Something for every type of traders to read.
Trading and Family: Getting it Together
August 6, 2000
<brandon> Looks like we are ready to go gang. Today we have a very special
guest, Robin Dayne, known as "The Trader's Coach". She has worked with some
of
the biggest and best traders out there, including yours truly, and has been
featured on CNBC Power Lunch, ABC News 20/20, TheStreet.com and most
recently in
Business Week. Her main focus is Level 2 training and the psychology of
trading, which explains her visit today where she will expand upon
relationships and how
they can effect trading. Thank you very much for taking the time to be with
us today.
<RobinDayne> Hi ALL I am delighted as always to be here in your chat room.
The topic of how relationships that are close to you have an impact on how
you
trade is very interesting as it can REALLY have an impact on ones trading
psychology. Let's get started. I have recently had many calls on regarding
the question,
"How do I deal with my wife, girlfriend or husband when it comes to my
trading?" I had a client who traded from home and his wife would come in to
see him trade
every hour on the hour like clockwork and she would ask "SO how are WE
doing?" Of course each time she did he would sure enough lose at the very
next trade.
So how do we fix these kinds of interruptions? First it is important to
understand why your significant other is doing this. Having compassion is
the first key. They
most likely don't understand what you are doing. They don't understand why
you may lose or that losing is part of the trading game. They don't
understand how
emotions can have such a HUGH impact on your success and they REALLY what to
help you but don't know how. Most of all they are lacking "certainty" and
second they don't know your RULES for how to support you in your trading.
So your first goal has to be working on creating certainty of YOUR trading.
To do
this you may want to sit them down and explain how your emotions are so
critical and that sometimes a trader can lose.
The goal is to have minimal losses and explain to them how you do that. Let
them know what your stop loss RULES are: how much you are willing to lose in
one
trade (max) and how much are you willing to lose in the day before you stop.
Tell them you strategy for getting back on track when you are off. You can
break a
losing pattern by changing your "body" in some way (walking, taking a break,
etc) anything that will change your thinking. First begin with getting out
of you chair
and moving. Next work to explain to your other half our RULES for support.
Tell them what specifically they can do to emotionally support you. Each
trader is
different. The one I spoke of earlier really didn't mind his wife coming in
but just not each hour. His new rule, since he would make money in the
morning and lose it
in the mid day, was to set up a time to stop to have lunch and get away from
the screen for awhile to spend time with his wife. Not only was he more
profitable and
didn't give back his winnings, it did several other things:
1) He stopped when he had identified when he was losing;
2) He made a better connection with his wife and
3) he broke an old non-profitable pattern;
4) She had more certainty in his trading and didn't "pick on him";
5) She felt included and now a part of his trading life;
6) The emotional pressure was reduced for him.
So many many things happened with the one simple change. Take a moment and
think to yourself how can this important person be supportive in my trading.
If
they did exactly what you wanted to support you what would that be?
Let me go through some other details on this topic. Remember the person,
whoever they are in your life, is there because they care about you. We all
need this. I
know this can be a touchy feely topic and guys have a tendency (sorry guys)
to just say things like: "I just need to be left alone," "Don't bug me."
They do what I
call the "Cave thing." To handle the problem they shut out the one person
who really cares for them. I have to say to you lady traders: you can fall
into the same
trap. Lady traders that do not get support for their man may be dealing with
the "Your stuff is not as important as my stuff because I am the bread
winner in the
family." Again, educating the other person in your life will increase their
certainty in what you are doing. It will allow them to be a part of what you
are doing. They
will feel included and this will do nothing but allow them to support you
and it will release the emotional pressure.
I am coaching a client now who is trading full-time for a living and when
the market turned recently in the early part of the year so did his trading.
He also had just
asked his girlfriend to get engaged and now she was off and beginning to
prepare for the wedding. He had lost so BIG right at the same time and she
would
approach him NOT knowing how to support him through this transition. She
would ask "Can we go here for the honeymoon" and "Can we spend this and
that...
