How The Best Loser Wins?
Managing Risk Beyond Conventional Wisdom
How The Best Loser Wins?
Judging from today’s title, you may be wondering…
Who in their right mind would want to be the Best Loser?
I prefer Wining! Don't you?
Here's the story...
Recently I've been trading. I've had great results (maybe too good?)
I was producing 10% gains — on average daily. Before I knew it, my account was up 200%.
Each week my confidence grew as I documented my trades and looked for ways to improve my strategy.
Last week, I was having another great week and Boom! — a 70% LOSS! 🤯
I went into the trade with a higher order and the market went the opposite way. I was overly confident and figured I’ll increase my position.
The market was bound to correct soon? (So I hoped!)
"Soon" never happened and before I knew it — $100's in losses grew to $1000's.
I felt awful and couldn’t watch any longer. I closed out my trades and took a long nap after that! LOL!
I was so focused on my strategy and technical analysis that I forgot the most important element? “Trading Psychology” — or in simpler terms, my "emotions".
Have you ever started a business, created a product or made an investment knowing in your mind it was a winner?
Did you know 95% of traders fail? I didn’t.
Also, 20% of new businesses fail during the first two years of being open. 45% during the first five years, and 65% during the first 10 years. Only 25% of new businesses make it to 15 years or more — Source: Investopedia.
Can we both agree that the odds are not in our favor?
I was in shock for a bit but I sought information on trading psychology books. One source led me to "The Best Loser Wins — Why Normal Thinking Never Wins the Trading Game" — by Tom Hougaard.
Tom stated that the “95%” allowed their emotions and pain to control their decision making. The “reptile brain” function or “fight or flight” protects us from perceived danger. Well in trading and entrepreneurship — that can hinder us!
The 5% expect “emotions” but do not run from the pain. They’ve learned to "flip the switch". Remember this: FEAR = Face Everything And Rise.
Tom mentioned three commands to recode your philosophy:
1. I assume I am wrong — until proven otherwise. (let the market prove me right) Makes it simpler to cut losses faster.
2. I expect to be uncomfortable.
3. I add when you subtract and I subtract when you add. (maximize your gains and cut your losses)
Tom put it best: “ Maybe the market continues higher. Perhaps it doesn't. It doesn't matter because the 5% are not shaped by the outcome, they are shaped by their continuous process. They understand if they focus on the process, the outcome will take care of itself. “
I’m excited to continue the journey because now I know — “The Best Loser Wins!”
Reflection: Imagine where you will be — by managing your risk and emotions?
See you at the top!
I don’t know exactly where you are on your journey, but I share words of encouragement, lessons learned, and ideas to help you grow your business.
If you find value here, please share this newsletter with a friend. Deal?
💻 In Today’s Edition
TP’s Marketing Lesson
TP’s AI Artwork
TP’s Tech Trends
TP’s AI Tool of the Week
💡 TP’s Marketing Lesson
Digital Marketing Trends 2023
1. On & Offline Marketing Realign
2. Gen Z "Enters the Chat"
3. TikTok Continues to Dominate
4. Emphasis on CX
5. Authenticity & Transparency
6. Integration of AI Tools
7. Podcast & Audio Marketing
8. Employee Advocates & Influencers
9. A Shift in SEO & Search
🎨 TP’s Inspired AI Art
PROMPT: Devise a logo with a man's silhouette, tears transformed into roots symbolizing the growth from sorrow, and a touch of muted tones to depict life's bitter experiences. Choose a silhouette style with earthy colors. Keywords: silhouette, roots, muted tones.
Silhouette Logo - Leonardo.ai
🤑💡 Biz Idea: eVTOL’s - The Next TESLA? - Watch
📈 TP’s Tech Trends
🤖 TP’s AI Tool of the Week
Text to Image (included Text) ( Ideogram)
Ideogram: Helping people become more creative...
Thank you for taking the time to read today's TechPreneur Newsletter. I hope the information was helpful and inspiring. As always, I'm here to support you in your business journey, so please don't hesitate to reach out to me on Twitter at @rudybanx Keep striving for success!
Until next time!
P.S. - share this newsletter with family and friends.