Friday, January 13, 2017

Be the Person You Want to Become

Here's a very important psychological principle:  When you want to make a change, clearly identify your ideal self--the person you would like to become--and make a conscious effort to be that person in some way, in some measure every single day.

We expand our identity by taking on roles and, over time, having those roles become part of us.  When I met my wife, she had three children by a prior marriage.  I had never been in a father-like role in the past.  By taking on some (but far from all) of those responsibilities day after day, I gradually internalized the sense of being a father.  When we had two more children, I stepped into my responsibilities naturally and gladly.

Identity is something we internalize over time, and the feedback we receive from others when we're in a new role is an important part of that internalization.  Our life experience is constantly mirrored to us in our social interactions and that becomes part of who we are.

One change that many traders want to make is expanding their trading size and risk taking.  They have been trading small and prudently as they develop, but now is the time to take greater risk and pursue meaningful rewards.  How can traders make that transition?

We become bigger traders by gradually trading bigger:  by assuming that role each day.  In gradually bumping up the size of our positions, we gradually internalize the sense of being a bigger trader.  The gradual increases ensure that the resulting volatility of our P/L doesn't throw us for a loop, but are meaningful enough that we experience ourselves as growing.

We never talk ourselves into change.  Change is the internalization of consistent action.  When we assume a role, we potentially expand our identity.  Be the person you want to become in small measure every day, and before long, you'll experience the world as that ideal person.

Further Reading:  Five Keys to Making Life Changes