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Ever Hit a Wall?
Five Highlights From Chapter 12 of Psychological Analysis by Adam Sarhan
I’m coming to you a little late this week because, well, this entire week got away from me, and I just flat ran out of time.
When I say that this week got away from me, I mean it REALLY got away from me. I didn’t finish ANY books at all this week, and I barely made progress on the ones that I have been reading.
On the bright side, I did some good work in not beating myself up about this (like I usually do) and recognizing that I made some significant strides in other areas of my life while also getting caught up from a quick vacation.
I’ve been working VERY hard to become LESS of a workaholic, and I think that letting go of some deadlines and acknowledging that the stress they created wasn’t healthy was a big step for me this week.
I’m going to take that idea and run with it tonight because I’m going to order a full spread from my favorite Mexican spot and kick back on the deck to watch the entire AEW Double or Nothing PPV from start to finish.
That doesn’t mean I’m planning on slacking every week, though, and I’ll be jumping right back into my regular reading on what should be a calm day at the restaurant tomorrow. So expect to see some progress on all of the books this week, including hopefully completing at least one.
This week’s reading was Chapter 12 of Psychological Analysis by Adam Sarhan, and we got more excellent pearls of wisdom packed into this one. Let’s jump right in and start discussing five of my favorite quotes.
Some People Want the Drama
Some people want the drama around telling a story about how they got stopped out or “battled” Wall Street. So they end up engaging in self-sabotage and get the drama. Others just want to win, so they dig deep and do what is necessary to figure out how to win. Either way, in the end you get what you want from the market and in life. (163)
Sarhan digs into Ed Seykota’s famous quote about how everyone gets what they want out of the market, positive or negative, and he expands that to include life as well. He also points out that most people don’t actually know what they want, so that would be an excellent place to start.
For me, this drives home the point I am constantly stressing to my team that the mindset you bring to work is the most crucial factor that determines the type of day you are going to have.
Being a consistently positive person is not easy, but I have found that it is the easiest way to have a good life filled with happy memories.
Healthy Respect for Risk
A little bit of fear is okay; it gives us a healthy respect for risk, and my first rule of trading is to respect risk. But if fear is keeping you from making a decision, then it’s the kind of “unreasoning, unjustified terror” that FDR described in his inauguration speech. (165)
In his section on “Fear,” Sarhan explains that smart money traders use fear to respect the risks they take, but they never let it use them.
There is obviously a very fine line that we are walking here. You want to feel enough of the fear to keep your ego in check, but you don’t want to let in any more than that because you risk letting that fear stop you from taking calculated risks.
Here is the fun part: it’s always way easier to identify this line once you have the benefit of hindsight. It’s much more difficult when you’re operating in real time.
The lesson I take away from that is to stop beating myself up for falling too far on either side of the line. Let some fear in, not too much, then evaluate what you did and make adjustments. It’s just like anything else we do in life.
The Other Side of That Pain
Losing money is painful. Failure is painful. Being told you’re wrong is painful. Spending countless hours studying the market and not making big money is painful. So what? Success is on the other side of that pain. (166)
Sarhan explains that pain is the thing standing between each of us and the things we desire. To find success, we must embrace the process of fighting through that pain, which could be anything from not eating cookies as you get fit to taking some small losses as you become a successful trader.
Are you willing to endure whatever pain the market deems necessary to get to the other side and enjoy trading success?
I’ve actually been doubting my own commitment to enduring the pain lately. Wouldn’t life be much easier if we just dumped our money into index funds and spent our evenings keeping up with everything on all the streaming platforms we subscribe to?
That’s a loaded question with an obvious answer, but there are also times when real life gets in the way of market research and the choices aren’t so easy, or the pain really hurts.
It’s important to remember that the only way to find success is to fight through that pain.
Take Control of Your Life
Take control of your life. Control it by making better decisions. Control how you react to what happens to you. Think and plan ahead (I can’t stress this enough). Plan to win. Identify your bad habits. Fix them. People are creatures of habit; we have good habits and bad habits. The key is to focus on eliminating the bad habits and developing more good habits. (172)
If there is any better advice for living a good life in any book anywhere, I don’t know that I’ve seen it. This is just perfect. I need to read it and re-read it every single morning.
Then the next paragraph was just as good.
Exercise Self-Control in All Things
Exercise self-control in all things. Either your mind controls you, or you control your mind. Far too many high-powered executive types have a work hard/play hard mentality, and all too often it means they work crazy hours and then abuse their body with terrible food and frequently drink until they black out. Be smart. Don’t do this. This is not a recipe for long-term success. (172)
So if we put these last two highlights back together like they are in the book, the author tells us that we need to take control of our lives by managing our habits and exercise self-control by not abusing our bodies. There is no doubting that this is the path to a healthy and prosperous life.
Go back and re-read those last two highlights one more time. If you can get that message ingrained into your daily life, you will absolutely find success on any path you explore to seek it.
Next week, we are onto Chapter 13 of Psychological Analysis, which is called “The Most Important Skill to Master” and looks to be about risk management. I’ll be curious to see what Sarhan has to add to a topic that has been covered by so many different experts over the years.
We only have two more weeks in Psychological Analysis after that, and I’m already thinking about taking a slight turn for our next book and reading Money by Tony Robbins.
This is not a trading book, and if I remember correctly, I think it actually presents arguments against attempting any type of trading. I’m curious to see if we as a group can properly counter those arguments as we come across them…or if Robbins and the experts he consults with can convince us that we really would be better off watching television at night instead of scanning through stock charts.
I hope everyone has a fantastic holiday followed by a profitable week of trading!