This Is Why You Over Trade and/or Hesitate | Trading Psychology

Hello and welcome to lesson six of the advanced psychology course for high performance trading. This lesson is about trading frequency, which is a simplified way of saying overtrading and under trading. The problem of taking too many trades, perhaps impulsively, perhaps from a fear of missing out, or alternatively hesitating to pull the trader and endlessly sitting on the sidelines watching the market move without you. There's a lot to cover in this topic, so I'll start by stripping back to the fundamentals. Over and under trading are relative to the amount of opportunity in the markets. I know that sounds like common sense, but you'd be surprised at the confusion as to what too much or not enough trading really means. Your system is responsible for identifying opportunities in the market, but the amount of opportunity is is never consistent. Maybe the market is fracked and your method doesn't see opportunities in a flat market. Or maybe the market is too volatile for what your system recognizes as a valued safe opportunity. So the amount of opportunity is not something that's in your control. Your system doesn't create opportunity, it measures it. I've used the analogy before of trading being a bit like fishing. When you're fishing, you do not create an abundance of fish, nor do you control where those fish are. But you can learn where they might be or where they are more likely to be, and you can use tools to help you find them. The point is that the biggest mistake traders make with regards to over and under trading is to forget that they are both relative to fluctuating opportunity. It's not about trading at a consistent rate, because in simple terms, it's if the amount of trades you take remains consistent, like I've shown with this green line, you will be over and under trading. And the reason that's so easy to do is that consistent trading frequency feels like consistent trading behavior. Understandably, because we are looking for a rhythm or a work rate that's familiar. That's how we live our lives. Everything we do has a rhythm. How we eat, exercise, work, eat and sleep. So it's very easy to feel comfortable. We're taking a regular amount of trades in any given hour, day, week or month. But with trading, as you can see on this graph, with consistent trading frequency, we're overtrading when the oxygen, the market recedes, and we're under trading when the market is abundant with opportunity. When I talk about over and under trading, what I'm talking about is the extent to which your trading frequency is or or is not tracking real market opportunity. This is one of those things that is obvious and everyone accepts it at an intellectual level. But as always, what you know and how System One makes you behave are two entirely different things. If we were always able to follow our system rules correctly, without giving in to those maladaptive System One pushes, we would naturally track the opportunity in the market and always be trading at the right frequency, which would maximize our profits and and minimize our drawdown. Unfortunately, as you're well aware by now, even when your trading rules tell you there's a valid opportunity, sometimes you can be reluctant to enter. And other times when your system does not show a valid entry, you can be impatient and you can jump into a substandard trade. It all comes back to System One urges. The urge to trade when there's nothing there, and the urge not to trade when there is something, both of which seem absurd to outsiders. If following your system gives you the best results, why not just follow your system well? It's like saying, if you want to lose weight, just follow your diet plan. Easier said than done. Like all System One pushes, these urges are extraordinarily powerful and they have a head start in trying to influence our decision making. And every push that you get from System One always feels correct. To overcome the problem, you need more understanding of the mechanisms that are at work. Some awareness and some oversight. So, as with the previous lessons, I'm going to focus on the main causes. And with this there are seven. If you're following this course in sequence, you'll already be familiar with some of these, but we're looking at them now from a different angle, specifically for how they affect under and over trading. The repetition in some of these topics is deliberate, by the way, as this is how System one absorbs new knowledge to be able to learn and adapt. So the repetition is deliberate. Let's start in familiar territory with loss aversion. This primarily drives under trading the hesitation or reluctance to take opportunities that your trading system has identified. Now, if you remember, loss aversion simply describes the disproportionate amount of pain we feel for losses and compared to the pleasure that we would feel from an equivalent gain. We are motivated to avoid losses much more than we are motivated to chase gains. Great for survival, obviously maladaptive for trading. And it's important to realize this effect depends on whether you feel ahead or behind. We are risk seeking when we're ahead and risk averse when we're behind. Just like the sports team analogy that I always keep repeating. When teams are in the lead, they play it safe to protect their lead. So if you've had a good trading week or good trading month, you've been on a win streak and perhaps you've made new equity highs, loss aversion is going to be a major threat to you. You might get a valid entry Signal, but System 1 will focus on the potential pain of losing the games you've already made. It isn't interested in doing any lore, and it will Cleverly Recruit System 2 to provide some apparently logical and very believable reason why this trade should be avoided. So what can you do about it? Well, the first step is to be aware of when you are in a situation where loss aversion is going to be a threat. When you're ahead, you should anticipate that this is likely to be a problem. Like all behaviors, it's only really a problem if it's not anticipated. But if you know it's likely to