Friday, February 08, 2008

Leadership, Happiness, Frustration, and Motivation: Being Your Own Best Trading Coach

An interesting study suggests that leadership (or a lack of leadership) has an effect on workplace performance, but the effect is indirect. Positive leadership generates optimism among workers, which in turn leads to higher productivity. Negative leadership yields frustration, which reduces productivity. While leadership is thus important, what matters in the end is the mood of the workplace: optimism vs. frustration.

The implications for trading are profound. When we're trading, we are also serving as our own trading coaches. How we prepare for the day, handle winning and losing trades, and review our performance are ways in which we exercise self-leadership. If the leadership of our own trading careers yields frustration, the result is apt to be reduced performance. If we lead our growth and generate an ongoing sense of optimism, we're most likely to have productive market experiences.

How do you talk with yourself when you make money, but not as much as you would have liked? How do you talk with yourself when you lose money? How do you talk with yourself when you miss a solid trading opportunity? Our self talk *is* our self-management. If the way you talk to you would bring frustration if someone else used those same words to you, then you know you need to work on being a good (self) manager. What we feel while trading is a function of self-talk and how we exercise leadership over our trading careers.


Changing Your Self Talk