The Battlefield Of Discipline in Trading
DISCIPLINE
You need to understand that no amount of goals setting without discipline can lead to success. You cannot succeed in trading without discipline. No one can succeed in any business let alone trading without absolute discipline. Discipline is the bedrock of successful traders. It's the discipline that separate human accomplishment from human failure, successful traders from unsuccessful traders, winning trades from losing trades. It allows you to stay glue with your goal and desire. I really believe you and I cannot be exceptionally happy without discipline, in the same way we cannot be exceptionally organized, wealthy, and intelligent without any form of discipline. In my own views and few traders I have interviewed, trading system is rated far below discipline and money management in the ladder of success in trading business. The best place to meet people of great achievers, investors, traders, writers, lovers, fathers, etc is the club of discipline. It's the only parameter that separates you from million traders. A discipline person knows he must be willing to dedicate 100% of his time and other resources to the success of a chosen profession. No matter what it takes, he's willing to endure. The ability to execute each trade as planned is discipline. When you follow through your trading system and plans, you exercise good discipline. The trading system may be well back-tested and reliable, its discipline that will makes it work and effective. No system can be 100% accurate and generate 100% winning trades at all time thus during the drawdown, its discipline that will make you take the loser quickly and move to next trade, stick to the system as long as you believe in workability and reliability that in the long run it will generate profits. The discipline of the trader manifests in his decision taking. When you are trading, always remind yourself that discipline in terms of acceptance of the outcome of the result in whichever way is taking responsibility. You must accept the risk before you open any position. Trading should be treated like a business, uplifting yourself from realm of unconscious state of emotional and rational incompetence to mental and emotional state of competence is as result of proper preparation and discipline. When you get into a tight place and everything goes against you, till it seems as though you could not hang on a minute longer, never give up then for that is just the place and time that the tide will turn says Harriet Beecher Stowe. My experience has really helped to make simple classification of discipline in trading. Emotional, System and Professional Discipline. A trader may not be perfect in all but should strive to improve every day.
Emotional Discipline
I have read books upon books about how to remove emotion from trading yet I have not seen anyone who has successfully removed emotion from trading. I have only seen people who are aware of their emotion. You cannot totally remove emotion from trading - never. But since you understand now that your self-awareness is the most important discipline factor, you can use any level of your emotion to your advantage (conscious and unconscious). There is logical distinction between being aware of feelings and acting to change. The emotion authors, writers, and other traders are trying to explain is the unconscious emotion. These two emotions need not be generalized as emotion cannot be totally eradicated in trading. The way to work it out is through discipline and understanding by bringing the unstable unconscious emotion to stability. The moment emotion comes into awareness, evaluation set in.
Fear of Failure
This is the most prevalent form of fear. All new traders have this form of fear at one point or the other. When a trader loss a trade and experience drawdown in his account beyond what he could imagine, fear gripes him and his interest of trading dwindles, he loses the drives and desire to trade again. He automatically avoids trading. This fear is caused by lack of discipline. You need to learn all you need and move on in the business. You are afraid because you don't want to fail again. Henry Ford was once asked by a journalist about advice he would give to aspiring entrepreneur, he said 'He should double the rate of his failure'. The only way to do that is doing what you afraid of.
Fear of Success
The fear of success comes from not believing that you are destiny to succeed. Earlier in my life, I fear success as undesirable element, as if it's meant for certain people until I had a turnaround in my academic. I struggled to champion a course and I succeed in doing that while those I believe to be smart are no smarter than me either. How in hell am I sabotaging victory myself, robbing myself the joy of success through fear of success? I never realized that I am not doing any good to myself neither my society admitted success as my virtue. The fundamental cause of this is your background and self-belief. Don't rob yourself of success because you deserve it. It's your nature. Everybody deserves to succeed. Stop thinking that the world will expect more from you when you succeed, the world will pay you for what you bargain. On the other hand, fears could be analysed and worked on because it could be a good source of spotting future danger. In this case it should be seen as stepping stone not stopping block.
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