strike when you do, then get that urge. You can recognize it and use System 2 to discount it and not let it dictate your actions. Remember, under trading is simply a powerful System one defense mechanism to protect those hard earned Danes. It prioritizes protecting what you have over continuing to make even fairer gains. And this can lead to hesitation, overthinking and perfectionism waiting for that 100% perfect setup to remove the doubt and find that elusive certainty that we all crave so much. Ironically, it is often the case that when traders reach new highs and they think they finally cracked it and have mastered trade in that loss aversion kicks in to protect their new profits and they go downhill from there. And because this is an unconscious mechanism, without awareness they don't realize what they're doing and instead they justify their hesitation by saying things like it just didn't feel right and they trying to attribute it to good intuition rather than what it really is. Now with all that said, it's important to point out that loss aversion is not always maladaptive or oversensive. It could be a reliable last line of defense. For example, traders in a consistent and long term drawdown may feel loss aversion intensely and this is a signal that they should deeply reflect and analyze whether their strategy, their skill, or even their understanding of the markets in general are really up to scratch. System one can literally save bad traders from themselves, so don't think it should always be ignored. That is why awareness is so important in the case of under trading. After a period of profitability, traders should recognize the urge but be prepared to override it. Whereas after a period of Excessive losses beyond normal drawdown. They should recognize it may be a valuable opportunity to pause trading and reassess what they are doing. A fear of loss is perfectly healthy and essential. It's a valuable advisor that should always be listened to. But it should never be allowed free rein to make decisions on your behalf. Deciding whether or not to enter a trade has nothing to do with how much money you have or have not accumulated, recent wins or losses, or how your equity curve looks. Okay, so loss aversion explains under trading when we're ahead. Now let's look at risk taking when we're behind. I talked about this extensively in the last video as it relates to cutting losses in individual trades. But it goes beyond open trade management. It can also have a stranglehold over our ability to enter new positions. Imagine this is your equity curve. Do you really think that the next trade entry that you're evaluating is not going to be influenced by this? Of course it is. Now obviously it could result in loss aversion, but we've just discussed that. So let's focus on how it might increase risk taking behavior when we're behind. System one encourages us to take bigger risks, and if we're not aware of this and anticipating it, the errors will creep in. And this usually translates as aggressively hunting down entries and an impatience in waiting for our normal entry conditions to be aligned. We'll hear things in our own internal dialogue like, wow, it's not perfect, but I've got a good feeling about it, or I haven't taken a trade in ages. Come on, just commit to something. That's when we throw away our system and we get into real trouble. It's very possible with an equity curve like this that the first initial dip started out as perfectly normal drawdown. But if the trader was unaware, System 1 would initiate the heightened risk taking mechanism which results in taking substandard trades, which compounds the losses, and then we're in real danger of entering a totally destructive cycle. It looks like this. It starts with a feeling that you've got less to lose. But of course, if you're in a normal period of drawdown, that feeling is false. But an untrained system, one thinks it owns and deserves all the money that it's made, including all the profit at the peaks of your equity curve. So for a beginner or an intermediate trader, they will immediately feel they've lost something. And remember, even small losses can can cause a disproportionate level of pain. So it wants to remove that pain and get back to the Equity high as soon as possible. And the longer the drawdown continues, the more likely it will feel that it has less to lose, which triggers a heightened risk appetite and loss aversion is replaced with risk seeking. And what makes matters worse is that System one has the power to override system two completely by flooding the body with cortisol and testosterone. And if you don't catch this early, you may not be able to catch it at all. That obviously translates into over trading. You're no longer trading from your system rules and you'll certainly be taking substandard trades and too many of them, which leads to more losing trades. So despite system One's best efforts to get you out of the hole because it's malefactive for trading, it inadvertently gets you into even more trouble. And you can see how a vicious feedback loop has now been created and your trading goes out of control and into a flat spin very quickly. So let's go back to prospect theory and look at what having nothing to lose looks like. If you're already in a loss, or at least that's how you perceive your position, then you can see there's not much more pain you can feel, whereas the potential for gain comes with a whole load of pleasure or dopamine, which is the chemical mechanism that draws us into this. One way of looking at what this is saying is that gains appear potentially infinite, but losses are not. So with less to lose and the possibility of infinite gains, that starts to look very attractive and risk aversion becomes risk seeking, which if not caught early and managed properly will, will inevitably begin the destructive cycle of risk taking in losses. And potentially it will end your account. All of this catches new traders off guard. They find a good trading system with an edge, they've back tested it, they've demo traded it successfully, then they go live and at some point they experience some amount of