One of the roots of dissatisfaction is REGRET.
But what is regret?
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Simply put, it’s the cognitive dissonance you feel when you made choices you think you shouldn’t have made.
Cognitive dissonance refers to the discomfort that you feel when you hold on to two contradictory or mutually incompatible ideas or when your beliefs are not in harmony with what you do (or have done).
This “discomfort” is typically experienced as guilt, anger, frustration, embarrassment, and regret.
There are two types of regrets that plague the typical trader:
The first one is regretting that you actually followed your plan.
- You see XYZ jump 10 points after earnings and you regret not holding your position through the event.
- Your stop loss gets hit and you regret not exiting earlier.
- And so on.
The other one is regrets that typically show up when you fail to follow your plan.
Now, let’s cut to the chase… The first one is irrational and shouldn’t even be there to begin with. If you approach trading in such a way, and you entertain such thoughts, then you belong in a casino and you might benefit from reading into resources such as you’re able to find on Tech Today Info and other sites regarding the rise of online gambling and how you potentially earn some profit from it.
Sorry… I don’t mean to be demeaning, I just mean to open your mind a little bit.
The reality is that if you followed your plan, then you need not feel any regret. Your plan is there to give structure to your trading operations. It’s there to help you be more consistent in your behavior. Because let’s be clear, we can get quite irrational under certain conditions and without the plan, there’s no trading, only gambling.
But let’s see the other type of regret – the one born of compulsions as you attempt as best as you can to adhere to your plan.
The thing is, following your rules instead of your impulses creates discomforts in the body and the mind. It’s all natural. But you STILL have to do it. And insofar as you don’t, the stronger your experience of regret will be.
Self-awareness: A radical solution
Without self-awareness, you’ll end up going through trading on “autopilot” and that’s a fact.
Self-awareness helps you see your daily decisions more clearly, in the moment as they’re happening.
If you don’t develop this skill, fears, limiting beliefs, social pressures, conditioned and automatic behaviors are bound to take over! If not now, sooner or later.
How to develop self-awareness?
A mindfulness practice is the most effective way to build self-awareness and understand the nature of your mind, which is an effective way to help you consistently make choices that align with your trading plan.
I’m not going to go around in circles. Check out the Start Here page if you’re a new reader of this blog.
But going back to regrets, I want to help you understand something about it that I think will help you in letting go of it.
See, with regret, we’re taking something that happened in the past and we’re looking at it and judging it and evaluating it with the information we have in the present.
Inherently, regret isn’t all that bad. It wakes us up and brings our attention to something.
So it is useful.
But it’s important to know what we’re focusing on. Is our focus on the pain felt, or is it on the lesson?
Whatever it is that you regret doing, it already happened. And believe it or not, at that time, you were doing the best you could, with the kind of awareness and information that you had back then.
I’ll say that again: You were doing the best you could, with the information and the awareness that you had back then!
If you could have done better, you would have!
So, you’ve got to stop regretting whatever happened because you’re just beating yourself up and, in the present, it’s fear that’s going to shape up the actions you take in the markets. It’ll make you hesitate, crisp, inflexible, and you won’t be trading with your full potential.
So, how do you stop regretting?
Really ask yourself these two questions (and I encourage you to journal about this):
1. What did I learn from this experience?
2. What are the action steps I need to take?
And finally, Forgive Yourself.
I’m going to say it one last time: You REALLY did the best you could at that time. No need to beat the dead horse. When you can’t forgive yourself and you dwell in regrets, you can’t see what’s in front of you, and what lies ahead. Regret is a reactive state of living. And whenever you’re in that state, you’re trapped in a sort of hamster wheel.
In the future, you’ll make mistakes again. You’ll do things that you wish you didn’t do. But if you own the decisions you make, whatever their outcomes you’ll begin to approach your life with serenity and confidence. Because you’ll know that whatever the market ( or life) throws at you, they’re only lessons.
That’s why success is often referred to as a journey and not a destination. It’s because you are in a state of constant learning. So make sure to remember the lessons, but for your own sake, let go of the pain.