Not only do I hate to lose, but losing is like kryptonite to my trading. Let me explain. One of the effects of ADD is a lack of focus, and at times, exaggerated thinking. Today I took three trades and lost on two of them, and immediately I began to think in catastrophic terms. “Oh my God”, I thought, “what if my winning trades have just been luck up until now?” “What if I can’t find anymore winning trades?” ” I am going to burn though my funds in six months and have to get a job as a rodeo clown!” Etc., etc., etc……….!
My ADD and my “need” to be right are very powerful, and because I had two losses in a row, I wanted to immediately erase those losses, by winning. The problem is, the market doesn’t care what I want, and if there are not any good set ups left, I will be tempted to force a trade. If that trade fails as well (as the odds favor), then it is free-fall time, and I can do some serious damage to my portfolio. But, I do have a defense against this process, and it is called…..A METHODOLOGY…!!!!
See, prior to starting this blog, I had no methodology (see my profile section). I had good reason to freak out when a trade went bad, because I had no concrete way to find a good trade again, and more importantly, one where the odds were in my favor. It WAS luck usually when a trade went my way, and perhaps in the back of my mind I knew. But now when a trade doesn’t go my way, I can review it, and find out why it was a loser. And on the winners, I can look to repeat the steps that got me into and out of the trade. The problem is, my mind hasn’t completely accepted that there is a new method (or any method for that matter), because if it had, I would not still be tempted to freak out when a trade goes bad. It is like when you lose a limb, you mind is so used to having it, that patients swear that they can still feel it, sometimes don’t even believing the limb is gone til they actually see it is missing. This is what I have to do. Remind myself that the old ways are gone, that there is a new and robust method, that even this method will have losers, and to resist the temptation to act as I did before this new methodology, and not do undue damage to my account. By the way……….I like to say “methodology!”
