Trading Pschology - The Battle Between the Individual and the Group

[Passiontrader]

Every trader behaves in accordance to their own emotional makeup. Fear, Greed, Hope and Regret drives trading behavior. We all know them! Trading the markets is a battle. The ups and downs are inevitable! Our mindset before, during, and after each battle needs to be correct. There are many discussions regarding on how to eliminate emotions with trading plans/trading systems and I have participated in my share. Some of the aspects include discipline, risk management, etc... but one behavioral perspective not talked about a lot is that people love to join groups and act like everyone else. Herd mentality... It's such behavior that can cloud your mind. It's human nature! How do you Traders eliminate that behavior or combat that in your trading?? All opinions welcome!

 

[Glastonburyk]

As long as you are trading within your rules and strategy who cares what others think

 

[pashaev]

If there is such a weakness, need to limit access to the study of someone else’s opinion.

 

[fxoday]

I think we only need to trade with our own selves, if likely scalping makes high emotion pressure, we can try to use intraday strategy,
in another word we use strategy that makes comfortable for own selves, trading with plan and only spent money that afford to lose is my rules

 

[Passiontrader]

My perspective is based on short to midterm position trading. I find that if once I put on a trade and I’m watching prices non stop, I’m being sucked into the group. If I’m happy or sad based on a winning or losing trade I’m being sucked into the group. Making impulsive trades based on what prices are doing, I’m being sucked into the group… and I lose my independence! Groups can be powerful in nature and be responsible for massive trends so it would be beneficial to ride the coattails… but, when it comes to Turning Points, the remaining group gets Crushed. So it would be of utmost importance to analyze the group but think Independently of the group and know your Entrances and Exits! Like the song goes, “Know when to hold them, know when to fold them” … And then there is the Contrarian. If everyone else is doing it then it is wise to do the opposite… but you have to identify if the crowd has gone too far in one direction, measuring if too bullish or too bearish. These are generally the turning points. Certainly it would help if one has deep pockets to absorb risk like a Warren Buffet deep pockets. Basically if there are a greater number of Bulls the greater the risk of market decline. The more Bears that exist the bigger the upside.

 

[georgequayle]

Every trader behaves in accordance to their own emotional makeup. Fear, Greed, Hope and Regret drives trading behavior. We all know them! Trading the markets is a battle. The ups and downs are inevitable! Our mindset before, during, and after each battle needs to be correct. There are many discussions regarding on how to eliminate emotions with trading plans/trading systems and I have participated in my share. Some of the aspects include discipline, risk management, etc... but one behavioral perspective not talked about a lot is that people love to join groups and act like everyone else. Herd mentality... It's such behavior that can cloud your mind. It's human nature! How do you Traders eliminate that behavior or combat that in your trading?? All opinions welcome!

cons to both

 

[Thoris]

It is clear that you can rely on the opinion of top traders or those who use a certain strategy, but you should not attach such a great importance to it, first of all you should take care to ensure normal conditions for yourself, otherwise no profit and confidence.

 

[Clay Davidson]

I do not see anything wrong with mentoring or working in a group, because a person needs a person, it is normal, not everyone can cope with all the difficulties, especially in the initial stages!

 

[Olieng38]

Of course, in trading you have to be yourself, and on whom can you basically shift the responsibility? Yes, you need to communicate with other traders, share, learn something new, but you still need to understand that you perform all the actions yourself and bear responsibility for them, that's how it works.

 

[Glastonburyk]

I do not see anything wrong with mentoring or working in a group, because a person needs a person, it is normal, not everyone can cope with all the difficulties, especially in the initial stages!

I think it’s always good to work as a team, many hands make light sork