As some of you will know, I have become deeply interested in trading the stock market via instruments like CFD’s and Spread Betting over the last couple of months. Whilst I am still achieving mixed results in terms of my overall profit and loss, one of the most challenging and interesting aspects of trading is the psychology. It is actually the hardest thing to master, and I believe this is true for most things in life. Holding your position on a trade that’s moving against you without giving in to your fear of losing money, or of diminishing any paper profits you might have made on that particular position, takes some serious self control.
I have engaged in trading courses, YouTube videos and books to help me improve on my knowledge of the stock market and how to trade with a consistently profitable system, but one of the books I’m listening to at the moment has really made me think. It’s a book on trading psychology, and aims to enable the reader to become their own trading coach. You can see more information about this book by clicking the following link:
I was listening on my way to Tae Kwon Do training last night, and a very poignant lesson caught my attention and made me think. When trading, as with most things we do in life, we tend to have a running commentary of self talk as we run through our day. That self talk can either be positive or negative depending on our mental state at the time. One thing that tends to be particularly debilitating is negative self talk. Whether you’re berating yourself for missing a turning when driving to work which could potentially make you late, or in the case of the book, have entered into a bad position which results in a losing trade. The observation the author makes in the book is that this self talk tends to be very harsh, and so he suggests the following exercise; pay attention to the self talk going on in your head – observe the mental tone, the language used and the things you are berating yourself for. Now, having observed this negative chatter in some detail, reframe. This is a simple exercise whereby you imagine that instead of saying those things to yourself, a friend or colleague is saying them to you.
For example, you might say something like the following to yourself having missed a crucial turn off to get you to work on time:
“I can’t believe I missed that turning, I’m such an idiot! I drive this way every day and I can’t even get that right! I’m going to be late for work now, and it’s all because I couldn’t even pay attention to my surroundings. I’m going to get in trouble for being late, and be behind on my work because of my stupidity. Nice one.”
Now, this may seem like perfectly normal self talk that occurs when you make a mistake in life, but I think we can all agree that this level of negativity, even in the form of self talk, is far from healthy; it puts us into a totally unresourceful state and we are only at our best when we are in a positive and resourceful state. However, now let’s reframe this situation and imagine that it is your friend who is in the car with you who is saying this to you:
“I can’t believe you missed the turn, you’re such an idiot! You drive this way every day and you still can’t get it right! You’re going to be late for work now and it’s all your fault because you aren’t even capable of paying attention to what’s going on around you. You’re going to be in so much trouble for being late, and you’ll be behind on your work because of your stupidity. Nice one.”
When you flip the roles like this, and imagine a friend or someone close to you saying to you the things you say to yourself, you would be disgusted with the way they had spoken to you and treated you. They’re supposed to be your friend, so why are they putting you down like that? So, the question is this; if you wouldn’t tolerate being spoken to or treated in that way by the people you know, then why do you tolerate it from yourself?
Truth be told, if you have good friends and surround yourself with good people who truly add value to your life, they would never treat you that way. You shouldn’t either! Instead, your friend or colleague would tell you not to worry about it, it was a simple and easy mistake to make and if you’re late you can just say you got stuck in an unexpected bout of traffic. Your boss won’t mind, he’s a decent person, and everyone makes mistakes. It’s early in the morning, and no one is at their best first thing. Don’t sweat it!
A big difference, as I’m sure you’ll agree. Which would you prefer to hear from your friends or colleagues? Decide now, that if that’s the standard you have set for how others treat you, then you should have the same standard for the way you treat yourself. Another way of looking at it would be to ask yourself what you would say to a friend in a similar situation to that which you find yourself, and that which triggered the negative self talk. Observe the differences between what you had been saying to yourself and what you would say to your friend in the same situation; then change your internal dialogue to match what you would say to your friend. There is no good reason to treat yourself worse than you treat those around you, so level the paying field and give yourself the respect you deserve.
Don’t be so hard on yourself! Try the exercise above the next time you face a challenge in your life and you notice your own negative self talk – engage in the role play, and ask yourself if you would accept or tolerate being treated or spoken to in that way by others. If the answer is no, then you shouldn’t be treating yourself that way either.
Everyone makes mistakes in life, it’s a big part of how we learn and grow, but instead of putting ourselves down when we do, we should instead be picking ourselves up, dusting off the dirt and refocusing with determination and positivity. Easier said than done – I know – but nothing worth having in life comes easy, and reframing like this will make a massive difference in your ability to face and deal with adversity in life.
Have a beautiful day everyone – be kind to yourselves, and give yourselves the credit you deserve in both the good times, and the challenging times.