How to Get the Ego Out of Trading

Q: “Hey Joe! How do I get my ego out of my trading? I want to be market-centered, but I find myself consistently being self-centered.”

One thing I know for sure, your self concept has to be separate from the trading. You began as an individual long before you ever thought of trading. And you exist as an individual beyond the time you spend trading.

When personal self-worth gets tangled up with your trading, it not only damages your concept of your personal worth, it sabotages your trading.

You must not allow your trading errors to ruin your feelings of self-worth. You must not internalize the mistakes you make. You have to avoid feelings of guilt, persecution, and despair.

You must learn to divorce your ego from your trading.

In my first manuscript on trading, Trading by the Book, I said that trading is a business in which there is no competition. I meant that in the sense that the only competition in trading is yourself. The market is impersonal. It doesn’t know you or care about you.

Your job as a trader is not to will the market to go where you want it to go, but rather to discover which way the market is going and join it – get in step with it.

That means total surrender of your will to that of the market. Surrender to it and go with it. If you set your will against the market, you will invariably be smashed. Forget being right! Concentrate on the fact that the market is always right.

Uncertainty is a part of trading. But we cannot allow uncertainty to become part of the image of ourselves. Consider, are you making any of the following ego-centric mistakes?

· Trading without a predetermined exit point.
· Not pulling the trigger on a trade, or hesitating before pulling the trigger.
· Trading too large a size, or trading too often.
· Marrying a trade, or marrying a market.
· Adding to a losing trade.
· Not taking profits when they are there on the table.