What Will You Be Doing Different to Succeed in 2019?
Over the first couple of weeks of the new year, many traders will be asking themselves, ‘what can they do different, better or more effectively in the coming year?’.
Most will be conscious that they need to break out of old repetitive habits and negative patterns of behaviours.
Unfortunately, most will end 2019 repeating the same challenging behaviours which stop them achieving their full potential and fully optimising the opportunities and ideas they identify.
Behavioural Change as a Goal
Behaviours and actions are the visible representation of aspects which are largely hidden deep beneath the surface of consciousness.
Changing and transforming behaviours is often the key to breaking through the invisible barriers which hold most people back.
Unfortunately, most conscious efforts to change behaviour usually waiver and fail as people sink back into deeply ingrained unconscious behavioural patterns.
No matter how smart, intelligent, knowledgeable and capable one is, it can be extremely difficult to break past self-limiting behaviours and deeply ingrained patterns.
Often, we are blind to the very thing we need to address. The presenting factors are rarely the cause of our challenges.
In addition, the repetition of unproductive behaviours can themself become the cause of anxiety and stress, further compounding people the challenge.
The consequences are that people place limits on their upside, stifle their growth, and fail to realise their full potential.
Improving Performance: The Trading Game.
In trading and investment, it is helpful to refer to the trading game as occurring within two domains.
Domain 1: The Outer Game of Trading
The ‘Outer Game’ is the tangible part of your trading where others can see what you are ‘doing’. The ‘Outer Game’ consists of three pillars of trading and investing practice.
- Strong and robust management of risks and capital.
- Ability to scan and analyse markets, data, news, events to find value.
- A system, method or approach which helps you monetise value.
Strength and ability in these 3 pillars are vital to trading success.
Domain 2: The Inner Game of Trading. The ‘Inner Game’ is the part that sits ‘beneath the surface’. – Out of sight and largely out of mind.
The Inner Game is the foundation rock that every person’s Outer Game is built upon.
The ‘House of Trading Mastery’ diagram below emphasises the Outer Game and Inner Game Metaphors.
To illuminate the Inner Game concept further, I want to bring in an additional metaphor; ‘The Iceberg Analogy’.
An iceberg is only visible above the surface yet 90% of it exists below the surface. It is what happens ‘below the surface’ which has a far greater impact on the iceberg’s existence, size, shape, buoyancy, character.
The ‘Below the Surface’ aspects of trading and investment include intangibles such as mindset, attitude, feelings, emotions, motivations, philosophy, values, beliefs, ego, anxiety, innate biases, etc.
These aspects affect and shape your habitual behaviours, impacting your decision-making, self-control, ability to remain objective, and a host of other aspects which impact your performance.
A strong ‘Inner game’ supports a far stronger and more effective ‘Outer Game’.
Developing your ‘Inner Game’.
To really start making a meaningful difference to your trading performance, development of your ‘Inner Game’ should be a top priority for the coming year.
However, there is big ‘But’.
The ‘But’ is that deliberate development of people’s Inner Game is incredibly difficult. – Most people do not know where to start, and thus they do not. – Consequently, they are confined to repeating the same behavioural patterns and habits they always have done.
Where people do make an effort, it is usually limited to reading about the behavioural or psychological aspects and trying to think their way to being different.
Unfortunately, this is akin to trying to cure a disease by reading about the symptoms and then thinking that knowledge of the symptoms will cure the disease.
Then there are the blindspots and the distorted mirror.
Our blindspots are of course ‘blind’ to us. We do not even know they exist. – I am sure you could think of plenty of blindspots your colleagues have that they themselves are unaware of. – Well I am afraid the same is almost certainly true the other way around.
The distorted mirror is the unreal representation we see when we reflect. As objective and impartial as we think we are, when it comes to assessing ourselves it is likely we see a poor facsimile of how we really are
Perhaps in this distorted mirror we may see ourselves in ways which falsely boost our confidence, and in other ways we may not give ourselves as much credit we deserve.
The consequence of all these aspects is that one’s ‘Outer Game’ is very unlikely to significantly improve if one cannot materially improve their ‘Inner Game’.
Inner Game Coaching
The most effective form of Inner Game development is coaching. Coaching is neither learning, training nor education. Rather it is a joint exploration of you as a trader and risk professional and your associated behaviours, beliefs, attitudes, mindset, etc.
The coaching awakens you as to how you are and how you be (Inner game). The aim being to help shape how you work so you can be more effective in what you do (Outer Game).
Awareness brings change: Change happens as a result of knowing yourself better, being more self-aware, understanding your context more coherently.
Inner Game Coaching is the most powerful catalyst for development of trading performance. It differs to skills-based coaching which tends to focus on the ‘Outer Game’ aspects such as method, analysis, style, etc.
In 2009 I chose to switch careers after nearly 25 years as a trader and became a coach. Since becoming a coach, I have worked with many hundreds of traders, investment professionals, managers and leaders.
Each person I coach has a different Inner Game challenge which is unique to themselves.
The coaching helps shine a light on the factors which pull the strings on a person’s trading decisions and actions.
The self-awareness and reflection this triggers, enables people to become more conscious in real time of their actions. This in turn enables them to start cultivating more effective and more productive behaviours.
Often adjustments happen unconsciously, which is far more powerful than conscious adjustment.
Inner Game development is not limited to Individual in trading roles. Whole businesses and teams can improve their Inner Game. In the past few years, our coaching has evolved to include working with business, groups and whole teams.
If you really want to start making meaningful change for yourself in 2019 that will have an impact well beyond 2019, then investing in Inner Game development is the way forward.
If you are interested to know more about Inner Game Development please feel free to enquire by emailing me at steven.goldstein@alpharcubed.com.
Inner Game Education beyond Coaching
It is one of my aims in 2019 to help to continue to educate, inform and develop people in these vital aspects of Trading and Investment Performance.
Social media and blogging.
The growth of my ‘Behavioural Trading’ Linkedin group (over 15,000 members) is testimony to people’s interest and fascination in this area. I will continue to post articles on this group and to share new articles on Linked in Twitter, as well as on the new AlphaRCubed Blog Page.
The podcast, the newsletter and the book.
I plan to commence a regular podcast which explores and discusses the many themes behind this fascinating aspect of trading and investment. I also aim to start newsletter and to continue writing articles on themes related to this vital aspect of trading performance. In addition, a book is in the pipeline. Once more details of these are available I will publish them on my website, twitter and linkedin.
If you enjoyed this article:
You may enjoy some of our other articles which explores a range of themes related to Human Performance and Behaviour in Financial Markets. This includes, ‘It’s Not the Market You Overcome, It’s Yourself‘ and other posts on our Articles Page.