"Well, between losing and her asking to spend more and more, he went into
MEGA overwhelm. He was ready to give up, cancel the wedding, and all he
wanted
was to give her the world. He was feeling....yes, the dreaded "inadequate."
I can't do it....I'm not good enough......I can't make it." The emotional
pressure was
almost to much to bare, so in coaching went went through:
1) How to get his trading back in track (I cal this the bunny slope
technique);
2) How does he tell her when and where to speak of the wedding plans
especially when MONEY is involved;
3) How can she be supportive in his trading;
4) How does she ask him (what words) about his trading
5) and when should she do this. He was not comfortable with her asking each
day, so they made a plan to talk about it at the end of the week.
6) To get back on track he was now tracking the number of winning trades
verses the number of losing trades working to improve his performance.
When he did this he noticed how much he was losing and it was to high in
comparison to his $ winning trades, so he also adjusted his stop loss rule
to make it a bit
tighter to fit his trading strategy. His percentages have dramatically gone
UP and he is using the Bunny Slope technique.
I guess you are wondering what the heck The Bunny Slope Technique is. Ok,
here goes: "Bonus time" Bunny Slope Techniques - Use when your trading goes
off. If
your trading goes off then you are most likely in a Losing "Pattern." We are
creatures of patterns.
1) Reduce your shares if you are trading large lots;
2) Go into demo mode if you have it for a short period of time to get your
comfort level and certainty back on track;
3) Re-set your daily goal for a number you absolutely positively KNOW you
can make;
4) Play this game: You must reach this goal for 5 days consistently;
5) The rule is if you hit the goal you can continue to trade......so if you
are on you can keep going;
6) If you hit the goal and than lose you must stop trading and LOCK in your
profits. It's like learning to ski you start on the "T" bar bunny slope and
you fall off 10
times just to get up the hill but the more you practice the better you get.
By 12 noon you are ready to take on the harder slope because this one is to
easy so you go
for it.
7) When you reach your goal each day and lock in profits it will build your
certainty enough so you can raise the bar. This trader who was getting
married re-set the
goal to 250 each day. He was making 1500 - 3000 prior but he was OFF. He did
this for 3-5 days and raised the bar to 500. In that time he had some really
great
days and one was 3600. His confidence was returning and he was getting back
on track. If you lose and do not make the goal you have to go back to square
one.
The key it to win win win, even if it's small. Psychologically you will
ALWAYS feel better the next day having won the day before. Losing day after
day will deflate
you. The bunny slope technique works and at first it may take you a week or
two to get back on track, then a few days to get back, and before you know
it, a few
hours. So let's go to your questions...
<--> hearing robin now, I can identify completely. My hubbie says he
supports me, but I think he still remembers my big loses in April and
doesn't trust me really.
What can I do?
<RobinDayne> Again, non-traders don't understand that losing is part of the
game. The best thing to do is ask him what he really thinks. I am a BIG
believer that
ASSUMING you know what he thinks maybe incorrect. Ask him straight out:
"What do you feel or think about my trading." Get the real scoop.
<--> How can I tell my wife that I really prefer to not be bugged or
bothered during my trading time. I prefer to stay focused without
interruptions. She always
takes this so negatively. She then reacts negatively and then I feel bad and
find it hard to get back focused on trading...
<RobinDayne> In this case she is feeling uncertain. Explain how important
she is to you. When you tell her she Bugs you it works in a negative way.
Instead tell her
what you would like her to do (tell her how she can support you) when she
DOES this in the correct way make a BIG deal about it. Thank her. Tell her
you love her
more for her supporting your needs. She will continue because that reaction
will make her happy and help her feel included.
<--> In a normal job, money isn't really an issue long term. Does this
"performance" issue ever go away in trading? Or will it always be like this?
