Tag Archives | emotions

Yoda Quote #4, “Fear…leads to suffering”

This is a continuation of the Trading Words of Wisdom By Yoda, for Quote #5 click here.

“Fear is the path to the dark side…fear leads to anger…anger leads to hate…hate leads to suffering.” -The Phantom Menace

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When young Anakin Skywalker is standing before the Jedi Council, we have no idea the of the dark, bitter creature he will become. Yoda does, though. Yoda senses something in Anakin that worries him: Anakin’s fear. Yoda’s early prediction came true as Anakin’s fears are realized and he becomes angry and hateful. In the end, though, we see that Anakin doesn’t have anger and hate to lift him anymore, he is just suffering.

As Traders, we can relate to Anakin’s fear of losses; we should always be aware of two dominating emotions: fear and greed.

Fear is a crucial response in humans to preserve both emotional and physical well-being. It works as a warning in our brain to show when something is dangerous or threatening. Most of us, however, fear uselessly and that fear holds us back. It’s natural for a trader’s fear to spike with the drop of a stock, or stomach clench when bad news comes from the market. Marie Curie, a physicist/chemist who was known for her pioneering research on radioactivity, adequately stated that “nothing in life is to be feared, it is only to be understood.” And explains, “Now is the time to understand more, so that we may fear less.” As traders, when we understand our fear and what causes it then we can either prevent it, prepare for it, or isolate it.

Greed can be just a devastating to traders. If you are too greedy then you will, as the old Wall Street saying goes, get slaughtered. None of us want to experience the humiliation of trying to squeeze every last tick out of winning position and getting blown out or whipsawed. For most of us, greed comes from an internal drive to get more and do better. Yet, success in the markets is based on a well-thought and calculated business plan, not those emotional impulses demanding more from yourself.

Take the time to develop a good trading plan that you trust enough that when these emotions rise, you are willing to stick to it. In the end, it feels a lot better to stand by your trading plan than to jump into destructive emotions like fear and greed. Eventually, fear and greed leave you, and your left to suffer the losses like the sad figure of Anakin Skywalker at the end of Return of The Jedi.

Happy Trading, and May The Force Be With You!

For Quote #3 click here.

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Yoda Quote #9 “Use Your Feelings”

This is a continuation of the Trading Words of Wisdom By Yoda, for Quote #10 click here.

9. “Use your feelings, Obi-Wan, and find him you will.” Revenge Of The Sith

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I know what you might be thinking, “but Master Yoda, we were told never to let our emotions control our trading!” And it’s true, you shouldn’t. We are told over and over again, DO NOT let your emotions control your trading; however, there’s an important difference between emotions and feelings.

*There is a lot of scientific controversy around this topic. If you would like to learn more, you can look up the science behind neuroplasticity and emotions/feelings. For this article, we are stating that there is a difference between emotion and feeling.

Emotions are universal feelings like happy, sad, anger, or frustration, and happen on the physical level (your heart rate increases or fist tightens). Feelings are a reaction or association in your brain to your emotions, and you can learn to master them. Think about the moment when your emotions are triggered. There’s a small gap of time before they translate into actions, within that gap you have the opportunity to discipline your feelings–in turn, directing your actions. Practice training your brain to recognize certain emotional triggers so you have command over what you’re feeling (Master Yoda wasn’t so crazy after all!). Now, when you find yourself in emotional or high-risk situations you can trust what you are feeling, consequently acting instead of reacting.

Happy Trading, and May The Force Be With You!

For Quote #8 click here

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