Trading isn’t just about money, the market can teach you some important life lessons as well.
Before I started trading I sucked with money. I’d worked in banks, managed accounting departments, read countless self-help money management type books, but nothing helped me manage my own personal finances…until I began trading.
But that’s not the only thing trading helped me with.
When I started trading I was introduced to a whole world of discipline that I never new existed, and here are the 5 things that helped me the most and the 5 ways that I think trading can help make you a better person.
1. It can help you focus
Losing money sucks. Trust me. I’ve lost a lot of it. And when you start to lose money you start to wake up, and pay attention. You want to know why you are losing money and you want to know what to do to stop it from happening.
That requires paying attention. That requires focus.
Were you the kid that sat in the back of class and goofed off? Well, when you start losing money, you will stop doing that. You will move to the front of the class and start paying attention to your professor, Mr. Market.
2. It can help you analyze
The market is about opportunity. To find out where the opportunity is you have to analyze the market and see how the different factors that move price are coming together and what you can do about it.
Over time, the more you trade and the more you study the markets, the more you will begin to see how the different factors influence each other. You won’t trade the news, but you will see how the market reacts to news. You won’t trade fundamentals, but you will see how the markets react to fundamentals.
If you really go deep into this, you will begin to backtest your methods and see how different price action events affect future price movement, and you will incorporate everything into your trading.
And when you are done, your mind will never look at opportunity quite the same way.
3. It can help you know yourself
Believe it or not, trading has a lot to do with your psychology. How you feel about your money. How you feel about yourself. How you feel about success. Your background. Your childhood. All of these factors come into play when you are trading the stock market.
At first you won’t believe it, but over time, if you’ve suffered through any type of losing streak (and you will), you will want to know WHY. And once you ask that question, you will inevitably come back to yourself and your own history.
Once you do that you will open up a whole inner world that you never knew existed.
4. It can help you respect money
I hate to break it to you, but it takes money to make money. And to make money and save money you have to respect money. And if you start trading the stock market you will begin respecting money soon enough.
Do you waste money on needless things? Do you have a long list of financial wants instead of needs? Are you bad at saving money? Do you throw your money at anything that moves in the market?
If you trade long enough you will learn to respect your money in ways that you never new possible. Because in the market, money is everything. And in trading, you need as much of it in your account as possible.
5. It can help you help others
Before I started trading I never thought I would one day have a blog that could help other people learn about the world of trading and the stock markets, and now here I am. Once you wake up to the possibility that you can manage your own money and what a powerful tool money can be, I have no doubt that you will want to help others achieve the same things.
You may come to the stock market because someone told you it was an easy way to make money. One you discover that’s not true, you’ll find that the stock market can teach you many other important life lessons. And if you learn those lessons then you may very well find yourself making money in the market soon enough.
Until next time…