Controlling Your Emotions When Trading

Once you've been trading for a while, you'll realize that turning a mediocre trading career into something brilliant has more to do with understanding what's happening inside ourselves than with what's happening on Wall Street.  We can know all the right things to do, but if our emotions run amok, we will never be able to really trade with a solid sense of purpose and passion.  Instead, we find ourselves trading from a point of irrational emotion.  Digging into the problematic emotions that can hinder our trading careers is the only way to move to the next level.


Here's an example of exactly what I mean: While in college, I had the opportunity to learn about the stock market and how things "moved" in Wall Street.  This was also the dawn of mainstream online brokerages with flat-rate commissions.  So, excitedly I opened up a Webstreet account and funded it with savings earned while working my summer jobs.  I had created a simple strategy that looked great on paper and couldn't wait to get to the 9:30 AM opening bell to place my buy orders.

I came out of the gates on FIRE with several trades that I was sure would be BIG winners!

Several hours later, those trades turned into devastating losses.  Who could have known that Internet Incubator stocks were not so hot anymore after only a moment's notice?  This was certainly one of the worst feelings anyone could go through.  Months of labor and mediocre pay, all washed away in the juggernaut of the Wall Street money machine!

I took an entire week off to think things through, I decided after those devastating losses that it would not stop me from what I'm really passionate about and that is, trading.  I realized too, that I had a LOT to learn internally (psychology) as well as externally (market and economic data, technical and fundamental style of trading, etc...).

In the end, I realized that by taking a week off, I was taking a moment to recognize how stressed out I had become.  As a result, I used everything I've learned in those days to continue my work with CAM Trading.