I can’t speak for the rest of the world, but many parents in the States love bragging about and showing off their wunderkids every chance they get. You’ve read the bumper stickers, heard the game-day comments about the kid hitting more home runs than Sammy Sosa, fingered through the endless photo albums of the next Brad Pitt – you get the point.
I have nothing against proud parents or any child’s academic, athletic or aesthetic fortunes. Bragging about your kid’s perfections just gets annoying, you feel me?
If your parent’s expectations where as high as my mother’s, then you would understand the need to always be perfect – at everything! I grew up with a mother who certainly wanted the best for me, and wanted me to succeed academically. Actually, she wanted me to be a pilot, and then a lawyer, and then a doctor, and finally a priest! I know… a lawyer?
“Academics will be your one-way ticket to success! Now, where is your report (grade) card?”
If I didn’t bring home perfect marks every quarter, I was beat not with a hand or belt, but with sharp eyes and the hardest upper-cut of guilt you could imagine. I felt worthless and like an utter failure every time I missed my marks. That need for perfection stayed with me as I grew older, as did the tendency to miss my marks! Thanks, Mom, I love you!
When trading with money on the table, novice traders obviously take the same stance and look for perfection in every area of their trades. Many have a tendency to be like that first time driver, feeling unstoppable and having a move for everyone. They have the insider information, or this guy on that Web site said this, or their strategy is bullet-proof and guarantees profit. Others have the perfection bug and need to analyze and analyze anything and everything, twice! This need for perfection often leads to an inability for these novice traders to ever execute a trade or enough trades to profit from. They’re so obsessive about every last piece of information that they become paralyzed.
The problem with this is that trading is not something that automatically performs only because you have a standard for perfection. Strategies aren’t failsafe, information isn’t always exact! You can plan for days and weeks and think you have every base covered, only to have something unforeseen occur. You want to be the best trader you can be (in the Army!), so of course you make every effort towards perfection. You don’t want to be Joe Schmoe trader, dropping trades left and right. But you can’t be Mr(s). Perfectionist either.
The more extreme your perfectionism, the worse it makes you feel when you come up short. For some, working towards elevated standards has the tendency to make them nervous and uneasy because they fear the possibilities of failure. That in itself was the power to make you less industrious because you don’t feel comfortable taking risks. Instead you hold back and cross your fingers. And when the trade doesn’t hit, you hit yourself!
Trading is definitely about risk, taking it, not taking it, managing it. To be profitable, you will at some point have to take risks to seek out new opportunities. If you endlessly hold back in your pursuits for perfection, you’ll never feel like you did everything you could possibly do.
“Am I lost forever?” you ask. You’re not.
“Then what do I do?”
Strive to be the kid who beat up the honor student. Strive to be average. Let the “I need to find the perfect plan” trader take a break and grab some lunch. Let him/her go, you stay! Don’t work on formulating the super profit trade, but something more simple and basic. You will likely feel more at ease placing the trade, and be more willing to place the trade more often. At times trading becomes more about probabilities. Just placing more trades can put you in a more profitable position. That’s not to say that just trading more will result in higher profits. Don’t forget about that small thing called risk management. Like we said earlier, we’re trying to get you away from being Joe Schmoe trader.
Observe how you feel with this level of trading and then raise or lower your intensity incrementally. Get a good feeling at the various degrees of trading; if you’re still feeling uneasy or tight, aim for something more moderate. But definitely try more than just one other degree. You may get the creative juices flowing more so with one than another, maybe even getting you closer to constructing that rain maker trade or plan you were using all along.
The intensity sometimes necessary to be a perfectionist can be counterproductive for your trading. It can put you on edge, and it can keep you from making some of those essential leaps of faith to new opportunities and profits. Take the above approach and see what it’s like, and take it from there. Maybe the perfectionist trading style is the only way for you to survive and maybe not. If you still can’t find that happy place, you can always quit. Ouch! Don’t do that! Take your pains out on the honor student. Or his Dad. Or Mom. Or both.
**Disclaimer – I take no responsibility if you go to your neighbor’s house and beat on Mom, Dad, Son, Daughter, dog, or combination**