Absence of inner motivation and unrealistic expectations
In this article, we will take a closer look at the very first, most common trading mistake that beginners traders do and you should definitely avoid.
Think about this: Is making money your one and only motivation why you want to do trading? Or maybe is it rather the case that making money could positively impact you and your family’s lives? Before going live, one should understand the primary motivation of why she/he wants to take this risky yet potentially enriching journey.
Let me share with you this story. I met a guy who, let’s say, didn’t end up well. He destroyed his family because of amateur nonsystematic trading. He had no critical thinking and risked too much.
What exactly happened? He was supposed to build a family house from savings. Unfortunately for him, he met a “trading guru” who would teach him a “miracle” trading strategy. But guess what, the strategy wasn’t miraculous at all, and he lost everything during a few months. The money that was supposed to enhance their living was with the slap of the fingers, gone.
He lost his wife and children’s trust because he told them he would make a fortune. Yet, he didn’t. He lost it all, including his family.
What did he wrong?
Firstly, he was greedy and had unrealistic expectations. Secondly, he didn’t have the real edge, and he traded a non-verified random strategy.
There is really a big difference between taking the risk while knowing what you are doing and between trading random, unsystematic “strategies”. And I hope you won’t make the same mistake, and our articles will help you avoid that.
So what’s the first step?
1. Create REalistic Trading Goals
This is one of the most underestimated trading rules, yet, it is one of the most important ones.
There is a saying: “The money is the only value you can afford to lose.” But I would add “extra money”. Because if you lose your extra money, it won’t threaten the quality of your life. And this is one of the critical things to understand if you want to succeed in trading. Otherwise, you will not follow the strategy and be consistent in hard times of inevitable drawdowns. You will be very vulnerable. Remember, trading is very hard with real money. Of course, it hurts when losing money, but you can deal with it if the main values in your life won’t be in danger.
Recently, one woman contacted me for advice: She wants to do trading because she is in debt, not in good shape. She tried to take out a loan, make money in trading, pay the debt, and start a new life. She asked me if that is a good idea. My advice was:” do not ever begin with trading unless your financial and life situation is solved.” There are no shortcuts. Not in life and neither in trading.
2. Understand the difference between joy and happiness
For the good quality of your life and, consequently, trading, it is necessary to distinguish between joy and happiness. And I do believe that understanding the real meaning of this distinction is a must. Happiness comes when you make your streak of winning trades. But then it goes away. It will not make you happy for the rest of your life. You might ask a question: “How do I have happiness on a day to day basis? “Well, you don’t. It is simply impossible. And honestly, I don’t think trading itself will make you happier. I believe that real fulfillment comes from your consistent hard work and learning. And systematic trading is a fantastic area where you can learn knowledge from different areas.
Moreover, it can teach you how to live in probabilities. You can learn better what has potential and what is better to leave. And this can improve your life. Personally, trading also helped me to:
- develop other businesses and improved my relationships with beloved people,
- control my greed better and become more generous.
It has set up my mind the correct way. The truth is that not all the things you will do in trading you will necessarily enjoy, but the question is, do you have a sense that you make progress as a human being? And this is the point: The trading will not make you happier if your only motivation is materialist and fugacious. Because when you focus on the journey, learning from mistakes, gaining new know-how and insights, the joy of fulfillment will come hand in hand with trading profits. You have to love trading as a scientific field, as an object to explore. You have to have a clear vision of what you want to reach, thanks to trading.
When I started studying trading, I had a clear inner motivation not to be employed and to feel the freedom of doing what I want and when I want. I didn’t think about making hundreds of thousands or millions of dollars. I was very sober and stayed on the ground, and that helped me the most, in the beginning, to keep on with trading. And fortunately, I reached my dream of financial freedom faster than I have ever expected. But it would never come without dedication and education.
A lot of cheap marketing created unrealistic expectations that trading is a fantastic adventure and an easy way to make huge money (it is possible with the systematic approach and the discipline). It is an adventure but with a lot of constraints and uncertainty. However, you can make it through when you start from the right end and end up very well.
In our next article, we will take a closer look at choosing the right market and how to…..