Managing a winning trade is an aspect of trading psychology that doesn’t garner as much attention as accepting loss or managing FOMO.
This comparative lack has always been noticeable to me, as both an active trader and performance coach; I face this issue all the time. Do you book profits and potentially leave money on the table or do you hold and potentially see your unrealized gains evaporate?
This is a major issue; and how we handle this dilemma in any given trade has the potential to influence how we handle the next trade opportunity.
When a trader asks me for help in one specific area, solid results can often be seen rather quickly.
This is the case with one of my 1:1 coaching clients, who’s given me permission to use his name in order to share his experience.
I’ve known Trevor Harnett for many years. I was one of the first users of his MarketDelta service a long time ago. When he and his wife were visiting SF, my wife and I went to out to dinner with them.
Trevor has moved on since shutting down MarketDelta and has been focusing more on his trading.
Trevor has a long history as a trader, starting on the floor in Chicago, and successfully migrating to the screen. I’ve always had a lot of respect for Trevor, a solid trader (and a nice guy).
Earlier this year Trevor told me that he felt he was at a profit ceiling in his trading and he knew exactly what the problem was, he was jumping out of winning trades much to early. He asked for my help and became a 1:1 coaching client.
Knowing Trevor’s background as a floor trader, moving in and out of trades quickly, ‘scalping’; the first thing we did was address his personal trading history and how he became successful on the floor.
The fact that he is very good at the risk mgt. part of trading, and also very good at identifying opportunity gave me, the coach, a decent road map to start with.
I work differently with each client; my job as a coach is to ‘meet’ my client where they are and then bring them to where they want to be.
Without going into detail, I’ll share one of the things that really helped Trevor hold his winners longer. I showed him that we are trading one form of regret for another regret, especially when managing a winning trade. Regret, in one form or another, is pretty much inevitable. And it’s our reaction to this regret that makes the difference.
Not only that, we must also consciously be aware of what form of regret we will choose to experience. It’s an important aspect of what I consider to be a ‘psychological responsibility’ in trading – to be prepared for the emotional experience.
Part of my road map in planning my work with Trevor was to internalize this concept, which he did rather quickly. Trevor was able to use the psychological tools I gave him, and he ‘got it’ pretty quickly. I have to give Trevor a lot of credit for this, it’s because of his extensive experience and his ability to re-invent himself as a screen trader.
There were certainly other important things that also significantly helped Trevor, and I may blog about those things in another post.
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