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Beliefs About Money: A Possible Source of Self-Sabotage

Do you have trouble following your trading plan? Many novice traders do. They develop a plan with specific guidelines as to when to enter and when to exit. The night before it all seems so clear, what they are going to do and how they are going to do it. But when the markets open the next morning, they are persuaded by a little voice to throw the plan out the window. It's a common ailment, and many times people abandon their trading plans because they secretly don't want to make money as a trader. They don't know how trading fits into their lives.

They question whether they should be trading, and they secretly believe that it is wrong to make money. Often, they think it hurts another person.

If you have these beliefs, it is vital that you identify them, and change them, before you continue to sabotage your trading efforts.

Have you ever heard the saying, "Money is the root of all evil"? Is there any truth to that belief? The saying comes from the Bible, but it is misquoted, as I will explain just ahead.

Some people believe that money is corrupting, and that anyone who has it is corrupt. Some people think that people with money are greedy, unprincipled, and insensitive, and that it is cleaner, purer, and more virtuous to live with only a minimum amount of money. If you hold these beliefs, even if it is in your subconscious, you don't have a chance of having money and living prosperously.

Many people believe that the saying, "Money is the root of all evil" is a warning from the Bible, but the actual meaning of the Biblical passage is quite different. The Biblical phrase in the book of Timothy is, "The love of money is 'a' root of all kinds of evil." It is the lust for, and coveting of money for its own sake that is problematic. Money in and of itself isn't evil. Let's face it, money isn't even real! It's a human abstraction. You can't eat money. You can't build a house with money as the construction material. Money is just intangible currency we use to purchase concrete goods and services.

What you do with money is up to you. If you want, you can build a homeless shelter, or start a charity with the money you make. Money isn't evil. It's what you do with it that counts.

Some traders find it useful to set aside a portion of their profits for charity. It allows them to know deep down that should they do well as a trader, they can make a clearly defined social contribution. Other traders see trading as a way to take care of their family, a very noble motive.

If you are holding back because you believe that it is wrong to make money by trading, it is important to explore this belief. Traders have many reasons to make profits in the markets. It isn't merely an aimless quest for money. Professional traders have a rare talent, and feel fulfilled because they express their talent by trading profitably.

If you are trading merely to acquire money in order to gain fame and status, you probably won't last very long. But if you remind yourself of the more noble motives for trading, such as taking care of your family or making a social contribution with some of your winnings, you will feel more at ease as you trade. You won't think of yourself as "corrupt" or "indecent." It's vital that you look deep inside yourself and identify why you trade. If you truly believe it is what you are meant to do, you'll be more willing to put in the time and effort to sharpen your trading skills. The little voice in the back of your mind will be optimistic and upbeat. You'll think, "I'm doing the right thing."

Rather than sabotage your efforts, you'll cultivate discipline. You'll work hard, practice trading techniques, develop a solid knowledge base - and soon, you'll become a profitable, disciplined trader.

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Tuesday, 25 June 2024

Derivative transactions, including futures, are complex and carry a high degree of risk. They are intended for sophisticated investors and are not suitable for everyone. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results, and all of which can adversely affect actual trading results. For more information, see the Risk Disclosure Statement for Futures and Options.