<RobinDayne> It's not the money per say. It's how you related to money. Some
people get traumatized losing 300. Some feel the same emotional level at
losing
1000. The more you create certainty in your trading, the more making the
money becomes easy because you have a plan and know YOU. Trading brings to
the
surface ALL one's emotional baggage. When you get rid of the baggage lots of
great things change and you begin to trade with comfort. So YES, it gets
better.
Hang in there and don't PUSH your trading. It will come.
<--> My wife gets jealous because I end my trading day at 1pm pst and she
ends hers 6-7pst. How can I end this pattern of jealousy?
<RobinDayne> It sounds as if she may not be doing what she loves to do; that
a job is for the money. Ask her if she had the ideal job what would it be?
And how
can she get in the situation where going to any job is fun... no matter how
much time it takes. Supporting her needs too is important. Also tell her you
felt this jealousy
and you are REALLY working for BOTH of you to have a better life. Maybe you
can help her around the house more or get someone to come in and lighten her
load or treat her to a massage therapy session once a week... something that
supports her needs to feel better.
<--> Can you talk a little bit about feeling like you HAVE to trade?
<RobinDayne> This is called "Pushing" you are more interested in Playing the
game verses winning and there is more going on here than just feeling you
have to
trade. The feeling is if I don't get in I will miss this, as if it were the
last trade ever. Deal with reality and that is: if you "Push" and lose, you
will be out of the game.
Get smart. Only play to win. Think of playing baseball knowing you have 3
tricks. Do you swing at each ball? NO, you wait for a great pitch. Create a
game that
says you only have X number of trades for the day and stick to that rule.
Make it a must to stop when you reach it. Pushers tend to write lots of
tickets and those
charges can eat away your profits.
<--> Robin: My husband gives me a lot of space as far as trading goes, but I
find I tend to put too stringent of goals upon myself. I know every trader
has their own
rules and goals, but I think not being too hard on yourself takes some of
the pressure off and I actually enjoy myself more and my trading improves
also. Just my 2
cents......Attitude is everything :)
<brandon> Thank you Robin! Robin's Video set is available on her site,
www.thetraderscoach.com It is a power packed series which is available for
$249.95 until
Aug 20th, after which it goes up to $300. She also has a some new products
in the pipeline which sound very exciting. This includes the newly revised
Traders
Journal (6 months) that will be ready in a week or so and will cost $39.95.
At the Ontario Expo she will be introducing a new video set, "The On-Line
Trading
Essentials". This has 3 videos, #1 Starting out, #2 Mastering the Game, #3
the Psychological Edge. The room is now unmoderated and we can all openly
chat
<chipper> Is Robin taking advanced orders on her video set?
<RobinDayne> Yes, advanced ordering is now available by calling 603-882-0221
leave a massage and someone will be back to you within 48 hours
<ilga> Thanks, Robin!
<alex> tx robin
<tradess> thank you Robin
<alrolarry> Great points, thanks Robin
<gneissguy> thx Robin
<RobinDayne> you are all very welcome I LOVE this business and my goal is to
empower as many traders as possible to succeed
<Toni> OK guys.... I want to talk a bit here to the significant others. I
know most of you here are traders so you know what you go through but I also
know the
other side: What it's like to be the one with a trading partner. When
Brandon first started trading I was not the least involved in the markets
other than to harass him
=) First thing was, I had given him the funding to get started so I was
feeling: he has to succeed. Also, as most of you know, Brandon suffers from
severe migraines
which make a normal 9-5 job impossible to hold and I was still in school, so
money was a big deal. We needed to make enough to live on to support
ourselves and
I know a lot of traders we talk to now also have the same pressures, whether
they have a family to support or bills to pay. Really, it's something you
need to think
about before you get into trading: to have enough money set aside to live on
for 6 months or so to get going. And we had that, barely, but from the start
I was
concerned. It's not that I didn't trust him per se, but I like to be
conservative and I like to know FOR CERTAIN things will be ok and they will
work out, so the
uncertainty in trading was very stressful to me, who was the non-trader. I
just couldn't comprehend what Brandon was going through. I just knew we had
bills that
had to be paid cats to feed =) So.. I asked him, a lot: "How did you do
today? How are you doing? Are you up on the week? Do you think we'll be ok?"
