Gambling vs. Trading is there really a difference?
For years & years, many will spin their wheels throwing hard-earned money into the wind. At some point, bias crept in, allowing them to have some big wins to recover losses. But did that help or create a terrible addiction to "hitting big"?
Dopamine hits are cheaper than ever. You pull up youtube and can watch any video you want. Tik Tik, shorts, Instagram heck any streaming media you wish to insert here is the cheapest dopamine you can buy. While all of this is happening you are rewiring your neural pathways. You need cheaper & cheaper dopamine while being addicted at the same time to the rush it brings. Most will never know this is taking place, they have no idea that their actual pathways are being rewired this way until it is too late. However, if you are reading this article it isn't too late!
So the question of the night is, are you addicted to gambling? I will be speaking on the topic of trading & investing here.
Almost all traders go through a series of ups & downs. Losing or winning, winning or losing, maybe a combination of them all. Those who want to stay in the game will likely spend countless hours pouring their lives over charts, videos, and technical analysis figuring out how they can hack the game. The hardest thing here is that your soil has never properly been tended to. Let's picture a redwood tree for a minute that grows hundreds of feet tall and produces some of the most beautiful forests in the world. It takes decades of growth for this to happen. The soil must be great, and the environment just right for all of this to happen. The tree itself doesn't have to try any harder yesterday than it did today and then it will tomorrow in order to grow. It understands that the "Laws of Nature" are a perfect being. If you plant in fertile soil, with clear intention, and keep the environment amazing things must happen.
So why as traders do we self-sabotage? This question is an entirely different post but I will be happy to cover it down the road. Gambling though... We love it huh. The idea of putting $20 in and making $100 or as traders the idea of putting $25,000 into a stock with hopes of that stock waking up to news and gaping 100%+. You pull out your $25,000 and are happily on your way. But does this happen all the time? Many different factors are at play and do play out.
Let's say for example you have found some success. You turned $10,000 into $50,000 and are working your way to $100,000+. This happened during a hot market and you could take whatever trade you saw fit. You had an idea, you placed the trade and within days you found yourself happily in the green and making $$$. But all of a sudden stuff stops working. You have started to size up because you are a "better trader" now but the old wins aren't happening like they once did. Gappers are smaller, the tape isn't getting continued moves, traders are preaching the world is ending blah blah blah. So what do you do? It would only make sense that we look for a trade we can size into even more than that used to gap big like the olden days... And here we are. Enter Mr. Gambler.
As the market shifts, surges, digests, consolidates, and distributes you must be a leaf in the tornado or better yet a wave in the ethos of the ocean. 99% of traders who enter this business approach the market from the wrong perspective. Risk Management is at the back of their minds and they care not to even bring up the subject. Big losses are never mentioned, blow-ups are a right of passage. All of these are stupid as fuck if you ask me. There should never be a trade that isn't structured... Why would you take that trade? You have no deal in place, no profit zone to pay yourself, no stop zone to manage risk if needed. You are throwing darts with money attached hoping that something will stick to the wall.
The trickiest part is that as the tape & environment change as they always do, you must also change with the times. The hardest bit is 99% of people who enter this battleground are addicted to cheap hits. You want the 100% mover so you continue to leverage your portfolio into subpar trades. The dopamine hit after dopamine hit early on tricked your brain into thinking you can do this your entire career, and for a long time, you will actually be able to pull it off. Continuing to reinforce the notion even more. But with each failed move you start to lose faith but you know anything is possible... You have no plan, no data, no expected return/outcome but you do have your trusty addiction to gambling your future.
All of this might relate or maybe it doesn't. If you have learned that data data data is your best and closest friend than please feel free to close this blog or share it with friends! But for those who still find themselves blowing up really take some time to sit with yourself & your account. Look at your trades and why you held a bag? Why did you allow yourself to blow up? Did you have a deal in place? Did you take profits or move stops to protect from the downside? More so than anything else, did you gamble?
I write this piece as an ex-addict...
Hi, My name is Herc and I am addicted to gambling.
It took me many moons to work through these issues. Years & decades of psychological trauma and BS that I never knew was at play. I was trying to have big wins to prove myself to friends, family, and myself. But at the end of the day, it proved nothing. I was no happier when I finally "made it" than I was when I was looking at my bank with less than $1,000 in it saying if you don't succeed you need to get a real job.
If you are serious about your future though I implore you to look upon yourself. Look upon your trading and become a motherfucker about really taking the time to look at everything.
Are you gambling with your life?
Are you gambling with your time?
Are you gambling with your trading?
Are you gambling with your health?
Are you gambling with your future?
Most have no idea they are gambling with everything. There is no structure, there is no responsibility for anything. If you need help please reach out! I have been there, many others have been in the same situation but it isn't until you get really serious about yourself that you will change. Gambling is one of the most debilitating addictions you can have because you don't realize you are doing it. You simply wake up years down the road and have nothing left. Cheap hits and small wins cloud your judgment against massive losses and thousands of paper cuts. You can talk yourself into anything knowing 1/1,000 will be a big win.
If you are holding bags... You are addicted to gambling
If you don't take profits... You are addicted to gambling
If you don't structure deals... You are addicted to gambling
If you don't stop... You are addicted to gambling
At the end of the day, I could go on for hours or days about this topic. I will keep it brief and finish here. My friends if any of those resonates with you I implore you to take some time off trading. Really look at your recent wins or losses over the past year. How much was structured vs. how much was gambling? What was the win rate, and timeframe, all of it be more thorough than you have ever been. Being an addict isn't the end, it is simply the beginning. There is ample time to restart and reinvent yourself into the person you wish to be but that means taking responsibility for the person you have been.
Stop Gambling!
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