I have found that many of the lessons I have learned through trading apply extremely well into everyday life. I would just like to touch on the few that have really made profound changes in my daily behavior.
Discipline matters. Trading has taught me to be extremely disciplined. Many times that I am confronted with a problem, I will look to others for advice and guidance. In trading, you have to rely on your system’s rules to steer you in the correct direction. That is why I must adhere by my own trading rules. I do not have the opportunity to look to other places if I put myself into trouble. Additionally, the part of trading that requires the most discipline evolves around entry criteria. Just because you have available funds does not mean that it always has to be put into the markets. The hardest thing to do is wait for the perfect setup, having discipline helps. Just as in real life, money should not be spent just because you have it. Look how quickly some rich people can go bankrupt, that is a result of having no discipline. You have to be able to manage having a resource available and the intelligence to use it in a sustainable way.
Do not worry about what you can’t control. This may be the most profound difference that trading has had in my life. I remember when I first started trading I would have to watch the one minute charts to keep up to date with my positions. Every trader has had this experience. For some reason, it is comforting to watch a position as if it will really do anything. Now, once a trade has passed all my entry criterion, the trade is simply executed followed by a stop put into place. At this point in time the trade is virtually out of my hands. I just have to let the market take its course of action; I am just along for the ride. This relates very well to life. If you do everything you can control to the best of your abilities you should not have to worry about anything else. Intelligent people focus on what is important. That is, the actual decision-making process rather than what happens after that point.
Block out the noise. Learning to block out outside opinions is extremely important. Traders know that they do best when they focus on personal decisions. That is why I think my trading has improved now that I have a full-time job. It has helped distract me from the day in and day out market noise. For my trading style, noise is news and opinions. I do not have to think about Greece defaulting or when the Fed will increase rates, for my trading style it does not matter. I just have to block out everything and focus strictly on price action because price pays. I do not care why or how prices are going where they are going, I just go with the trend. Consequently in life, many people would live a better life by simply blocking out the noise created by other’s opinions. Focus on what you believe is important and you will get results. If you put in the time and effort, have strength in your convictions and do not let someone try to bring your ideas down. Do not worry about what people are thinking or saying about you because it does not matter. Lions do not lose sleep over the opinions of sheep.
In conclusion, trading skills are very interchangeable with everyday life skills. The three I like to stress the most are having discipline, focusing on what you can control and blocking out noise. If you can harness the power of these lessons your life will truly reap the benefits.