drawdown and they are totally unprepared for how system one is going to switch to a new risk taking mode. Why? Because it was dormant and not an issue when they were demo trading. Again, why? It's because it's relative to the risk that is involved in general or very small micro accounts, there really isn't much risk to X1, so it doesn't pay any attention. And because they've never experienced it before and no one has ever taught them about this before, they're totally unprepared and being capable of dealing with it when it does strike with real money. This is a topic that should be at the forefront of every single trading system and education course on the market. But you're lucky if it gets so much as a paragraph even with the most reputable educators that are out there, and I know why it's a hard thing to sell. Very few people are prepared to do what is really necessary to succeed. Psychology is not a popular thing in the trading market. Finally, here's something else that is essential for you to know. All of your sub selves have this heightened risk taking attitude when it's on the back foot. And risk taking in trading could be triggered by any one of them. What that means is your trading cannot be separated from the rest of your life. You can bring risk taking behaviors into your trading that have nothing whatsoever to do with your equity curve or your trading results. If you've recently lost your job or otherwise experienced harm to your status, then you have less to lose and potentially everything to gain by taking more risks. That's translated into trading. If the sub self for attracting or keeping a mate feels threatened, there's every likelihood you will engage in excessive risk taking when you sit down to trade. The same goes for things like prolonged illness, either for yourself or for a member of your family. The threat VAT poses can trigger risk taking when you trade. All of these sub selves are part of the same system one so you have to be aware of this and pay close attention so you can preempt this behavior and catch it before it takes control. None of this is an insurmountable problem, so don't worry. It just requires that you are more alert to the danger and you're ready to catch the oversensitive maladaptive behavior before you hit the buy or sell buttons. And you'll get plenty of help doing this as the course progresses. Okay, now let's move on to a really important factor for over trading. The work equals results fallacy. I've talked about this in a previous video, so the concept is somewhat familiar too. But this is how it works in relation to overtrading. Remember that our ancestors lived in a very physical environment doing relatively simple, repetitive tasks. We are not very well adapted to purely cognitive tasks such as trading. System one without oversight will assume that if it's not getting the results it wants, or conversely is getting the results it wants, but it wants more of them. It will simply take the view that it needs to do more of the task and work harder. So after a losing streak, it will simply say you're not doing enough work harder to get yourself out of this hole. After a winning streak, it'll say great do more of what you're doing and you'll get even better results. In very basic terms, System one mistakes trading as being the same as physical tasks and assumes that results are proportionate to the work done. More trades equal more profits. This is an especially pervasive problem for traders because it's not only being driven by the subconscious. System one, deep down from our past, we see this every single day of our current lives. So System two is fully on board with this concept. Every single job or activity you've ever done, the results were proportionate to the work done. The more you put in, the more you get out. Trading is uniquely different in that less is more. It's a phenomenally difficult concept to get our heads around. Taking only one trade will often make more money than taking 10. And you get paid for sitting down and doing nothing. Try that in any other profession. And so awareness is once again critical. If you're not routinely asking yourself whether your need or urge to get into a trade is due to the fact that part of you is equating results with work done, then you can't be sure you're not a victim of this problem. As I said, you will only get answers to the questions that you ask yourself routinely. Now the next topic is the illusion of control and our tendency to believe that we are influencing things that are actually beyond our control. I'm not talking about believing we control the market as such. I think we all accept that our accounts are not large enough to move price. But what we are all vulnerable to is believing we have some control over outcomes. The phenomenon was first known by psychologist who defines it as the belief that we can influence the outcome of uncontrollable events. And we're particularly prone to this on after a sustained period of good performance. It's actually been studied most carefully with gamblers, but the research has included institutional traders as well. Sociologists notice that gamblers display subtle subconscious signs that they think they are influencing the outcome of random games. For instance, craps players at all experienced levels tend to throw dice softly when trying to roll small numbers, and they throw it hard for high numbers. And they're reluctant to place bets when somebody else is thrown the dice rather than them. And we now know that when people are faced with random or probabilistic outcomes, we all have a tendency to downplay the element of charms and believe we have more skill and control than we really do. Casinos and designers of gambling machines are very well aware of this, and they deliberately design games to exploit it. For instance, slot machines do their best to convince you that the outcome is under your control. By giving you tasks to do, such as matching things up, lining them up, pattern spotting, and to give you actually completely useless information that you might draw on to make false calculations of probability, it deliberately deceives and distracts