Last week was Masters week, and I’ve got golf on the brain. This got me thinking about the similarities between golf – one of my favorite sports – and trading. (And, no, “They are both frustrating as hell” is not one of them.)
Golf is an individual sport and trading is an individual occupation. When a golfer makes a bad shot, there isn’t anyone to blame except the person in the mirror. The same goes for trading. When a trader makes a mistake, the only one to blame is himself.
Notice that I said “mistake” instead of “losing trade.” Losing trades are part of this game. And, in fact, a losing trade isn’t necessarily a bad one. (Though, of course, a bad trade will more than likely be a losing trade.)
One thing I’ve noticed about my golf game is that if I make a bad shot and then let that shot linger in my head, my next shot is usually bad too. The same thing can happen in trading. If you make a bad trade, don’t dwell on it… because that can cause you to make another bad trade.
If you want to master golf or trading, you need to learn from your mistakes. But you’ve also got to move on without the mental baggage of the last shot or trade. Your game will thank you for it.[Ed. Note: Rick Pendergraft is a professional trader and market analyst. In Rick’s new investment service, he gives easy-to-follow, step-by-step advice that you can use to create consistent, automated income. Learn more about how he can help you produce explosive gains – no matter which way the market is trading – here.]