As if the last two months of 2007 weren't bad enough for many investors and traders, the start of 2008 hasn't proven to be any more promising. As the threat of a recession becomes more realistic with each trading day, Wall Street has opened the new year with one of its most disappointing starts ever.
So now that the expensive champagne and cognac have stopped flowing, all that investors are left with is their reality. For some, they can see a bright year of trading ahead, but for others, the holiday market "hangover" continues and so does their poor decision-making.
The Coach Will See You Now As a performance coach for traders, I have seen many of their pitfalls and problematic tendencies. These are especially apparent when markets are extremely
volatile and unpredictable.
Many investors and traders share a double-edged personality trait: They tend to be perfectionists who are afraid of failure. This allows them to be extremely analytical, focused and detail-oriented. However, on the flip side, they can also be extremely self-critical and their own worst enemy when it comes to making decisions under negative circumstances. They are never mentally or emotionally prepared for accepting loss, failure or being wrong.
In professional sports, there are many parallels to the trials and tribulations of investing and trading. Take the current unbeaten football team, the New England Patriots. The Patriots became immortalized in history this season by winning all 16 of their regular-season games. Often, they didn't just win -- they decimated their opponents and exemplified the word "perfection." But how can you learn from this winning team to improve the way you play the trading game?