system one. As long as we're busy doing something, we think we're getting better at these irrelevant tasks and that somehow we we can increase the control we have over winning, which of course we can't. Now, we might be able to accept this as an illusion gamblers would fall for, but surely traders don't, right? Well, the London Business School and Oxford University together did a study looking at experienced institutional traders and they found it was just as prevalent with them. And interestingly, those traders who had higher levels of an illusion of control performed poorly at analysis. They had bad risk management habits and they were the least profitable in the long run compared to traders with lower levels of the illusion. As you might expect, behavioral economists describe this as irrational thinking. However, like everything else we've been discussing, there are often very rational reasons as to why we do this. When it comes to overall mental well being, an illusion of control is seen by researchers as very much a healthy thing to have. Believing one has an inflated ability to control one's own future gives us a sense of responsibility for what is happening to us and comfort from feeling that we do have some control. The self help industry is built around encouraging disillusion and it's not necessarily a bad thing. People who lack this way of thinking and perhaps are more inclined to think purely rationally and accept the high degree of luck in the world, are much more likely to feel they can't control what's happening to them, they can't improve their situation, and they are really vulnerable to feeling helpless and suffer from depression. Through all of our history, the illusion of control has been critical to our success by motivating us to be proactive rather than passive. In almost every culture in history, there are countless examples of illusions of control over random events or events outside our control, like like rain dances and various sacrifices to different gods. These are all methods to try and increase our level of certainty in a very unpredictable world. But our understanding of cause and effect is tenuous to say the least. In trading, we can easily slip into a way of thinking that we are creating or controlling the opportunity. Using the sailing metaphor, what you have control over is your skill in navigation, operating the sails, understanding weather patterns, understanding sea states and tidal patterns, and knowing yourself enough to have good judgment and make Good decisions. What you cannot control is the weather itself. In saving terms, an illusion of control would be if you started to think that good weather was the result of your good planning, your experience, your skill, or even because of a lucky charm that you brought along with you. In this metaphor, the market is like the weather and there's nothing you can do to affect it in any way. Your skill as a trader is to understand probability, conduct good analysis, follow your own plan and understand yourself. Essentially, follow the market and do your best with the conditions. It presents, the amount of opportunities and the profit that you can pull from the market and depends entirely on the conditions. And that's an important point. If traders start to believe that their trading system is responsible for creating opportunities, they are highly likely to over trade when the conditions are poor. Slow market conditions can lead to impatience. This is also what can lead to system hopping. The illusion that your system is not creating enough opportunity. So you go looking for another system that, that will be very alert for this happening. After a period of active markets and lots of opportunity, we get used to the good conditions and we believe we are somehow influencing and responsible for the positive outcomes that we're experiencing. Then when the market slows down, we fail to adapt. We try to continue doing what we were doing before, and that then results in overtrading. Of course, what we should do is, is accept that the weather has changed, the market has slowed down, and there are now fewer opportunities. This is exactly what happens in market bubbles like the dot com boom. The weather was fantastic and profitable. Opportunities were almost endless. And after a while, even the best traders in the world became convinced they were making money hand over fist because of the assistance rather than because of the conditions. And when the evidence started appearing that the conditions had changed and the party was over, they ignored it. They believed their systems were responsible for the profits and they would continue to make them. They were wrong. Long Term Capital Management is one of the most famous examples of this. With Nobel Prize winners and some of the smartest mathematicians and statisticians on the planet on their team, they believed they created the perfect trading algorithm. And for four years straight, in awesome market conditions, they made massive returns. And then the market changed and it slowed down. But they ignored the evidence and they stubbornly clung to the illusion their system was infallible and would continue to create opportunities and therefore profit, no matter what. Because they were geniuses and they were controlling the outcome. That didn't happen and they lost everything. They nearly took out the entire global economy with them. So don't Think this is something only amateur retail traders suffer from. It affects everyone and it takes a very self awareness, honest person to be open to this possibility and then take the steps to safeguard themselves against it. Now, if we're going to talk about under and over trading, we've got to take another look at mental accounting. You're already aware of how this can affect your decisions around managing and closing positions, but now I'll quickly explore into your how it can push you into substandard entries. Remember, we all keep mental accounts automatically and they always feel highly intuitive and convincing, which means we follow them without question. And as well as keeping track of wins, losses and profits, such as we