05/24/2022
What is the "Value of Patience" when trading stocks.
We all take positions in any given stock with the intent of profiting when we exit our trades - we have our hearts set on the outcome. Based on "our pre-determined edge", we have an advantage, a better chance of succeeding & profiting than of selling at a loss. But still, nothing in life is guaranteed.
What happens next with so many new, inexperienced, or merely inconsistent traders is that they expect & want to profit the moment they take thier position, and when that doesn't occur quickly enough, fear, doubt, and finally despondency sets in.
They go from having an edge & confidently entering a trade to hopelessness which causes despair. And what do they do next? They panic & sell.
I know from my own experience what impatience & having expectations of the market when trading can do.
I'm certain that at least 70% of times I allowed doubt to creep in & then acted in haste and exited a trade prior to giving it time to play out, I actually exited what would have been "winning trades" if only I had waited just a bit longer. It made me realize, I lacked an essential trait that any successful trader/investor must have - I lacked patience. I had no tolerance.
Once I saw this, I realized how quickly we can allow ourselves to spiral down when what we want, what we expect is slow to come to fruition.
What I now know is this - Patience is crucial to being a consistency successful trader, and when we master the art of patience we no longer doubt or question our actions & abilities; just because something hasn't happened, doesn't mean it won't. Sometimes it just hasn't happen yet.
Next time this happens to you, and what you were hoping for (profit) is not immediately forthcoming, please take a step back and observe what's playing out in your trade before taking even a small loss & exiting. Just breathe!
Making hasty decisions is a common trait in persons with limited patience, but sometimes good things really do come to those who wait.
And as the saying goes, "To lose patience is to lose the battle." Patience may be bitter, but its fruit can be very sweet.
For me, lack of patience was my greatest hurdle. Since learning & mastering patience, I no longer require an immediate effect in my trades. I still fear losses, but I have learned to embrace profits.
And, as a bonus, my improved patience has been a great confidence builder also. I no longer doubt my initial gut instinct, for it is signal telling me that it already knows what my head hasn't yet figured out.
The bottom line - Having patience makes everything in life easier.
Without it, we will learn less, we will see less, we will feel less, we will hear less, and when applied to trading, we will profit less.
