Article Categories
» Arts & Entertainment
» Automotive
» Business
» Careers & Jobs
» Education & Reference
» Finance
» Food & Drink
» Health & Fitness
» Home & Family
» Internet & Online Businesses
» Miscellaneous
» Self Improvement
» Shopping
» Society & News
» Sports & Recreation
» Technology
» Travel & Leisure
» Writing & Speaking

  Listed Article

  Category: Articles » Finance » Stock Market » Article
 

Do You Know What is the Single MOST Critical Mistake in Trading the Stock Market…?




By David Chandler

Well maybe that's overstating it a little, but it's certainly one of the
most important.

It is¡­(drum roll please)¡­ ¡°the need to be right¡±!

Now that probably wasn't what you were expecting. You might
have thought it was going to be something like not picking the
trend or putting too much money on a single trade or one of a
dozen other things.

But I can assure you, from bitter experience, that this one attitude
causes more problems than most other things you might do as a
trader. And it's worse for men! Something to do with ego or
testosterone¡­

You see our whole society is based on the importance of being
right. The need to be right.

Your parents rewarded you when you are right and told you off
when you were ¡°wrong¡±. They probably still do this now that you
are grown up!

From your earliest days at school you are taught that being right is
the most important thing. Isn't that what tests teach you? And
this is reinforced through the rest of your life. Your boss probably
reminds you of this just about every day!

But some of the best things occur when we aren't right. Like the
time you take a wrong turn. Either in your travels or in your life.
And you end up at this amazing place or with this amazing person
that you never would have, had you done the ¡°right¡± thing.

Plus there's not a lot of point beating yourself up when you aren't
¡°right¡±. Because, as we all know, it's going to happen pretty
regularly!

Coming from Australia, I don't know a lot about baseball. But I do
understand that batters get paid a lot of money to miss hit the ball
an awful lot! Think about that. Top baseballers step up to the
plate every day knowing that they are more than likely not going
to get it ¡°right¡±. Yet they are confident and successful because
they know that over a season they are going to get it right often
enough.

Don't Beat Yourself Up or the Market Will join In!

I went to a speed-reading course many years ago. I didn't learn
how to read faster (!) but I did learn an attitude that has stuck
with me ever since. It is - ¡°Focus. No attachment to the outcome.¡±

This guy was telling us about how he taught elite sportsmen to
achieve their best (hope he was better at that than teaching
people how to read fast!). He explained that the trick was to get
them to keep taking the shot (or making the jump or whatever)
without getting upset with themselves if they got it wrong.

The key was for them to focus on what they had to do in that
moment, not on the outcome.

Maybe I have lost you? But the point I'm trying to make is that you
need to go into each of your trades with your focus - not on being
right - but on following your trading system.

And then the key is to not beat yourself up if you ¡°get it wrong¡±.
Because if you have followed your system and you know the
system works over time, you have done the ¡°right¡± thing.

Once you have confidence in your trading method your only focus
is on following the signals.

¡°Focus. No attachment to the outcome.¡±

By the way, try this approach in other areas of your life. It really
works! My golf was much better once I stopped getting angry at
myself for every lousy shot.

Deadly Attitude in the Market

In the stock market you can't afford to hold onto the need to be
¡°right¡±!

When trading, you cannot be right 100% of the time. In fact, you
can be right only 50% of the time and still make lots of money. But
this means you have to be wrong an awful lot!

The market will do what the market will do - no matter what your
opinion might be. If you are holding a stock and you expect it to
go up in price but it starts to go down, what happens?

If you are like me, a little voice inside says something like ¡°¡­but
this wasn't meant to happen!¡­it can't do this to me!¡­ I know I'm
right - it's just a temporary set back; it will come right, I'll just wait
it out¡­

This ¡°voice of reason¡± is your ego. You can't bear to be wrong, so
you justify your decision to yourself. You must be right! You tell
yourself that you know what's going to happen¡­the market's just
confused¡­it's just got it wrong! (totally illogical reasoning - the
market can never be ¡°wrong¡± - but it makes sense at the time!).

This deep-seated, primordial need that we have to be right can
destroy you in the stock market. It will make you put too much
money on one trade. And it will make you hold onto stocks that
you should have sold days or even weeks ago.

It will mean you will miss opportunities you should have taken
because your view was the opposite of what actually happens.
And you can miss getting extra profits from a trade because you
were convinced that ¡°¡­it couldn't possibly go any higher¡­¡±

By being aware of this ¡°need¡± you can overcome it - over time!
You need to get to the point where you ¡°want what the market
wants¡±. Not what you want.

Just remember.

¡°Focus. No attachment to the outcome.¡±


The above comments are offered for educational purposes only.
We are not providing you with financial advice. We are simply
sharing with you what has and hasn't worked for us personally. If
you wish to trade or invest in the stock market you should obtain
advice from a registered licensed advisor.
 
 
About the Author
David Chandler
http://www.stockmarketgenie.com
For your FREE Stock Market Trading Mini Course:
"What The Wall Street Hot Shots Won't Tell You!" go to: http://www.stockmarketgenie.com

Article Source: http://www.simplysearch4it.com/article/6450.html
 
If you wish to add the above article to your website or newsletters then please include the "Article Source: http://www.simplysearch4it.com/article/6450.html" as shown above and make it hyperlinked.



  Some other articles by David Chandler
Defensive Driving -A Way of Life
Annually, more than 40,000 people lose their life in automobile accidents each year. Another two million suffer disabling injuries. These startling statistics are from the National Safety Council. The ...

Costa Rica - Your Place in the Sun
In Central America, just south of Nicaragua and north of Panama is Costa Rica. Costa Rica has the Caribbean Sea to the east ...

Dollar Saving Tips on your Next Car Rental
One of the biggest vacation expenses is a rental car. Below are a few suggestions on how you can save money on your next rental car. If you ...

Recreational Vehicle (RV) Sales on the Rise
As the baby boomers retire, the recreational vehicle industry has seen an upsurge in sales. For many people, nothing measures up to the independence and flexibility of enjoying the open road ...

Combating Viruses with Security Software
Help, I was sitting in front my computer and it starting acting strange! Pop-ups were on my screen and I was not even surfing the web. My home page was changed somehow ...

Alternative Medicine to Lower Your Blood Pressure
Home remedies and homeopathic medicine have begun popular over the years as an alternative to prescription drugs. Many people are ...

  
  Recent Articles
Be A Rebel: Contrarian Investing
by Christopher Smith

Advantages of Online OTCBB Stock Trading
by Praveen Ortec

Online share trading can be a liberating experience
by Martin McAllister

The Bulls And Bears Game: Risks And Survival Strategies In Investments
by Wain Roy

How Do You React When Your Stocks Are Down
by Christopher Smith

What You Don't Know About Micro Cap Stocks
by Christopher Smith

Free Money in Stock Market: Conversion
by Alexander Chong

Stock Trading Tip
by Joe Grabowski

Penny Stock Winners - What To Do Next
by Christopher Smith

The Stock Market For Newbies
by Joe Grabowski

Forex Trading Course: A Must for Forex Beginners
by Zevs Borealis

How To Get An Advantage Trading Penny Stocks
by Christopher Smith

Can't connect to database