Last week I was interviewed on a podcast called AlphaMind and we had an interesting discussion about market analysis, technical analysis, behavioral finance, and a lot about the mental game of trading and your mental state. This includes how you approach things, your routines and how you set yourself up for success mentally when you’re getting ready for the trading day.
After that interview, a quote came to mind by Carl Jung, which says:
“Your visions will be come clear only when you can look into your own heart. Who looks outside, dreams. Who looks inside, awakes.”
It struck me that we kept circling back to the theme of self-awareness. I was talking about how having market awareness and situational awareness was so important, but arguably what is more important is having self-awareness. Being comfortable with your own capabilities, weaknesses, and imperfections. There is an overconfidence, a bravado if you will, that comes along with investing just by its very nature.
What I have found is that the most successful investors are the ones who have an honest assessment of their own capabilities. They know what they do well and more importantly, they know what they struggle with. These individuals tend to surround themselves with routines, systems, and people, all of which will alleviate the potential negative impact of their weaknesses. They are compensating for their own challenges by surrounding themselves with people and resources who can help with those things.
We further discussed how to build self-awareness, which brought me back to my routine in the morning. Aside from the general daily hygiene tasks, I realized there are three things I try to do every day to build self-awareness.
Journaling
Prayer
Meditation
I have talked before about how I strive to write three pages in my journal every day and being in a routine of journaling. Prayer and meditation both have a similar effect as journaling does which is having an honest conversation with yourself, and being honest with you. This systematically calms down that voice inside your head and getting through all of the noise and negativity from beating yourself down about things. Also, this makes sure you have a good relationship with yourself by having an honest conversation.
My question to you: what do you do during the normal week, and what can you add to your playbook this week to help you have an honest conversation with yourself, and more importantly have a better relationship with yourself?
RR#6,
Dave
Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. Please see the Disclaimer page for full details.