Two types of traders inside us

By | Investing

(Excerpt from Think & Trade Like a Champion by Mark Minervini)

There are two types of traders inside you and me and everyone. One I call the builder— disciplined and process-driven. The builder is focused on procedure and perfecting the method. The builder trusts that the results will come if he gets the process right. Mistakes are viewed as teachers, constantly providing valuable lessons in a continuous feedback loop. When the builder makes a mistake, it’s taken as encouragement: That’s one I won’t make again. Ever optimistic, the builder looks forward to the day when results are achieved—good or bad—because the process is constantly being improved.

The other trader is what I call the wrecking ball. Ego-driven, the wrecking ball is fixated on results; if they don’t come right away, he gets discouraged. If a mistake is made, the wrecking ball beats up on himself or looks for someone or something else to blame. If a strategy doesn’t produce winning results quickly or it goes through a difficult period, the wrecking ball tosses it aside and looks for a new strategy, never really committing to the process. A wrecking ball, as you might guess, has tons of excuses and rarely takes ownership of the outcome—and as a result, never builds anything lasting or wonderful.

You are not one or the other. You have both the builder and the wrecking ball inside you, just as every human being has the capacity for love and compassion, and also for hatred and harm. So, which one is going to determine your results: the builder or the wrecking ball?

… I consider myself to be an enlightened trader. First, I recognize that I have both the builder and the wrecking ball within me. But, I choose to feed the builder and starve the wrecking ball. To be mindful of this daily is even more important than a strategy or the mechanics of trading. Because even a good strategy will do you no good if you feed the wrecking ball.

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