What is the Price of Success?
Recently I read a thread on a trading website where a trader asked others how their trading affected their relationship with work and with others. The trader did not detail his situation, but it was clear that work and relationships were taking a toll, apparently because of the trading. That could have been interpreted as a gambling problem or not; some traders are just so bent on success that they get tunnel vision, and block out everything else in their lives. And then they realize that while they may be making money, they are losing other things that were just as important.
Another trader contributing to the thread explained that he had everything he needed to succeed at trading: the system, the testing, the capital, the time—but not the discipline. So he struggled for years to achieve success, but still ended up falling flat and not reaching his goals. In the meantime, he managed to lose his girlfriend, and other aspects of his life also took a downturn. “When I started trading, I basically thought anything was worth the price of success,” he states in his response.
Whatever It Takes?
This “whatever it takes” attitude is very common among serious binary options newbies who really are hoping to make it over the long term. At first, it may sound like a laudable quality, and in some ways, it is. Determination is a key trait in successful people. But so is balance. And by definition, saying you will do “whatever it takes” to succeed at binary options trading is an imbalanced statement. It means that you will sacrifice anything to achieve one thing. But ask yourself, would the price be worth it if you no longer were happy? On a practical level, there are a lot of other more material things you risk when you are willing to do “whatever it takes”—even money.
Here are some aspects of your life you need to learn to balance with trading. Ask yourself if you really want to lose these things to turn a profit:
- Your job. Some new traders quit their jobs, thinking they will make a living trading overnight, only to lose everything. Others compromise their concentration at work or their relationships with co-workers and bosses because they are so caught up in trading. Remember, you are relying on your day job for the time being to help fund your trading and your life. Read some suggestions for balancing trading with a full time job.
- Your relationships. Are your relationships with family members or your significant other or friends suffering because of your trading? Do you spend all hours in front of the computer screen? Are you more committed to your account balance than your relationship balance? If so, you need to realize that these are the people who support you, and who you support, and they are depending on you not just to be profitable, but also to be there for them.
- Sleep. A common mistake for new traders is to sacrifice sleep for trading, because it is so tough to schedule trading around work. There are other answers, though. You can change the expiry times you work with, trade with your mobile device, or take other steps to schedule trading. Giving up sleep means compromising your concentration and health.
- Your health. Physical health and psychological health are both equally important for you as a functioning human being. You are doing neither yourself nor your trading any favors if you start giving up either for the sake of profit.
- Your money. Binary options is a form of investing, so yes, you will be putting money into this, and hopefully getting a lot more out. But you should be very careful about where you put your money. Research any trading systems, signal services, or brokers thoroughly before you commit, and do not jump system to system, paying out indefinitely in the search for perfection. That is not the road to success, only despair and loss.
- Your time. Each of us is only allotted so much of this, and how you spend your time is how you spend your life. You will be investing a lot of time into binary options if you want to succeed, but you will want to make sure you set aside time for your health, leisure, other commitments, and relationships.
Any time you make a major change to your life and start something new, you are inevitably taking risks with what you already have, because things will change. There is no steering around that, no running away from that fact. But you do not have to risk blindly, and you should always be asking yourself “Is the price of success worth it?” when you find yourself compromising too much on any one aspect of your life. Learn to take reasonable risks, and also how to stay accountable to yourself and to other important people in your life. Keep the lines of communication open, and you can learn how to balance trading with the rest of your obligations.
Do You Have the Courage to Win?
Are you getting ready to fund your first binary options account? If so, you hopefully have a plan in place for success. But ask yourself, do you really have the courage to win? Or do you only have the courage to lose? This may seem backwards, but it is actually a very reasonable question. A surprising number of binary options traders have the courage to lose a lot of money. Not nearly as many have the courage to win.
“But wait,” you may be thinking. “Why would winning take courage? Surely it is losing that requires courage, because losing is scary, and winning is not.” That is not true, however, because losing does not require as much courage to achieve. In fact, achieving losses while trading is effortless. Winning however means having the willingness to make difficult decisions. It means being ready to take the long road to success, even though you will have to put more effort in and you will not be able to expect instant results. Ask yourself the following questions:
- Am I willing to take things slowly? Do I have the courage to pursue binary options trading for years if need be to start becoming profitable? Or do I expect to win a ton of money overnight and quit? Impatience leads only to losses, but it is certainly easier than patience, which takes effort and discipline to cultivate.
- Do I have the courage to invest only 3% per trade? When you consider how long it will take you to get started with a small account wagering this tiny percentage on each of your trades, you can easily become daunted. But this is sound money management, and the principles do not change just because you are starting out with a small account. It takes audacity to stick with a money management plan when you are watching the amount in your account tick upwards at a crawl. This is why many traders with small accounts fail. They just do not have the resolve to continue on when they are making scarcely any money.
- Do I have the nerve not to trade emotionally or chase my losses? Think about how you will feel if you go on a losing streak. Will you have the strength of will to pull out of the market and go back to testing if necessary? Or will you chase your losses, risking more and more money and trading more aggressively to “win it all back?” This in effect is like playing Russian roulette with your savings—but a lot of traders find it much more difficult to simply let the losses rest, and proceed slowly to build back up their accounts.
- Do I have the willpower to work two jobs at once? Unless you are already rich and you are trading out of a massive pile of savings (unlikely), you are probably going to be working a full or part-time job while you are trading binary options. That means you will be working double time, and possibly for years. That is a huge commitment to make when you have no guarantees. But if you quit your day job, you will probably lose it all.
- Am I willing to admit to my mistakes? One of the toughest things about trading is how much honesty it requires. You have to be willing to admit to yourself when you make an error that costs your money, and not blame it on your broker or the market. Then you have to be willing to make positive changes. You also have to be ready to be accountable to your family, if others are depending on you to make ends meet.
Losing at binary options trading may be scary, but it does not require nearly the effort that winning does. It does not demand that you develop such traits as courage, perseverance, patience, consistency, discipline, and accountability. Nobody acquires those things overnight, and building character can be just as time consuming and challenging as learning the technical aspects of trading. Winning at binary options takes longer, and while the destination is rewarding, the journey itself is quite challenging.
Think about your own personal habits as a trader and ask yourself, “Am I brave enough to win? What could I be doing to trade better? Am I setting myself up to lose because part of me knows that losing is easier?” And if you have not opened your account yet, ask yourself if you are really ready before you invest your money. That does not mean you should hold off forever though; any new venture demands a leap of faith, and eventually you will have to take that leap, in full conscience of the road ahead.
Photo credits: Kabul province mountain