Thursday, April 23, 2015

Mind Your Language


Try this experiment sometime:
Tell a friend to close her eyes and stretch her arm out wide. Now get her to think of the word "weak",
then press down on her hand. You'll notice her whole arm moves down easily.
Repeat the experiment as before, only this time, tell her to focus on the word "strong". This time you'll
notice enormous resistance in her arm, and you might struggle to move it at all.
Two simple words - two very different results.
If words are so incredibly powerful, just think what you do to yourself when you call yourself an "idiot"
or worse!
But words are more subtle than just name-calling. How about this one...
'Loss'.
Boy, think what that one conjures up. Missed opportunity? A gaping hole in your life? A theft? A
bereavement, even?
No wonder traders find it hard to take losses. Let's call it something else:
'An expense'.
Ah, now it's sounding better. Much more business like. Helps to put it into its true perspective.
Similarly, on the other side of the balance sheet, let's stop talking about:
'Win'
... which again is steeped in emotion... and change it to:
'Income'.
Income versus expenses. Isn't that what trading really is? A business.
You're much more likely to become profitable when you realize this. And forget about pitching your
ego into imaginary battles that ensnare your sense of reason along the way.
Mind your language when trading. Use neutral words at all times, both about yourself and the market.

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