Why Traders Fail Despite Motivation and Great Potential
Most traders fail because volatility triggers the brain's ancient fear response, causing emotional tilt and poor decisions. The speaker argues emotions are biological action potentials that can be retrained through diaphragmatic breathing and mindfulness, using four archetypal roles—Ruler, Warrior, Caregiver, Sage—to rewire how traders respond to market uncertainty.
Chapters
The trading gods must be crazy. Trading is an enormously excellent way of accumulating wealth because of the volatility. Okay. Without the volatility, the rapid growth of wealth and things like that wouldn't be able to happen. But the volatility, that up and down going on, that is where the money's at. So a lot of people go, you know, look, that's how you do it. That's how you do it. They get in, they learn how to trade and find out that there's something missing. They know how to trade, but they don't know how to deal with the volatility. But they don't see it that way. They just notice that they get tilted. They just get blown out of the water. And here's the second part, and this is where you really begin to see the gods must be crazy, is that in the same way that volatility is necessary for the development of wealth in trading, what happens is that your brain calls volatility uncertainty. And it is built exclusively for the last 6 to 8 million years as humanoids to avoid uncertainty, volatility at all costs. It will just avoid it. It will stay away from it. And if it can't avoid it, it will attack it as a threat because the volatility, the uncertainty is the kiss of death. So here's the joke. Yes, trading becomes an enormously powerful wealth-generation machine. Yet, at the same time, the brain that evolved so successfully for your survival, when brought into the trading arena, is not going to make it. Unless you just happen to have won the genetics lottery, the brain you brought, which avoids uncertainty, is pushed right in the face of uncertainty. The face of volatility. And then what you as the trader says, well, I just need to push myself into that and get used to it. I'll get used to it. No, this stuff has been hardwired for 6 to 8 million years as humanoids and for God knows how many millions of years before that as social mammalians. Do you think that instinctual urge to avoid uncertainty is going to back off just because you decide that you have an edge in the markets and you can push it and everything will be fine and you're going to generate wealth. No. So here's the joke. I give you— the trading gods give you this powerful avenue, but at the same time they make it impossible to really achieve it. How many people actually achieve consistent profitability on the level of wealth? From my experience, maybe 1.5% of the total population that trades. 5% may be in and around the break-even and making some money, but the vast majority of traders— and you know, we're talking about motivated, sharp people coming in and learning a system to be able to say, you know something, I can build an edge in my methodology that extracts more capital out of the markets than it puts back in. I can do that. The problem is Is the gods also gave me a brain that doesn't want to do that. It doesn't want to be anywhere near certainty. It wants certainty, not uncertainty. And yet at the same time, you think about it, it's so weird is that why wouldn't people see something so obvious? It happens every day. People blow up, people do this, they keep doing the same stupid thing over and over again expecting a different result. The truth is they have an ill-equipped brain for the work of trading, which is patience in the face of volatility. Okay, you're asking the brain to do something it's just not built to do. And there lies the question. Well, tell me something. I get it, Randy. I get it that you're saying that the brain It's not built to deal with the volatility, to deal with the uncertainty that is found in trading as a vehicle for capital enhancement. Yes. At the same time, can it be trained? And the answer to that is yes. You've got some limits, but the truth is, is that if you begin to say, you know something, Why am I ignoring my emotions so much when they're actually the key? Because if you begin to see emotions as not something pesky that you want to get away, but as the foundation of the mind that you bring into the moment. And what happens is right now you bring a brain, a mind into the moment of uncertainty with risk that is absolutely avoidant. It's going to react to fear. It's going to blow up. Or it's going to get really aggressive and do really dumb, stupid things. That's the way it was built to behave. And without it, we humans would have probably never survived. But with it, we have survived well. However, we're human beings. We're different than the rest of the social mammalians, the rest of the great apes of which we are one. But understand, we really— you really need to grasp We're great apes. Look at a chimpanzee, look at a gorilla, just start noticing. However, you as a human being have the ability of going in and rewiring the way you respond