In my years as a trader, I’ve found that almost all of the important lessons for successful trading also happen to be important lessons for successful living.
Traders must learn to control their emotions, release their egos, exercise discipline, let go of all biases, and see the big picture – just to name a few key lessons.
Another great trading lesson that should also be applied to your life is this: you can’t control what you can’t control.
Once you recognize the things you truly have no control over, it allows you to focus all your attention on what you CAN control.
As humans, we try to control every possible aspect of our lives. Think about this for a moment: most of the time, money, and effort we spend goes towards products, services, and activities that help us control as much of our future as we can.
But no matter how hard we try and how much money we spend, we can’t control EVERYTHING. And we’ll never be able to.
Now sure, we humans DO control more than we ever did before. Most people reading this article live in a democratic society where they have the freedom to make day-to-day choices as they please. For the most part, where you are right now in life IS a result of all those past choices.
But no matter how hard you try and how intelligent your choices are, you’ll never have COMPLETE control over your life.
Ironically, if you really think about it, none of us honestly want complete control. If we controlled everything, there’d be no surprises, nothing new to learn, no need for goals, no sense of achievement, no urge to expand, no wondering, no excitement, no fun, and no growth. There’d really be no PURPOSE to life.
When you admit that you’ll never be able to control everything in your life, you then need to honestly examine what you DO and DON’T control.
Life gets a whole lot easier when you do this.
As a trader, you first need to recognize the things you CAN’T control.
You can’t control earnings results, analyst upgrades and downgrades, overall market direction, flash crashes, jobs reports, the economy, and on and on this list could go.
In short, you have absolutely NO control over whether your stock goes up or down.
That’s painful for many to accept, but it’s the truth. And it’s an empowering truth.
The good news is this: recognizing what you DO have control over can make you a very wealthy trader.
There are just four things a trader can control:
1) The stocks he chooses to trade.
2) The price at which he chooses to enter a position.
3) The price at which he chooses to exit a position.
4) The amount of money he chooses to invest in each position.
That’s it. That’s all you, as a trader, truly have control over.
Once you realize that these are the only things you can control, it allows you to focus all your time and attention on these four choices. These choices will be the only thing that separates you from success and failure in trading.
You have to know exactly why you choose what you choose when it comes to these four crucial decisions. You have to be extremely disciplined in letting go of your emotions and you have to be completely focused on executing these decisions rationally.
Remember this the next time you find yourself overly fearful (or hopeful) about what the market might do next.
You can’t control what you can’t control, but you CAN control your reactions. And these reactions make all the difference.
* Need help deciding what to buy, when to buy, and when to sell? You can start trading the Darvas System today. To access the full portfolio of Darvas stocks – with EXACT buy points and sell points – check out the latest issue of Darvas Trader PRO by clicking here.