What do you do when you lose your nerve?
- Thread starter mrsinister
- Start date
I can relate, I'll put together a GREAT month and then go
into a week where my returns don't match last months first week
and start questioning my entire strategy! I know in my head to be patient but sometimes thats the hardest part.
S*$# I need a faster internet connection! Oh yeah patient....
into a week where my returns don't match last months first week
and start questioning my entire strategy! I know in my head to be patient but sometimes thats the hardest part.
S*$# I need a faster internet connection! Oh yeah patient....
Buy low and bargain deals comfort our nerves. Because you know one day it will be flying high. Hope this helps.
When I hear this question, I think back to the times that I have felt a little battered by the markets. When I feel this way, it is difficult to have confidence in your choices, and hard to "pull the trigger". Almost every time I have felt this way in the past, it has meant that I was not well prepared. You may be the only one who really knows the answer to your question unfortunately. Something is missing and you need to ask yourself, what can I do to make me feel confident that I had my "ducks in a row" at the beginning of the day? I not a great believer in reading books to get the answer to a problem, but there is a book by Brett Steenbarger Phd, titled "The Psychology of Trading" that might help you. Also I remember reading posts from a thread called "Pete's Place" that may help you. Good Luck, Steve46
To quote excerpts from Jim Cramer's article back in 2000 (Jim is the hothead himself on CNBC)
"During those periods it is vital to retreat from the battlefield, where the casualties incur such a sting that they can affect your judgment in a negative way. As we are both extremely affected by the emotions of both losing money and losing in the face of competition, it is important to recall that we always succeed when we approach the process with teamwork and without emotion. We always prolong the agony when we are down on each other or down on ourselves. The fortunes of the firm depend on us, not the market, as we have shown an ability to make money, regardless of the market's direction."
"At all times the propensity to be angry or second-guess will color much of your thinking. You must consciously go beyond that. You will no doubt, in the course of the battle, replay and even undo certain trades that would have turned out to be good trades. These are casualties of war and every great army suffers them. If you dwell on them you will miss that opening in the enemy's flank that was meant for you to turn the battle around."
I especially LOVE this paragraph, talking about reserves (reserve=capital):
"The possibility exists that you may be doing too much at one level. Given the fallibility of any human being's thought processes, this instinct is most likely correct. Even when you think there is an opening to play offensively, you must guard against committing a reserve until you feel it is right. Great generals commit reserves when they don't need them, to be sure they crush the enemy. Bad generals commit reserves because they have planned poorly and are out of options."
What do I do when I lose my nerve? I look at the statements above, I review my basic trading rules, then get away. Go do something else. The market will always be there.
"During those periods it is vital to retreat from the battlefield, where the casualties incur such a sting that they can affect your judgment in a negative way. As we are both extremely affected by the emotions of both losing money and losing in the face of competition, it is important to recall that we always succeed when we approach the process with teamwork and without emotion. We always prolong the agony when we are down on each other or down on ourselves. The fortunes of the firm depend on us, not the market, as we have shown an ability to make money, regardless of the market's direction."
"At all times the propensity to be angry or second-guess will color much of your thinking. You must consciously go beyond that. You will no doubt, in the course of the battle, replay and even undo certain trades that would have turned out to be good trades. These are casualties of war and every great army suffers them. If you dwell on them you will miss that opening in the enemy's flank that was meant for you to turn the battle around."
I especially LOVE this paragraph, talking about reserves (reserve=capital):
"The possibility exists that you may be doing too much at one level. Given the fallibility of any human being's thought processes, this instinct is most likely correct. Even when you think there is an opening to play offensively, you must guard against committing a reserve until you feel it is right. Great generals commit reserves when they don't need them, to be sure they crush the enemy. Bad generals commit reserves because they have planned poorly and are out of options."
What do I do when I lose my nerve? I look at the statements above, I review my basic trading rules, then get away. Go do something else. The market will always be there.
When I lose my nerve I go on a killing spree...american psycho style.
No really though, I take time off, look at my mistakes from another perspective. I have learned first hand there is nothing worse than trying harder after making some sort of mistake (mark douglas is really helpful in this matter).
No really though, I take time off, look at my mistakes from another perspective. I have learned first hand there is nothing worse than trying harder after making some sort of mistake (mark douglas is really helpful in this matter).
Detach.
May be the problem is reflected in your signature 
"You can only be a victim if you admit defeat."
"You can only be a victim if you admit defeat."