What’s your market identity? 14 Jul. 15
For years I have struggled with making consistent profits in the market. As I am sure have scores of others. We do make some money every now and then but it is not quite so frequent or quite so much or even quite so consistent that one can stand back and say ‘the market has got my back’. And it is not until we can say that to ourselves (mind you, that is the only person you have to say it to, no one else matters), can we really call ourselves traders who can make a living from the market. It is the dream of many a trader to make a living out of the market. But very few are able to do so. My sense is that very few are willing to do so. Ability just comes later. The commitment to do that as an activity comes first.
In that context, identifying our market personality is very essential. I have found a few types. Foolers is one. They are among those that have been around for a while(5-10-15 years even) and now think that they have the market in their grasp. To some extent the long years does induce a sense of recognition about market moves and moods. But certainly not to the degree that is required for consistency. These people Fool themselves into thinking that they can make money out of the market. But most of them don’t. They just manage to survive. Their lack of success keeps them from building the belief. But their lack of abilities at anything else makes them remain in the markets hoping for a big kill one of these days. The next type is Doubters. In this list I include those who are willing to take some efforts at creating a skill. They learn either FA or TA and make attempts at applying those learnings in the market. Success is random because applications are random. Not realizing that faulty application is the problem, they begin to doubt their own craft, thinking often that there is always some thing else out there that is ‘working’ while they are just making these extra efforts and not really succeeding. Thus lack of commitment to their own craft will prevent them from succeeding consistently. The third category is something like Imposters. These are a set of people who have learnt their crafts very well and are even adept at applying them reasonably well. But they suffer from a sense of inadequacy about themselves, knowing that the market is a big place and their expertise is not so great after all. Thus they begin to suspect or second guess their own skills and success therefore eludes them. They are great when it comes to other people (like those who consult them) but fail when it comes to working their own money.
There are many others but I think I would have made the point about market identity. The key is that in all these identities, the belief is absent. You search for the personality type that I have mentioned here and you will not find it within you. What you will instead find are thoughts, emotions and feelings about the identity. What we really need is to get rid of that covering and address the market types. Building consistency requires us all to gather a personality type where we are one with what we are doing and not observing it from a distance. (That ‘saakshi-bhava’ is needed for something else, a different subject altogether!!) Look at your market identity and see if it is preventing you from the right kind of behaviour that is required for the market. Many times this may require you to consult to someone who is well aware of such matters. Market mentoring is all about this aspect. As trading for a living becomes more and more prevalent (as intermediation in the market is becoming steadily more difficult as a profession), the time for examining oneself is even more urgent. The cause of our consistency or lack thereof , lies within us. It is our responsibility to bring it out and make it work.