Dare To Be Average

When you put your money on the line, there's a strong need to seek out perfection. Many novice traders believe they can get everything just right. They believe that they can locate infallible information, find the perfect setup, and execute every trade flawlessly. In "Trading in the Zone," Mark Douglas notes that many traders are so consumed with making the perfect trade that they never get around to executing enough trades to make a profit. It may be difficult to accept for the overly compulsive trader, but trading is not a profession where you can persistently demand perfection. There's no such thing as a sure profit. Information is often inaccurate. You can plan a trade methodically only to have it fail because an unanticipated adverse event thwarts your trading plan. It's natural to strive for perfectionism. You don't want to be a sloppy, impulsive trader. That said, you don't want to be an extreme perfectionist either.

The harder you strive for perfectionism, the worse your disappointment will become. Perfectionism has more disadvantages than advantages. When you strive for overly exacting standards, you feel so tight and nervous that you actually aren't very productive. You are unable to take risks because you fear failure. You tend to hold back rather than make new discoveries. Trading is a profession where you must take risks and explore new market opportunities. If you continuously strive for perfectionism, you'll never feel satisfied. You'll always think, "I could have done better."

Is your perfectionism out of hand? Here's an exercise for learning about the impact of your perfectionism: Dare to be average. Feel what it is like to be average and see what happens. Rather than search for the ideal setup, why not just find a profitable setup? What happens when you just make an average trade? Sure you won't make as much profit, but you might feel better. You will probably feel relaxed. Compare what it feels like to strive for high standards, moderate standards, and low standards. You may find that merely going for moderate standards makes you feel better. You may also find that you put on more trades, and achieve greater levels of profitability. Trading can be a matter of probabilities.

To get the law of averages to work in your favor, you must make trade after trade. If you manage your risk, and put in a moderate effort, you can make enough trades to come out ahead. As long as the setups are reasonable, and you are using sound trading strategies, you can get the losing trades "out of the way" and focus on the winning trades. But if you are an extreme perfectionist, you'll always be on edge and unable to make trades. And because you are so concerned with overly high standards, you may never discover and take advantage of new, profitable market opportunities. By easing up, you'll feel more relaxed and creative. Ironically, you may end up more profitable by daring to be average, instead of striving for absolute perfection. So dare to be average and see what happens. You may be surprised at what you find.

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