Well... as
you can guess, this just added more friction and as the months passed, and
as I saw the account shrinking shrinking, it just got worse. So, eventually
we just sat
down and talked because not only was his trading a mess, but the uncertainty
and concerns were messing up our relationship as well. It was a really high
stress
household. Well, what we discovered was, although he was losing money, when
I was in class or not in the room and completely left him alone he was
doing. Ok,
not great, but he was making money, covering commissions and turning some
small gains.
It was really an uphill battle, something we still deal with, but now I have
gained confidence enough to leave him alone and it took me convincing myself
that I HAD
to leave him be for it to work for him. Really this didn't turn around until
I started trading myself though. That was when I started understanding what
he was going
through and started being able to relate. I found that when Brandon knew
what I was doing or asked me about a position I was in, it would inevitably
end up a
losing one because I would start to second guess myself. I would handle the
position wrong, get out too fast, or pass it over to begin with. One thing I
started
noticing on Brandon's trades was whenever I questioned him he messed up. I
wouldn't understand what he was doing so I would ask him "Why are you
shorting that
at support? Are you crazy?" that sort of thing. "Why do you like COMS? It's
had such a strong move already!" Doh!!! That was one he wanted in the letter
last
week. I hated it; didn't see it and told him so. Even though I did not
mention anything on the day it setup, he still had in the back of his mind
that I did not like it, so
he took like 1/2 when it went to exactly where he told me it would go. So
you see... it's an ongoing battle, something we have to deal with everyday.
One thing traders can do to help their spouses or sig. others is sit down
with them for a day. Explain how they trade. Even though I don't always know
what
Brandon is doing or agree with him I know that he does and that's what you
have to trust in now.
If the trader is new and just started trading this year or last you have
another issue. They may not know what they are doing yet. They may have
studied and know
the basics and do great paper trading but you don't have to deal with
emotions in paper trading the way to do actual trading. In actuality you
think about how you
have to pay the bills; you think about how you are going to support your
family and your lifestyle and you can even get to where you obsess over it
or your other half
does. So it makes you think about it more and really, to succeed, you have
to put those thoughts out of your head. You have to conquer those thoughts.
You have
to make one trade or even a series of trades not matter. This is what Robin
was talking about with her bunny slope. If you come into trading with all of
this emotional
baggage, you are going for the advanced slope when you just learned how to
put your skis on. So, you need to reduce your lot size, set small goals to
start with.
Don't raise them until they are well-met on a regular basis and you aren't
attached emotionally to the positions and to your account.
Let your other half know these things. Talk with them let them know what you
are going through. If they interrupt you during the day and it flusters you,
sit down and
address that with them. Put it so they can understand. It's like this:
Think of yourself as the guy that disarms bombs. You have to keep a cool
head a steady hand.
Now, think of your family and those closest to you being held hostage in
that building with that bomb YOU are trying to disarm. Do you think you can
remain as
collected? as calm? This is what a trader with a family who makes his living
trading is essentially doing and it's going to take time to overcome. So, to
those sig.
others out there reading this... This is what it is like. Now.. if I go up
to Brandon: So.. how's the bomb situation going? You know we have 8 cats
that are going
down with us if you screw up. Well, I don't think he will do well. I think
I better start praying. I may be exaggerating but this is what they are
going through when
they hear: "So, honey, how are you doing today?" So, that's a bit of my
experience... I leave brandon in the room with the bomb by himself now and
now it's not a
bomb to him. It's a box. He just has to hit the right buttons and cut the
right wires and he knows those wires. He sees them all the time. So anyway,
over time a
trader can learn to control his emotions or her emotions and make the things
that were dangerous less so, but it requires the help and support or your
other half. It
requires me saying: "Don't worry honey. You've handled situations like this
all the time. This one is no different. Take your time. I'm going to watch
" Much Ado
About Nothing." Join me when you are done.
