Advice from a gambler who’s beginning to learn to overcome an obsession, to become a real trader
Last week I touched on the addictive gambling side of trading and today I shall try and explain it a bit better.
As many of you know I’m a chef. Us chefs, because of the industry we work in, are pretty much adrenaline junkies. Why? Well we typically work 5 x 12 hours shifts per week on our feet. In those 12 hour shifts you have 2 feeding times of lunch and dinner where we get very busy for a couple of hours. The adrenaline levels sky rocket during those busy periods. So, in our working lives we have serious highs and lows, and that’s just in 1 day. My typical day will be in at 9am, 2 coffees, get the kitchen set, sort mise en place (prep for next service), sort menu, get slapped (busy) for lunch, clean down, eat, mise en place, tea, get slapped for evening, clean down, finish around 10, go home, chill out, lights out around 1am. This is normal. I’ve said this because it shows the rollercoaster our bodies go through.
This way of life actually leads to much wider problems. What do chefs do to replace this “rush”? Well most have some sort of addiction problem. I firmly believe it’s rife in my field and it hasn’t really been addressed. You name it, alcohol, drugs, gambling, porn, eating, anything really which gives heightened pleasure or that dopamine effect. Mine has been gambling.
This is a trading site so why are you reading about me and Addicts Anonymous?
The simple answer is the rush of adrenaline. You are sat at your computer waiting for a big data point. Let’s say NFP every last Friday. You know whatever happens there will be big volatility. You have those little butterflies in your stomach. The anticipation is building. You’ve probably got a position in this and it’s either going to be a big winner or a big loser. Bang. Numbers out. Price moving like Zebedee on pills, your heart rate is now well up and you’re taking in as much info as possible trying to make your decision long or short. You’ve been gambling and you’ve got your hit. Win or lose it’s a by-product. Your satisfied because your body has produced adrenaline.
Trading is very much an addiction. Like all addictions one has to control it. It’s always there for me and probably the biggest challenge in my life is to quell those urges to lump £5 per point on a 50/50 bet on NFP. This is something I’ve only recently been able to succeed with.
Why is this so important? Well, coupled with my previous article of evaluating risk, not gambling on trades to get a hit is in itself making me much more profitable. We seemed to have arrived back to the same word. Control. For some, it is so much easier to battle, contain and control. For others it’s a losing battle and those traders become just another stat in the 85% of losers in trading. Also, there’s no easy fix. Yes, it’s easy to write it all down like this in a methodical way, but when you’re the one sat there, heart pumping away, you’re the one who makes those decisions. One way to control it, I find, is actually not trading it! Waiting and being more calculating takes away some of that rush feeling. Easier said than done. Muppet boy here clicked a lumpy buy on Dow over the Fed in January (I think it was), and was offside very quickly. Bad trade and chuffing stupid. I wasn’t in control. I wanted in on the action.
From the stories I hear from grizzled ex-City boys who have been in the trenche,s they appear to have many of the same problems us chefs suffer from. I expect it’ll be the same for many people who are under duress in their full-time jobs. Doctors, nurses, teachers, journalists, farmers. You think about it, pressure comes in many different guises. It’s how you manage it that matters. Trading is no different at all. A successful trader will be able to detach and analyse with a cold emotionless eye. He might still lose but he has eliminated part of the risk.
Part of being a successful trader, one has to be brutally honest with one’s self. When you’ve identified the problem/s you can go about fixing it. When they’re fixed or controlled then one has taken a huge step to profitable trading.
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