Thursday, April 20, 2006

A Trading Psychology Checklist

Note: The Web seminar for Woodie's CCI Club will be at 4 PM Central Time and is free for all participants. The link to the online room is on the CCI Club home page.

How do you know if your trading psychology problem is really just about trading or is a sign of larger problems? Here is a quick checklist:

A) Does your problem occur outside of trading? For instance, do you have temper and self-control problems at home or in other areas of life, such as gambling or excessive spending?

B) Has your problem predated your trading? Did you have similar emotional symptoms when you were young or before you began your trading career?

C) Does your problem spill over to other areas of your life? Does it affect your feelings about yourself, your overall motivation and happiness in life, and your effectiveness in your work and social lives?

D) Does your problem affect other people? Do you feel as though others with whom you work or live are impacted adversely by your problem? Have others asked you to get help?

E) Do you have a family history of emotional problems and/or substance use problems? Have others, particularly in your immediate family, had treated or untreated emotional problems?

If you answered "yes" to two or more of the above items, consider that you may not be alone. More than 10% of the population qualifies with a diagnosable problem of anxiety, depression, or substance abuse. Tweaking your trading will be of little help if the problem has a medical or psychological root. A professional consultation if you answered "yes" to two or more checklist items might be your best money management strategy.