discussed in the last two lessons, you will also very likely keep track of how many trades you've taken in a day, week or month. In other words, your trade frequency. When you do that, it will exert a lot of pressure on you to over trade when the market conditions go flat and your normal strategy identifies future fewer opportunities, or under trade when the market picks up and there are more opportunities than normal. That makes sense. Obviously, if your mental accounts have concluded that you normally take X number of trades in a given period, if you're below that tally, it will encourage you to take more. And if you're over that tally, it will encourage you to trade less. But of course these mental accounts have nothing to do with the conditions of the market. Your trade frequency is governed by market conditions, not the arbitrary number of trades that you've taken. Like every other system, one mechanism, you can't turn this off, but known about it and expecting its influence, you can ask the right questions like where is this urge to trade or reluctance to trade coming from? And recognizing it as related to mental accounting, you can then discount the urge. Okay, now in the last lesson on cutting losses, we looked at the sunk cost fallacy in the context of managing a single trade. But it goes way beyond individual trades. The sunk costs I'm going to talk about now are usually much more relevant to traders and can be a primary driver behind over trading. Trading requires you invest money setting yourself up before you even take your first trade. You might have bought a brand new computer or upgraded your existing one with more powerful graphics cards to accommodate more screens. You'll probably pay in monthly for the best Internet connection that you can get. You've definitely paid out repeatedly for trading education, some of which has been okay, some of which has been a complete waste of time. Your trading system has very likely cost you money to buy indicators, books and manuals, and just the Time and effort that you've sunk into this has most definitely been considerable. Arguably, the time you've invested exceeds any other dollar amount. And of course, there are lots of other types of pain and sacrifices that you've endured to get to this point. Getting up early, sacrificing a social life, trying to keep others in your family on side, whilst you attempt to become consistent and profitable. Despite their skepticism, a person in this picture has even gone out and sunk what looks like about $5,000 on a chair. All of these costs add up and it's highly likely that you're very aware of them on many levels. But they are sunk costs, and short of putting that chair on ebay, the costs are irreversible. Now, you might think that you accept all of this as the cost of starting your trading business, but System one has a tendency to constantly remind you of the sunk costs and sunk sacrifices, and it will forcibly motivate you to get a fair exchange and see some return for those costs. And this is the problem. Particularly when the market is flat and there's not much opportunity, System one will see you sitting in that expensive chair, not taking any trades or taking less than you've done recently, and it will start to demand that you get fair exchange for your sunk costs. Suddenly, doing nothing, making no profit from the comfort of your five grand chair, becomes very uncomfortable. Perhaps a more realist example might be that you've just paid $500 for an indicator and the following day you want to see some results from it, putting pressure on you to trade regardless of if there's a valid opportunity or not. That's the sunk cost fallacy. Especially in slow market, it will pressurize you to find something, anything to start recovering some of those costs. And when you do that, by definition, you are over trading. Okay, so the final factor is the present bias. This is the simplest explanation of them all. It's our new logical and our biological preference for something small now over something much bigger at some point in the future. A lot of the previous factors can be quite complex and subtle, but for a lot of traders, overtrading is simply down to the fact that we would prefer to take a poor trade now than wait for a great trade at some unknown point in the future. In the previous lesson on letting winners run, I explained that our motivation to acquire anything is governed by the amount on offer. And when it's offer. If $10 or $100 is on offer now, then you take the hundred dollars, obviously. But if the offer of $100 is pushed further and further into the Future, then the $10 becomes more and more attractive until the hundred dollars is so small so far into the future that we happily accept a 90% reduction to have it now. Well, the same effect is of course working against us. In a flat market, we may know that the opportunities present are substandard. But when there's no way of knowing how far into the future the market will pick up, the promise of bigger profits at some point in the distance is not as attractive as a small profit. Right now, overtrading is simply the fact that you're unwilling to wait. We've evolved to prioritize present gains over future gains, even if the future gains are likely to be much, much more significant. But most children will opt for one marshmallow now rather than three in an hour. And the further into the future the three are promised, the more children opt for one now. So in trading, especially in flat markets, the question is whether you'll urge to trade stems from this present bias mechanism. If you're not looking for it, you're not aware of it, then you'll find all kinds of false reasons as to why a trade looks good, even though your trading system does not identify it as valid. Okay, now, whilst every trader knows that over and under trading is a potential problem, the simple labels that we give those problems hide a fair amount of complexity in that there are a few contributors that can all interact. Simply trying not to over or under trade is almost meaningless without some awareness of what is going on. Once you've become aware of the various