As always, I address those people who begin to walk with humility seeking to earn consistently in the financial markets, in the Stock Market. There is a period where one begins to know the theory:
- How should I read a graph?
- What kind of markets do I need to know to trade?
- What trading system do I use to know when to enter and exit
- How do I use the platform to enter my operations
- How do I open a simulated account?
- What kind of technical indicators do I use?
- How much time will I dedicate to operating?
- What goals will I achieve daily?
Ultimately what I name the logistics. What is necessary to operate. Let’s not allow this period of theoretical learning to be delayed, because it is easy to start reading books, attending courses and spending years learning technicalities about the stock market. This is fine if you want to dedicate yourself to teaching, but if you want to live on the Stock Market you must have a set of tools, not millions of tools. then you enter in the phase of practice, self-knowledge, discipline, you start trading in simulated. You have to make friends with your set-ups, with your signals, with your system: trust it.
In this new phase you should know that you have to review the results, know your statistics, take pictures and see if you advance or not. you have to try duplicate the moment you operate in simulated as if it were real: associate pleasure and pain. Otherwise, you could be operating robotically for many months, with mediocre results. This is one of the reasons why people win on simulated and lose their money when trading real. I firmly believe that the reason is because we do not associate pleasure and pain. Let me explain.
In trading it is easy to be deceived, it is easy to overtrade, overtrade (lots of trades), it is easy to erase losing trades from your mind and screen. I have done it many times, I have sabotaged myself. That’s why it’s important evaluate what we do with a cold method: can be a supervisor, an auditor, a coach, and/or associating pleasure and pain.
Several studies have been conducted on the psychological effects of rewards (pleasure) given to monkeys at random. For example, if we teach a monkey to do a task and regularly reward it each time it performs that task, the monkey quickly learns to associate a specific outcome with an effort. If we stop rewarding him when he does the task, the monkey will quickly stop doing it. He won’t waste his energy doing a thing that isn’t going to offer him any reward now.
However, the monkey’s response to reward deprivation is very different if we do it completely randomly rather than regularly. This is known as random rewards addiction. When we stop giving the reward, the monkey has no way of knowing whether or not it will be rewarded for doing the task. Every time he was rewarded by her in the past, the reward came as a surprise. Consequently, from the monkey’s perspective there is no reason to stop doing homework. The monkey continues to do it, even without being rewarded for doing it. Some will continue to do so indefinitely.
We are able to get used to random rewardsare linked to euphoric chemicals that are released in our brain when we have a pleasant surprise.
If a reward is random, we never know for sure if and when we are going to receive it. So it is not difficult to expend energy and resources in the hope of reviving that wonderful feeling of surprise. In fact, for many people, that can even become a dependency. On the other hand, when we expect a particular result and it does not come, we feel disappointed and unhappy. If we start over and get the same disappointing result, we are not likely to continue doing something that makes us suffer morally; does it ring true?
The problem with any dependency is that it leaves us in a state of “no choice”. Whatever its degree, our attention and efforts will be tailored to meet that dependency. The other possibilities that exist at a given moment to satisfy other needs (such as the need to trust ourselves, and not risk too many of our assets) are ignored or rejected. We feel incapable of acting in any other way than to satisfy this dependency. A reliance on random rewards is particularly annoying to traders, because it is a new source of resistance to the creation of the mindset that regularity engenders.
How to find out if we are advancing or not? How can I avoid dependency on random rewards? How can you have a mental structure oriented to winning regularity?
Maybe this game can help you. Do not forget to put it into practice when you have a reliable system, and many trades made. Do not put anxiety in the game, or in trading. I hope you like it and it helps you.