<brandon> I think that Gimmie had some things to day then I will then we
will just open it up and all yap
<Gimmie> Well, I am married as well, and the pressure of my spouse while I
was learning was for me also a very big issue in my trading. At MTrader we
emphasize
a very slow and cautious learning process that begins with a paper trading
phase. While this is a good foundation to learn any method, I have yet to
meet anyone
who has been a real failure on paper. I was no exception as I began my
trading career. As I started out, making lots of "paper points", I made the
mistake of sharing
my gains enthusiastically with my husband, and multiplying my points by a
hypothetical 1000 shares. Obviously this got him pretty excited. BIG
MISTAKE. He was
bragging at work. We were planning that dream house in six months. Obviously
this creates an undue, and overwhelming, pressure once you go live. The
complications of executions and the inevitable rush of emotions that
accompany your first live trades is never quite expected in the capacity
that always seems to
arise.
My first few trades were losses. I was in shock. For a long time afterward
then, I sat frozen in fear, losing by default, so afraid of a loss, I didn't
even try. And all the
while I was dealing with guilt at not living up to my paper gains and fear
of disappointing others. And everyday that inevitable, supportive but eager,
what did you
make today.. Nothing ?? ..Uh no ...I'm still learning" And then of course
the guilt of not only not making money, but in fact still costing money,
when we also had bills
to pay, a baby, etc. I guess the morale of my story is to begin trading with
realistic expectations. Assume an educational phase that will cost in time
and fees, and a
few early losses as you begin going live. Realize that is normal, and make
that very clear to your spouse. Every career begins with a time of
education. I spent 5
years getting a degree that resulted in less wages than trading offers me
now.
You need to also be aware that this game is not gain gain gain. No one is
100%. It's more like 2 steps forward and 1 step back. Stops are a natural
part of doing
this business. Trading is also less consistent in income. We have times of
drought and times of rain. It is more like being self-employed, and you need
to factor that in.
As you make this career change then, it is important to sit down I feel with
your spouse and go over all the implications of a trading career and a
trading education.
They are sure to be more understanding the more they can see exactly what it
is you are doing so share as much as you can, like Toni so well said.
Because my
husband understands these issues, he then understands that I am not willing
to tell him daily totals. That puts undue pressure on me to perform and
creates the
opposite effect. Once he understood more about the trading game, he stopped
looking over my shoulder, asking me "Why didn't you just buy that one there,
and sell
it there?" as well. And my trading consequently improved. d
<brandon> I look at trading much as I would look at being say a doctor. To
be a doctor costs you a lot in time and money to get that income and with
out that cost
you wont become a doctor. Trading is the same thing. A good trader will make
what successful doctor will make. I too started trading after having much
success as
a "paper wizard." Toni loaned me the money to start trading with, and I had
the Dupont registry out you know and knew exactly which Porsche I was going
to get
and shortly after that I'd get that house on on the beach for her. I said
hey, give me 1 1/2 years we will be millionaires. I swear. I'm damn good
also, I had
experience in real life as I had worked at a grain elevator and was very
successful in running a hedge program for them. So, I knew how to trade but
trading your
own money its different and it causes a lot of stress.
Until Toni and I worked things out I did all kinds of dumb ass things to
figure out what kind of trader I truly am. I hung out in a free chat room
and took those
trades. Result: lost money. So I said, "Ok this guy sucks and I should short
his calls and buy his shorts. Result: lost money still. All the while I was
thinking, "Damn, I
better start making money. Gosh, I really want that 996, the blue one.
Someone is gonna buy it before I can you know. But my mind was all messed
up. I'd have a
gain of 1/8 and nail it. Wham!! See Toni, I made money today. Shut up now.
