There’s no shortage of trading advice out there.  But does it help you improve?

Some well known people, including a few that I respect in terms of what they’ve contributed to the trading community, give good suggestions. But for the vast majority of traders when they follow the advice given they continue making the same mistakes.

The advice often includes:

Maintaining trading performance statistics, gathering and analyzing additional market information, keeping a trading journal, reading and trying to follow ‘best practices’ of good traders, creating a new list of rules, engaging in ‘deliberate practice’, reading a great trading psychology book, practicing mindfulness meditation, participating in group coaching, and others. All excellent advice; I can’t argue against any of it.

However what I see all the time is that these are not enough. Necessary, but not sufficient for actual behavior change.

I get emails all the time from traders who are following the above advice but continue to make the same mistakes. What I see in my coaching practice is it takes a different kind of work to improve performance. Performance improvement requires behavior change. Breaking your rules and veering from your plan, being rigid and not adapting to changes in the market, whatever the issue, it takes a special kind of work to create behavior change that leads to sustainable improvement in trading.

As I’ve written before, It’s time to accept the idea that you are in fact trading an inner market just as much, if not more so, than the market you see on your screen. That’s why you veer from your plan and those post-it notes get ignored. We don’t see the market as it is we see it as we are.

The dynamics within your inner market are behind the hesitation, the impulse trades, the doubling down on losers, the early exits to grab a small profit, inability to adapt to changing market conditions, and so on. Another way to say it….it is the supply and demand dynamics within your own personal inner market causing you to veer from your plan.

If you agree that the inner market is a big influence on your P&L, it is logical that the inner market is worthy of analysis. In other words, self-improvement for a trader often begins with a very special type of self-awareness (The caveat here is that you also have an edge in your trading method). This includes learning to become aware of what was previously subconscious or something you are in denial about.

In order to be a successful trader, or take it to a higher level, you have to do something different.  If you’re a trader who has a hard time taking a loss, or waiting for the right entry point, prematurely exiting winning trades at the first sign of heat, or the ever common pattern of quickly giving back all the profits that you made on your last good run…..those are the issues that need to be addressed. If you don’t address the right issues you’ll never make it in trading. Period.

I’m going to give you some advice that you probably won’t hear elsewhere. I keep my coaching practice small, partly due to time constraints and partly due to ensuring a good fit. And this is where I can give you the advice that you probably won’t get elsewhere….what I look for in a potential coaching client (in addition to them recognizing they have some type of edge in their trading method).

Admittedly, this may sound arrogant or elitist, but one of the reasons I look for certain qualities is because I only want to work with traders who have the best chance for improvement. Successful coaches look for certain players.. Having said that, I’m not perfect and not all my coaching clients do improve, but about three out of four do achieve sustainable improvement.

One thing I look for is self-honesty. A trader needs to be very honest with him or herself. Believe it or not, once you have an edge, self-honesty is the first step to making money in the market.

Related to self honesty is a special type of courage. The courage to look at things that may be very uncomfortable, including things outside of trading.We’re not just trading the market, we’re trading an inner market. It takes real courage to begin to understand your inner market. Our self-worth, our status in the eyes of others, and a host of other things are related to our inner market.

Can the trader handle discomfort? As a coach I walk a fine line – knowing when to comfort the afflicted and when to afflict the comfortable. I don’t intentionally inflict discomfort but the work often involves looking at and dissecting issues that the trader has avoided or is outside of their conscious awareness.

Why does this matter? The capacity or the ability to learn to tolerate discomfort in all its various forms – losing, being wrong, waiting, taking heat, booking a profit and see it continue without you, missing out, adapting to changing conditions, etc. This is the stuff of trading! I first learned this when I was involved in sports psychology and my work in threat assessment and CISD (critical incident stress debriefing), including work with law enforcement and special military forces.

Much of our discomfort begins on a subconscious level, leading to a final act – the actual behavior – showing itself as a “trading mistake”. Or series of related mistakes. Often part of a theme that gets repeated. A significant part of the coaching involves helping a trader recognize subconscious patterns that lead to trading mistakes. And that type of work invariably involves a level of discomfort, looking at things that you previously never really wanted to look at, or completely dissect and understand, so you can move past the problematic habits and into a new level of trading.

Behavior change that leads to sustainable trading improvement does not occur overnight. Whether you’re an independent self directed trader at home trading your own capital or managing other peoples money, the fit between coach and client is critical. If you are interested in this type of work email me and we can explore if there’s a good fit.

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