Using Mindfulness to Develop an Edge in Your Trading Psychology

When you finally come to the moment, you recognize that no matter how great your brain is, how wonderful it served you. When you take that brain and move it to trading, it's going to produce a disaster. You have to recognize that there's nothing wrong with the brain. It was developed to be able to produce certainty, control, environment. And yet how good it was there is, how bad it is is in trading. And we have to start learning how do we begin to observe this? How do we begin to change the brain from working on certainty to working in probability? The answer is mindfulness. And what you do is you begin to go, you know something, how, how could I use mindfulness? And what is mindfulness and how do I use it to be able to build brain and a mind that's built for probability, for engaging probability. It's a big deal because as long as you have a reactive emotional brain, you are going to have to understand that that brain is designed to, when it encounters uncertainty, to feel vulnerability and then a direct wire into fight flight. That's what happens to most traders. What we need to do is learn how do we go about rewiring that brain, that mind, so that when it engages uncertainty, it moves to concern, not fear or anxiety. And it also moves to a sense of alertness and readiness, but not into the action of fight flight. The answer is in mindfulness. First, what is mindfulness really? You know, it's a word everybody hears these days. But what does it really mean? Well, look at it this way friends. If you started noticing what you notice, you would actually be producing mindfulness. It's a big deal. I'm going to talk about that a little later. Or you could also say that mindfulness is bringing awareness, becoming aware of, of what's going on right in front of your eyes, which by the way, a lot of traders don't do. If we take this concept and say, well, how would I go about developing mindfulness? The first thing understand there's three stages of mindfulness that need to be developed for trading. The first is you need to become mindful. You need to become an observer of the biology of your emotion. You can, you know, the thing is most traders have no clue that they are absolutely jump starting emotions and they're setting up hijacking and they don't even see that, they just end that hijack. Yet if you were observing, really started watching your body, you'd see the telltale signs, you would see the arousal of the emotion in the way that you've altered your breathing. Instead of a diaphragmatic slow breathing. You would have been halting your breath. You would have been holding your breath. You would have been just breathing with the very top part of your lung. You would literally have been signaling the brain to go to fight flight. Because ultimately, fear has a signature, Anger has a signature, impulse has a signature, and part of that is breathing. As you become aware of that, you go, oh, my God, I'm seeing myself breathing in such a way to add gasoline to the fire. Yeah, you want to alter the breathing, but you have to observe your breathing and become kind of like a student of your breathing and watching it. The second is muscle tension. You can observe the clenched jaw. You can observe the tense shoulders. That's emotional arousal. So on one area, what you're doing is you're using observation to observe the body. That's first order observation. Okay, Necessary. It helps you to be able to regulate emotion so it doesn't sweep you away so that you can keep that calmness without just triggering to fight flight. But there's more than that. This next level is you begin to recognize mindfulness and observer work is that you and your thoughts are not the same. Whoa. As a matter of fact, you're not having thoughts. They're having you.

When you start trading, you start noticing conversations in your head. If you're smart, you start saying, I need to observe these conversations. I was talking to a guy today. He says, randy, I was sitting there trading, and as I got in there and it finally got into the black, there was a voice in there says, take that profit. Take that profit. Then he said, you know, there was this manager part of me that says, no, this is a perfectly fine trade. It's following the rules. We need to let this thing go. Suddenly, what he discovered is a debate. But he had become observer to that debate rather than just letting it wash through him and take over him. So there's the second one. You become observer to your thought life and recognize that you and your thoughts are not the same. As a matter of fact, your thoughts are coming forward from emotional programs that you need to become observer of. The organization of mind that you bring to trading needs to be intentional. It doesn't need to be the one that you came to trading with. The third part of observation and mindfulness is when you start observing the beliefs that drive your performances. Friends, this is powerful. This is more subtle. And we're not talking about the beliefs that you say you have. We're talking about the beliefs that you find in your performances. And the only part that really matters here is what your trading account is telling you. The assumption is that if you have effective beliefs that you're projecting onto the markets, you're going to see growth. In your trading account, if you have ineffective beliefs that drive your performances, you're going to see stagnation or losses. That's the whole point. But then you're going, okay, I see that I need to start observing my beliefs not as who I say I am, but as the performance I'm doing. And this becomes the critical, powerful part is you need to become observer of the conversations that you have about being a winner. Okay? Most people see winning as controlling outcome, of conquering, of making things happen. That kind of mind has no business in trading. You cannot control outcome in trading. You can control the beliefs, the emotions you bring to create mind that engages uncertainty. That's the power. And as you get, if you get to that point, what you realize is that I can observe the beliefs. They're not me. You and your beliefs aren't the same. They're not me. What happens is you recognize, oh, this is one potential organization of itself. And what you realize is that you can go in, reorganize the belief system that shows performance gains in your trading account. That's how you use mindfulness friends. And you know as you learn this, you're going to discover that this is a process that you need to self develop.

We invite you to our website to start really looking and seeing how, how you can develop the mind, develop the brain from certainty thinking to probability based thinking. It is the edge that you've been looking for. Take care.