And really I took a huge risk to make that, so the next day I'd loose some
on a trade
and I'd think, "Oh god, she's gonna kill me. I gotta end at least flat. Oh
man. This is bad. Ok, oh god I'm down $500 dollars. Ok, if I just end up
down 375. Ok,
that won't be so bad 'cuz then I'm just flat from what I made yesterday.
That's not so bad." It went on like this until I had her cooperation and
support. It was very
very hard to trade but when I did slowly turned the corner. So that's what I
have to offer here. Any comments anyone has would be great as I think this
is one of the
most important subjects for traders so we can stay for as long as you guys
need.
<tradess> you guys really hit a nerve today
<brandon> good :) I hope it is helpful
<sunnyyy> very very good thanks
<Toni> You guys aren't alone... Just realize that.
<tradess> Yep, and one is always so careful not to start a discussion when
one really should
<Toni> Almost every couple involving a trader is going to have issues like
these at one point or another.
<Aikidoman> The only real issue I have is spending time with the wife, when
I need to spend time doing homework and scanning.
<Toni> oh boy....
<brandon> oh man That's a whole thing too.
<Aikidoman> What solutions do others have in creating balance?
<Toni> hehe
<brandon> LOL That's still I think the one thing Toni and I have issues
with.
<Toni> "Brandon... Get off the damned phone.. Stop talking about trading ..
it's what we do all day.. Come spend time with me!"
<brandon> Toni and I work together all day as well so I think maybe our
issues are a bit different than others may have but it's something that we
still need to work
on ourselves and find the right balance.
<Gimmie> My husband works 50-60 hours a week, but we work about the same
times of day, so we have breakfasts together, spend a couple hours talking,
and
make that our time.
<skunk> Hey I feel much better, knowing other people (everybody?) are having
these same issues :-)
<tradess> Me too, even better that we can work on this too.
<Toni> One of the things we try to do is designate times we spend together.
This is OUR time and we are going to do something non-trading related.
Brandon and I
try to do that every night we have at least one hour where we go hiking or
kayaking or watch a movie or even just walk around town or go out to dinner.
So.. a
few of you that talk to Brandon and night know it can get a bit upsetting to
me when I miss out on "our time" as we often bring work home afterhours and
Brandon
doesn't shut up once you get him on the phone lol. So that is one issue we
are still working through. These things can take a lot of time to resolve
and it takes both
partners and an understanding relationship and thus an open one. It takes an
effort to bring the other person into an understanding of what you do while
knowing that
they want the best for you. So the issue of spending time together, which
can be big, is one you also need to talk about and MAKE DATES. Even if you
are
married MAKE A DATE where you get away from your computer and go do
something you both enjoy be creative... Do something new. Make one day a
week or
even just half a day when you get away from trading and go do something else
your spouse will enjoy as well. Go camping, go play pool, go horseback
riding, go
bowl, but get out and do something together. I know finding time is hard,
esp. when trading often requires a lot of time at night and that is
something they may not
understand. The market is closed after all and they worked all day so have
have nights together with you. So, if that is the case, start your scanning
right after the
market closes. Do as much as you can before they get home. I know if you are
like me, you like a break after the close. So take 30 minutes or an hour and
then
work some or just work an extra 30 min. or so after and that is that much
less you will have to do later. Just make the effort where you stay 'til 5
est instead of 4 at
the computer getting things done.
<Gimmie> If all else fails, teach your partner to trade too.
<brandon> Just take care of your relationships. The market isn't your lover.
I know a lot of divorced traders who thought for a time it was but now
regret that.
<Toni> Ok folks. That's a lot of what I wanted to cover, so if you have
anything to add, please do so.
<ccap> Thanks Toni and Brandon, for this session and your comments. As
always I am impressed by your generosity and desire to help us!
<Toni> Thank you ccap I hope guys found some info today you can use please,
if your other half could not make it today let them read the transcript
which I will be
sending out. |
