Guilty As Charged – Drop the Load and Be Free: Part II

We spent the last article introducing the subject of guilty feelings and their affects on your trading. In Part II we try to identify the causes behind these feelings.

Why are you feeling this way? 

Could the money you just lost have been used somewhere else, for something more important? It’s important to realize that as a beginner, you should only be trading real money that you are absolutely ready to give up. You’ll naturally feel guilty losing money that you can’t afford. If this is your situation, you’ll need to reevaluate your live trading. Guilt will overcome you if your trading is damaging your financial well-being. Maybe it’s time for that weekend job flipping burgers or walking your neighbor’s dog. Why not?

Maybe your guilt comes from your parents or your need to uphold some moral guideline from your youth? It’s possible that you grew up with parents teaching you that money was sacred and you shouldn’t “gamble” it away. This belief is held my many and there’s nothing wrong with it. But (there’s always a ‘but’), as an up-and-coming trader, your perception of money must change if you hold this true. Professional traders view money purely as a way to get from point A to point B. Point A represents your money now, Point B presents your money now, too, but more of it! Money becomes your tool to make more money. And don’t think of your trading balance as money. Imagine you’re just using it simply to keep track of your trading progress. The higher your balance, the better you’re doing.

Finally, guilt could be a symptom of your need for perfection. Your guilty feelings come about because you consider trading errors and losses signs that you are an insufficient trader. And when the losses occur, you take them personally and develop an idea that you are a bad person and have no business trading. You’ve got to get it in your head that losses happen to everybody and it’s a part of trading. As with any sport or game, there are winners and losers; that’s a certainty. In trading, same thing – you win some, you lose some. And losing is inescapable. As a beginner, the losses will grow, but that doesn’t mean you’re insufficient as a person. It just means that you have more learning to do, more experience to gather under your belt, and other options to explore. Experienced traders fall into this as well. A severe string of losses occurs. They feel guilty and at fault for the outcome. Yet, it’s possible that market conditions are temporarily adjusting, and that their strategies must be updated accordingly. It doesn’t mean they’re deficient in their skills. 

My mother always used to say, “Be productive!” Guilt has a way of making you a sponge for negative thoughts about your trading. You sit there sulking around the office, reevaluating every decisions ever made to the point of a mad man. It’s definitely not a productivity producer. When it comes to trading, there isn’t always time to sit and dwell about the “could-have-beens” or “what-ifs”. Guilt can put us in our place at times. But with trading, understand that losses are routine, and anything that creates, ummm, un-productivity, needs to be controlled and dealt with. Become a problem solver rather than a problem dweller. Formulate new strategies, test new theories, and explore your options to keep guilt at bay.

  • devyshka

    Great information there! It gets harder in this world when we are surrounded by perfectionists everyday and when people view failure as if you are the biggest loser ever!! It’s hard to shake that guilt off and move on. But I guess that is the amazing thing about trading and understanding this….not only is this a lesson in trading but in LIFE! Let it go and move on….worry is like a rocking chair…it get’s you no where. Let yesterday worry about yesterday and tomorrow worry about tomorrow.

    Future Queen LaPipa

  • pinetree

    Great writing Dr Pipslow. It is incredible how emotionally charged the topic of money is. For example — last week, a group of my friends went out for dinner –we all got into a(big) arguement when we were a bit short on paying the bill — we started accusing each other of not paying their fair portion of the bill (it was less than than $10 we were arguing about. –Also, I have not talked to my younger sister for about a year — and it was because we got into an arguement for about $25 disagreement. Hence we all have powerful emotional connections with money issues. We are afraid to death to take a loss even if its in the pennies. We get incredibly upset if we “perceive’ we did not not get our fair share. Even if we are dealing in the nickle and dimes. If we go to the grocery store and buy an item for .99 cents — and the grocery clerk does not bother to give that .1 cent change — we often get suspicious of the person. Money is a powerfully emotionally charged issue. And many of us are on auto pilot not having a clue what forces are controlling us. It takes a lot of self introspection and hard work –hence few bother taking that journey.

  • devyshka

    Great information there! It gets harder in this world when we are surrounded by perfectionists everyday and when people view failure as if you are the biggest loser ever!! It’s hard to shake that guilt off and move on. But I guess that is the amazing thing about trading and understanding this….not only is this a lesson in trading but in LIFE! Let it go and move on….worry is like a rocking chair…it get’s you no where. Let yesterday worry about yesterday and tomorrow worry about tomorrow.

    Future Queen LaPipa

  • pinetree

    Great writing Dr Pipslow. It is incredible how emotionally charged the topic of money is. For example — last week, a group of my friends went out for dinner –we all got into a(big) arguement when we were a bit short on paying the bill — we started accusing each other of not paying their fair portion of the bill (it was less than than $10 we were arguing about. –Also, I have not talked to my younger sister for about a year — and it was because we got into an arguement for about $25 disagreement. Hence we all have powerful emotional connections with money issues. We are afraid to death to take a loss even if its in the pennies. We get incredibly upset if we “perceive’ we did not not get our fair share. Even if we are dealing in the nickle and dimes. If we go to the grocery store and buy an item for .99 cents — and the grocery clerk does not bother to give that .1 cent change — we often get suspicious of the person. Money is a powerfully emotionally charged issue. And many of us are on auto pilot not having a clue what forces are controlling us. It takes a lot of self introspection and hard work –hence few bother taking that journey.

