Published by admin on 28 Jan 2013
There are two ways that a person can make a living in today’s society. You can opt for security or you can opt for excitement. In the world of trading, the two rarely go hand in hand. Of course, one can ask what career out there is really all that secure. That factories are going overseas, more and more people are outsourcing their needs to independent contractors, and of course, there is always the risk of watching the company you work for go under right along with the stock you hold in it.
Short term traders often find that their risk tolerance is really quite high, as is their level of excitement. The profits are big when they hit and the losses are just as large. But the short term trader is out there having a blast, feeling his or her adrenaline rush at least a few times a day and tolerating risk factors that not all of us can really handle.
Assessing your risk tolerance is part of knowing whether you are in this deal for excitement or if you want a little more security. If you really can’t handle the thought of loss at all, then you should be putting your money in a twelve month CD. Outside of that, anything you do is guaranteed to fluctuate. Part of whether or not you are willing to look beyond the bank’s CD rate is the attitude you have regarding money, tight times, and how much security you really need.
These attitudes are usually developed during our formative and primary years. If there was never enough money to go around, as adults we often need more security unless a parent was able to impart the wisdom that with the right attitude, the money will be there when you really need it to be. For some who grew up in wealthy but dysfunctional homes, money means very little. Whatever your attitudes about money and security might be, you stand to gain a great deal by evaluating where you developed your feelings about money, whether you believe they are healthy feelings or need a little tweaking, and how much you’re going to allow that to affect your daily transactions.
Once you understand your level of need for security you can then determine what you need to do to change your attitudes you would like to dump and what you should do in order to maintain a healthy work attitude. People often admit that after examining this aspect of their life they manage to shake a pretty dreary cloud that once hung over them and move forward with a sense of freedom. Creative approaches to money can often help reshape your security needs.
Unfortunately, some children grew up without any security, whether it was emotional or physical or financial. There was no security in any aspect of their lives, and this has led them feeling like there isn’t much security as an adult. This is a highly disconcerting way to enter the world of trading and that lack of feeling secure can lead to high risk behaviors (if nothing is secure why try to maintain anything, right?) or to incredible deliberate and excruciating executions (if there is no security then why take even a mild risk?)
If you don’t feel secure at all, it would most definitely be in your best interest to find a way to work through it. Fortunately, since we are individuals built with an innate ability to choose what we want to change. Finding security or redeveloping the “rules” we were taught as children can be liberating in more ways than just financial.
As adults, we have an obligation to ourselves to find the answers that are right for us, that enable us to become better people, better traders, and more confident individuals. No matter what you do in life, finding new viewpoints creates a growing process that can only benefit you in the long run, even if you only trade for a year. Some people are able to find these conclusions on their own and others need some more help to get there. Of course, you will do what you want to do for your life and your trading career. Personal development is part of developing that awesome trader that exists inside of you. If you aren’t growing and changing a little, then you aren’t developing into the trader (or person) you have the capacity to become.