mechanisms, it is much easier to to discount them from your decision making process. Now we're letting winners run and cutting losses. The question that we need to ask ourselves are generally act near the decision point. I mean at the point in the trade that we feel the urge to close early or move the stop loss. In a sense, it's reasonably easy because we can almost use a checklist as we're managing the trade. But with over and under trading, we're developing a much more continuous awareness. The urge to trade, despite having no valid signal from our system or a reluctance to trade, even when a system tells us we do have an opportunity, is not always at a specific decision point. The things we cover today should really become part of our general awareness when looking for any opportunities in the market. At any point you begin to deviate from your trading plan in any way at all is when you need to question what's really driving that deviation. The critical issue here is timing. The earlier you notice any of These mechanisms coming into your decision making, the better chance you have of discounting them and getting back on track. If you don't catch it early, there is a point of no return. So what I want to talk about now is decision momentum. Let's use a simple metaphor and represent one of these maladactive system 1 mechanisms. And as a boulder on top of a hill, all System 1 mechanisms are pre conscious. So they've started to influence our decision making before we or system 2 gets to know about it. So they have a head start, a small amount of momentum if you like, and the boulder has started to roll, but it's only small to begin with, like the boulder beginning to roll on the flat. If you become aware of it early enough and you identify it as a maladaptive mechanism, then it's relatively easy to halt it and stop it from rolling on. But if you're not aware and you don't notice the early signs early enough in your decision making process, then inevitably there's a point at which it becomes very hard, even impossible, to stop it going all of the way. And even if you become aware of it now, it's built up so much speed we're going to go along with it anyway. You'll hear yourself saying something like, I know this isn't part of my system, but here are some false logical reasons to why I'm going it anyway. It's crucial that you see decision making as having some kind of building momentum. If you were to ask me why most retail traders are not successful, I would say you're looking at it right now. The point at which they realize they're about to deviate from the trading system is the point of no return. They have no awareness of the contributing factors behind their maladaptive trading behavior and no way of halting it before it becomes unstoppable. I'll give you a non trading example. Going to the supermarket. If you are not asking yourself whether you're hungry before you go shopping, and you only notice when you come face to face with a bakery tanker, the need to eat something, anything, will have got so much lamenton that you are far more likely to say, I know I didn't come here for donuts, but hey, they look so good. Okay, just this once. You haven't anticipated, you haven't noticed the hunger build in the background, and you only became aware of the urge at the decision point, which is too late, or the amount of willpower required at this point would be immense and exhausting. Don't forget that the willpower needed for overriding system 1 is a limited daily resource. Once you're out, you're out of it until you sleep and refuel. The good news is that you are now equipped to start catching these things early. And you do that by first understanding what the most maladaptive mechanisms are, which is what we've done in this video. And then start to observe yourself and look out for the early signs that are creeping into your thinking. It still takes effort to roll these things back, but the earlier you notice them, the less effort it is to roll it back. Okay, so let's go back to the oversight diagram. We're trying to gain oversight of the urge to trade or the reluctance to trade even though our trading system is telling us otherwise. Is a reluctance simply a fear of losing well earned profits? Can you notice System One's unequal fear of losses over potential gains? Or are you overtrading because you've got a heightened risk appetite? Are you in a situation where on some level you feel you have less to lose? Make sure you're on the lookout for that cycle of risk taking that I mentioned. Is something telling you that if you did more, you would get more results? Maybe you started to think that you're responsible for recent successes and that your system is beating the market and creating opportunity and you found the secret key to profits? Or is there some kind of mental account that you're trying to balance? The need to make up for a poor week, for example? Or is System one gently reminding you of the sunk costs in your trading? Is there an urge to see some payback for the effort you've put in? Or is it simply that System one wants a quick, small reward now rather than something later? Have you become impatient and you're in need of some kind of dopamine hit? Remember that a lot of these mechanisms start as physical sensations in the early part of their normentum. You won't always know exactly what they mean, but if you continue to ask yourself the right questions and you will get better and better answers, and you will catch these things earlier and earlier with less and less effort. Okay, so there's the summary slide for this lesson. As always, if you want to pause the video and take some notes. Now, the next two videos are what I consider the most important in all of trading probabilities. I'm dedicating two separate lessons to this topic because this is the define element that separates trading from every other profession. And without a thorough understanding of probabilistic thinking, I personally don't think it is possible to ever succeed as a trader. So make sure you jump in and watch that as soon as you can. You definitely don't want to miss it. Thank you, and I'll see you there.