can see how they can take this to the next level. Yet when they go live, all of a sudden the consistency is gone. They'll be there, they'll have the right mind and then all of a sudden out of nowhere, wham. Their mind just gets hijacked and suddenly they're no longer able to produce the same kind of consistency that they had at one time. Or they may be streaky where they get it together and everything's good. What causes this? Okay, well in trading for me, and the way I teach is there's one basic assumption that I ask to take as truth as the assumption I'm going to build on. And that assumption is this, is that the health of your trading account is in fact a reflection of the beliefs that you are projecting onto the markets. And in particular it's the beliefs that you have about the way you can manage uncertainty. Most of us really try to manage uncertainty by avoiding it, by trying to be right. A trader is no longer trying to be right, they're managing probability. And it really comes down to the brain building a mind that is trying not to make a mistake, trying to predict the future rather than to be in the moment of probability.
When that happens, everything goes well. The problem is most people are trying to not lose. And in doing that they get into situations and suddenly everything blows up. This is the piece where trying to predict what's going to happen doesn't work. And you get that that assumption lies at the heart of it. At the bottom of that assumption are going to be four self loaning beliefs that drive the lack of being able to trade in the moment, trade in the clutch.
The first one is on a deep side and a deep sense of. And this is something where you probably won't even see it up front. When I can't be wrong, I have to be right. Underneath that is a sense of being inadequate. If you sit there, I have to be perfect, I can't make a mistake. It's the inadequacy. Because the inadequacy is a way of saying I don't want to experience uncertainty. You know, I'll do anything, just not that. That's the first belief. The second Belief is the sense of not mattering. And what you'll see in trading is that I want to make a bunch of money so that I can show people I matter. Look at me, I've got it together. If you're trading to make money, you're going to have a problem. Because the secret of trading is to trade to perform well, not to make money at that moment in time. Making money is a byproduct of the mind that you bring to the performance of trading. Okay, but if you're already hooked into to matter, I have to make a lot of money. You're already on the downside. The third one is sense of worth. Believe it or not, a lot of people will actually believe that they don't deserve to win big and not to work hard for their money. They have to work hard. You'll see this by people the moment that the charts show up. They have an urgency to trade. No, if the urgency to trade is there, this sense of unworthiness, proving myself, I have to be busy to be worthy. I have to earn my money. Nothing could be further from the truth in trading. It's really about non urgency. It's about patience rather than busyness that the really great traders have. The fourth one is a sense of powerlessness. If you have ever felt as though just everything has gone just to hell in a hand basket, you're engulfed and you're powerless and you're just being overwhelmed. You know, powerlessness that occurs most often when you're managing a trade and it starts going sideways. It starts really just moving around in its range. And what you say is, you have this thing, it's going against me. No, it's not.
It's working within its range. You have targets, you have stops. If it doesn't hit the target, if it hits and goes against you, what it's really doing is it's going to the bottom of its range and stopping you out. It's a loss of probability. It's not against you, it's a loss of probability. And the key is if you can go and say, I would do this again, the trade hadn't gone against you, you just were on the wrong side of probability. These are the four beliefs, inadequacy, mattering, worth and powerlessness, that are behind the lack of consistency and consistent trading for profitability. You start getting at these. And this is where the probability of consistency takes over. This is where you start. And these are the ones that you have to really man up to. You have to really acknowledge, you know, underneath all of it. You know, I've been. I need to come out into self honesty and recognize these four beliefs. At least one of them are at the core of my consistency problems. When you do that, you begin to consistently win. You begin to realize that your belief systems are in fact fluid and that you can reorganize the belief system to be able to produce higher levels of performance in the clutch. That's where you become a consistent trader.
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