neurologically to uncertainty. You can train yourself with emotional regulation, and emotional regulation in its most basic form Came out of the yogic traditions of India 4,500 years ago. So it's not like this is new stuff. What those yogas were learning how to do was to use breath to maintain a certain calmness, to maintain a certain amount of revving up, but not too much. That's what they were doing. If you take a look tomorrow or in just a few minutes at yourself in front. Of a screen watching a trade either going against you or for you, you're going to notice that you stop breathing. You've just accelerated tilt. Okay? You're going to also notice that you carry tension in your shoulders and your neck, and you're going to also know your focus is like this: just in there. Those are symptoms of emotional arousal. The emotion has already triggered. It's gaining strength, and it's about to explode into. Into the brain and into the blood system in 0.003 seconds toward fight-flight. That's the instinctual brain that you brought to trading. That's what it's built to do. However, with training, you can teach— we teach diaphragmatic breathing so that as you engage the uncertainty with risk, what you're doing is you're breathing diaphragmatically, which automatically calms you down. High levels of arousal and diaphragmatic breathing do not mix. If you start the diaphragmatic breathing, it's going to slow down the emotion and you can get back emotional control. That's the first step we teach, because what we recognize is an emotion is a biological action potential. It's not psychological at all. It's built to— anytime something weird happens, any new change in the environment in your trading, And when it pops up automatically, an emotion pops up to greet it. It wants to be able to coordinate activity for short-term survival. And you can see the problem when your brain doesn't want to experience uncertainty, and yet you've got to be really good at working with volatility, uncertainty, to be able to make the wealth that's possible here. You see the glitch that has to be cured. Part of that, part of that is right there with the way you breathe. The second part is developing a practice of mindfulness of where you recognize something very powerful, that you and your thoughts, you and your beliefs are not one and the same. As a matter of fact, you do not have thoughts and beliefs. They're having you. They're causing your life. And what happens is you have stayed ignorant, emotionally ignorant. Of this power, and you're going to have to wake up and start saying, I need to start intelligently being able to use emotions to build the mind that engages the uncertainty. That's your ticket. To do so, what we do is we also teach how to pull up the discipline of a ruler, how to pull up the courage of a warrior, the self-compassion of a caregiver. And the clarity of mind of a sage. Those are the emotional elements needed to produce the mind that can deal with uncertainty and volatility. As you learn to do that and get proficient in it, you learn to— with us, what you're learning to do is to pull that mind up as you engage. You're not leaving it to chance about what mind's going to show up. Okay? This can be done, friends. My encouragement is go to my website, take a look at the resources that are there that can help you build that mind, because you are going to have to build that mind or you're going to have to continue deceiving yourself. But the trading gods, you make the wealth through the volatility. You, your brain doesn't like the volatility, so you have to train your brain To be able to accept that volatility and work with it. That's a good deal. It will produce not only a better trader in you, but it will produce self-mastery in other domains of your life. If not, take a look at more videos. Okay, we've got tons of them. And just begin to start recognizing that there is no sense in ignoring your emotional nature. It is going to be your friend or it's going to be your roadblock. I vote for friend. I vote for being able to build a mind, especially for the engagement of uncertainty. It can be done. I see it done all the time. The main thing— it's crazy— is to acknowledge that the emotions are already there. Okay. They're going to be with you whether or not you like it or not. Ignoring them, pushing them, stuffing them, denying them, it's just going to get— you're going to get hurt financially in particular. And yet what you're capable of doing is building that mind from incredibly empowered states of emotion and that mind and own that That's the whole point, is your mind is completely dependent upon your emotions. All thinking is emotional state dependent. So it behooves you to say, I need to learn how to use these emotions to produce this mind Randy's talking about. Yeah, so come and visit us. And what I would encourage you is that get some training. It's, it's not like it's going to go away and heal itself all by itself. You're going to have to move it. You're going to have to decide that you want to build the mind that can engage the uncertainty of volatility. Take a look, friends. Be well.
