What Do You Get Out Of Trading?

Some answers to my homework question:

1. What do you get out of trading?

first, thanks for asking this question...once you put things on paper you can't hide from them anymore...while it is embarrassing, i have to admit, i truly believed there was a "Holy Grail" trading system that would solve all my "problems". so much so that i have spent a small fortune and almost two decades looking for the "perfect" system that would satisfy my desire for success (at an endeavor that very few individuals have true success at) and overpower an obvious strong fear of failure...so what do i get out of trading?...a long and currently positive self-assessment and re-evaluation of my entire thought process, belief systems and limiting behaviors. my only wish (regret?) is the length of time and the "tuition" associated with the countless newsletters, seminars, home study courses (audio tapes, vhs tapes, cd's dvd's, webinars, etc.), software programs, data services, computers, brokers, personal conversations with several traders who wrote books, funny looks and head shaking from my wife, etc. has led me to finally realize that no amount of money can buy an "outside solution" to overcome an "inside problem"...my account balance truly does reflect my success at releasing these inner limiting programs...why did it take so long and cost so much in terms of time, money and frustration?...pick your saying..."when the student is ready, the teacher will appear"..."a problem can't be solved with the same thinking that created it"...or my current favorite..."Duh"

jmp


2. Great question Floyd...

My initial response to the question "What do I get out of trading?" was FRUSTRATED...ANGRY...IRRITABLE...GREEDY....FEARFUL....ARROGANT......PRIDEFUL.......SELFISH... DISTRACTED.....AND SHAME.

I become frustrated with myself for not taking profits when I should. I then allow the frustration to turn into self-hatred (anger). this perpetuates a constant state of irritability that lingers within my demeanor (it's really shame - the feeling that I'm bad or worthless because I continue to lose and not make money). I'm irritated that "I've done it again" and I'm irritated that I feel unable to make a change.

As I wallow in this state of mind, I then become greedy and try to win my money back. This causes me to break my rules, over-leverage and usually win because I'm fearful of taking another loss (in other words, I grab profits quickly). It is during this time that I THINK that I've kept the greed at bay (because I leave money on the table and take profits), the reality is that I'm lying to myself because I over-leveraged big time and got lucky that the trade went in my direction. The fact that I've now won perpetuates more self-deception because I think that I've now "got it" or "turned the corner" and are finally on the right track.

This causes me to become arrogant, place riskier trades where I eventually refuse to take stop losses (pride) because I KNOW THAT I'M RIGHT....or because I MUST be right or because I cannot afford to take a loss of this magnitude.

Of course, I eventually lose my entire investment, if not my entire account. This causes me to become totally self-absorbed and distracted as I throw myself a pity party, trying to figure out what happened, study more technical analysis gurus on the internet, read as many forecast predictions from as analysts and stare at the charts for hours to see how I can improve.

During all of this, because I hate myself, I'm acting like a freakin' jerk towards my wife and kids and I'm neglecting my responsibilities.

That is what trading has done for me so far.

When I tell people all of this, they always respond in the same manner, "It is obvious that trading is not for you. Why don't you just stop doing it?"

I don't know if it is pride or my competitive spirit but I feel as though if I walked away now, then I would be a quitter and that the market would have gotten the best of me. Also, if I quit now, it's as if I'm surrendering to my character defects of pride, arrogance, fear, greed, lack of self-control, shame etc...

I know that in order for me to make money in the markets, I MUST be a master of my own emotions and exercise self-discipline; character traits that all people should strive for. Unfortunately, I've been unable to do that since I began trading 20 months ago.

So on the positive side, what trading has done for me is brought about a greater self-awareness of who I truly am. I was blind to many of these character defects before I began to trade. And I determined to have them removed from my life and make money while doing it.

I just HOPE that starts today.

Let me ask you this Floyd. After you lost the last dollar of your 250K, did you KNOW that things were going to be different before you placed your next trade or did you HOPE that things were going to be different? In other words, there had to be a period of time after your 250K loss and before your 80% success rate where you reflected on your life and career as a trader. What transpired during that time, how much time elapsed between those two periods and what did you feel like during that transition?

I appreciate your time as you analyze my response to your homework assignment.

Take care.

Michael


3. Floyd, I really enjoy studying the market. Admittedly, with family, job/travel commitments, etc I cannot devote as much time to it as I would like, but I really enjoy it. Someday, I hope to make a living from these efforts, but it seems very nebulous at times. I hope to get there, sooner rather than later.
I also like to study complex options trading. I think money can be made if one is careful to understand the risks in any given position. The trick is in understanding adjustments, how they work, when to put on, etc.

It is my hope and expectation that this double-barreled approach will bear fruit one day. Since I have not really made profits with the OEX options approach, it does make it harder to visualize how things would be. But I have to believe that I can do it.

I got laid off 18 months ago. I got another job within three months. I was lucky. I do not want to rely on anyone else for my living. That goal and my pursuit of this goal is something else that I get out of trading.

Jon


4. Four years ago I got fired from a 200k a year job. I had worked for the company 15 years. They fired me on age. Prior to that I worked for a company for 20 years, my pension is bankrupted and they also let me go in a "cost cutting." Both times I was innocent and a good employee. My answer was to FUCK American corporations. I invested 30k in courses on trading, wasted all my money, and then found you. I trade full time for a living now, about 20 hours a week, and bring in about 220 k gross, after commission, or the past three years. I trade because I hate American corporations, and I find your teaching for extraordinary, but uniquely "right on target". To me , trading is my job.

BOB

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Many believe it's time to raise federal interest rates, and I see the issue. I see no need for short term rates to remain near zero as the economy clearly shows signs of improvement. Gold, oil and other commodities are skyrocketing (I think Gold will hit $2000 an oz, and advise Blue Chip Option subscribers (www.bluechipoptions.com) , the dollar is falling, and interest rates are near zero.)

My Floydian thoughts are simple. Raise the rates to 2% which are still very low, and send a signal to the world markets that the U.S. is serious about helping its falling USD, and stabilize concerns the world has.
With the country saving more, finally, we also need to encourage it. Right now we punish prudent cash investors and reward the more speculative investor, not a fair balance.

So Main Street still suffers, savers have little to gain, and Wall Street is having one of its best years ever. This says three things:
1. The Bush 585 billion bailout by Paulson paid off bank executives and calmed the storm for a few weeks.
2. The Obama infusion stimulated car sales, got the banks out of part of their derivative hell, and sadly without regulation yet in place (Congress) has allowed Wall Street to start the game all over again. It's half paid off.

Meanwhile the nation debates healthcare, armed with all false propaganda and facts, and never figures out that the insurance companies, RNC renegades, and pharmaceutical companies are not our friends, but our business and life enemies in many ways.

Face real facts, not false ones.
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The market repeated itself, with highs of 10,159 and lows of 9904. This allowed new put buyers excellent entry on the resistance lines, and profits for new trades to over $2.00 per contract. The 520 Call was also available for tight .5 profits, showing again a top and OTM options hesitant to move.

We'll be using the same signals around this whipsaw.