  • GenghisClown

    Yes. I remember how proudly I described my plans for investing/trading to a very dear friend, and how I felt that once I learned how to make my money work properly, I would be in such a terrific position to teach friends and family how to do the same. The prospect of learning to get what I want and being able to help other people do the same was so exciting, and I was happily conveying this to her. She promptly began explaining to me why she will never, ever, EVER become involved in trading or investing, and proceeded to imply that such activities were evil, at one point even equating them with devil worship! I don’t think I’ll ever forget how hurt I was by her attitude. People really will burst your bubble. It’s depressing when you realize how few people understand money and how to use it.

  • GenghisClown

    Yes. I remember how proudly I described my plans for investing/trading to a very dear friend, and how I felt that once I learned how to make my money work properly, I would be in such a terrific position to teach friends and family how to do the same. The prospect of learning to get what I want and being able to help other people do the same was so exciting, and I was happily conveying this to her. She promptly began explaining to me why she will never, ever, EVER become involved in trading or investing, and proceeded to imply that such activities were evil, at one point even equating them with devil worship! I don’t think I’ll ever forget how hurt I was by her attitude. People really will burst your bubble. It’s depressing when you realize how few people understand money and how to use it.

  • devyshka

    Wow GenghisClown! That’s really sad :( But I can relate. Now I never really thought investing was devil worship, but I did think it was a waste of time, considering most people lose their money. It took my ex-boyfriend a long time to get me to think otherwise and I learned that swapping dollars for hours for the rest of my life wasn’t cool. I realized that Job meant Just Over Broke. My ex helped me by having me read “Rich Dad Poor Dad”. What an eye opener! After that, things took off and I saw the other possibilities. Some people think using money to make money is wrong…but I think that equating your precious hour to a set dollar amount is more wrong. Don’t give up on your friend…hopefully they will come around. If not, that means that there are more wins (and losses) for us ;)

    Happy Trading!

    Queen LaPipa

  • devyshka

    Wow GenghisClown! That’s really sad :( But I can relate. Now I never really thought investing was devil worship, but I did think it was a waste of time, considering most people lose their money. It took my ex-boyfriend a long time to get me to think otherwise and I learned that swapping dollars for hours for the rest of my life wasn’t cool. I realized that Job meant Just Over Broke. My ex helped me by having me read “Rich Dad Poor Dad”. What an eye opener! After that, things took off and I saw the other possibilities. Some people think using money to make money is wrong…but I think that equating your precious hour to a set dollar amount is more wrong. Don’t give up on your friend…hopefully they will come around. If not, that means that there are more wins (and losses) for us ;)

    Happy Trading!

    Queen LaPipa

  • PipJunky

    Great Subject Doc.

  • PipJunky

    Great Subject Doc.

  • stricklyd

    GREAT ARTICLE DR. PIPSLOW I CAN RELATE, COMMON SENSE BUT THIER A-LOT FORCES RELATING TO MONEY AND HOW ITS BEING USE.
    I LEARN TO NOT TO FULLY SHARE MY UPS AND DOWNS TO MUCH AND WHEN I DO ITS A TIGHT GROUP OF PROVEN FRIENDS.
    BUT I’VE DEVELOP A MINDSET BASED ON HAVING BUSINESSES AND RENTAL PROPERTY, ALSO LOSING EVERYTHING AND STARTING OVER.
    TO POINT OF LEARNING THAT HUMILITY CAN BE A FORCE TO HELP KEEP YOU BALANCE. IT CAN MAKE RIDE EASY TO HANDLE
    STRICKLYD

  • stricklyd

    GREAT ARTICLE DR. PIPSLOW I CAN RELATE, COMMON SENSE BUT THIER A-LOT FORCES RELATING TO MONEY AND HOW ITS BEING USE.
    I LEARN TO NOT TO FULLY SHARE MY UPS AND DOWNS TO MUCH AND WHEN I DO ITS A TIGHT GROUP OF PROVEN FRIENDS.
    BUT I’VE DEVELOP A MINDSET BASED ON HAVING BUSINESSES AND RENTAL PROPERTY, ALSO LOSING EVERYTHING AND STARTING OVER.
    TO POINT OF LEARNING THAT HUMILITY CAN BE A FORCE TO HELP KEEP YOU BALANCE. IT CAN MAKE RIDE EASY TO HANDLE
    STRICKLYD

  • Forexia

    Just read this post today. One thing I just want to say that we traders at least have the courage to tread on a harder path to have a life of our own instead giving up our lives slaving for others for measerly gains.

    And to all those who condemn, doubt or despise us for being professional traders, we will one day be able to make more money just in a few hours while sitting under the sun and sipping on a Pina Colada, while they have to commute in sub-zero temperatures to a dimly lit little cubicle, working a 12-hr day making minimum wages AND still subjecting to the whims of a loser boss

    Comparing to that, I will face all the pains of trading anytime even when I haven’t reached the “Pina Colada-sipping” stage yet! :-)

  • Forexia

    Just read this post today. One thing I just want to say that we traders at least have the courage to tread on a harder path to have a life of our own instead giving up our lives slaving for others for measerly gains.

    And to all those who condemn, doubt or despise us for being professional traders, we will one day be able to make more money just in a few hours while sitting under the sun and sipping on a Pina Colada, while they have to commute in sub-zero temperatures to a dimly lit little cubicle, working a 12-hr day making minimum wages AND still subjecting to the whims of a loser boss

    Comparing to that, I will face all the pains of trading anytime even when I haven’t reached the “Pina Colada-sipping” stage yet! :-)