How You Love is How You Trade

How you behave in an intimate relationship is exactly how you behave in financial markets, for good or for worse. The market demands of a trader the same things a loving, intimate relationship does.

Someone who loves you will demand your commitment, and so do the markets. A person who loves you will demand you be committed to them exclusively, and also to the relationship by being in it for the long term. Markets are the same; they need a trader to commit to their view, and be committed to trading in the long-term. A bad trader cannot commit to a view and is primarily looking for short-term gains. When a trader commits to his lover, he seals his fate to hers, and every move she makes affects his future. This is the same position he finds himself in when he commits to a view and to the life of a trader generally.

Love and trading require one’s keenest attention. That’s because lovers and markets don’t reveal their hands so easily. You have to do a bit of guessing and reading between the lines, and you could be totally wrong. Mercifully, in both arenas, there are feedback loops that allow the trader to calibrate their thinking as quickly as possible provided they have an open mind, are willing to be wrong, and are flexible.

Both require the trader to take part full-time. The less time a trader gives in either, the more difficult things are for them. It is not that one needs to spend all their time on the relationship or in the markets, but both demand to be prioritized such that the trader is willing to drop other things instantly if needed.

A person who loves you wants you to make decisions that are good for you. They want you to take care of yourself. So a good lover must be good at making decisions that are good for them, for the sake of the person who loves them. Good trading requires that a trader makes decisions that are good for them too. Most traders don’t feel this way. Most traders feel as though the market wants to take all their money, so it wants them to make poor decisions. But think of the market as a benevolent being who only wants you to make as much money as possible, but they can’t do it for you, or give it to you for free. The only way for you to get the money is if you pick it up yourself by doing things right.

In an intimate relationship and in the markets, the trader’s emotions are at the mercy of the other who can have him swinging from excitement to frustration to exuberance to melancholy, in a very short time, and against his wishes. Both an intimate relationship and the markets require that a trader adapt to their moods and have the strength not to succumb to one’s weak emotions.

In a loving relationship and trading, you can’t be a petulant child. Whining, complaining, throwing fits, or acting impulsively have negative consequences. If the trader acts immaturely, the other may pull back and it will devastate him.

In the markets, just as in an intimate relationship, you can’t force your hand to get what you want. You have to woo, be patient, and wait to be bestowed upon. In both, no matter how much time you spend learning the other’s intricacies, and no matter how much you think you know them, they can still surprise you by doing something completely unexpected, which makes you realize there is still much more to learn.

In both arenas, if you do get wounded, you can’t be resentful. You have to get up the next day and continue to show the other love. If you are committed to the long term, you must learn to endure the bad days. In the markets, you have to accept that losses and setbacks are part of the deal.

The highs are ecstatic and the lows are debilitating. So much so that sometimes, you think of leaving for good, but you don’t because you can’t. Because your connection has grown with all the ups and downs. Both challenge you to grow and to be more resilient. They teach you patience, humility, and being open to the other.

There’s a lot I can say about this but I will keep it brief. I wanted to get you thinking.