Loss and regret. The Source of the Pain is Not What You Think It Is
8 August 2022
Doing what you should do and not doing what you shouldn’t
8 August 2022
Why do trading losses hurt so much?
Dumb question.
Trading loses hurt because you wanted more money, you had more money, and now you’ve got less money (or none).
Your account is demolished, the screen is a sea of red. Your efforts have availed you worse than nothing; your dedication, enthusiasm and intentions have come to naught. If you’d relaxed and enjoyed yourself instead of trading, you’d be better off than you are now, after a sweaty, stubborn, white-knuckle trading session.
And all you want right now is your money back.
Some people can dust themselves off and move on to the next trade; others walk away, happily abandoning their trading dreams in favour of a project they are better suited to. But for many of us, losses trigger intense regret, and an obsession with getting even, and in so doing, we morph into a loss magnet.
I was in the second category, and these feelings plagued me for over a decade.
Get over it! Move on!
I knew I had to change, but I couldn’t. Everyone told me I had to get over the losses, and said as soon as I left trading behind, I’d be able to recover my former financial position. I knew this was possible. But I was already in the quick sand, so the more I struggled to escape, the more I fought against my situation, the greater the downward pull of the wet sand, into self-hatred and financial catastrophe.
A different way of thinking about things
We’re all familiar with that Einstein quote about how you can’t solve problems by going round and round in circles thinking the same old thoughts (most likely the same tedious thoughts that churned like clothes in a washing machine before the problem arose).
Mostly, our minds process what happens to us without too much trouble. But when we face something intensely threatening – like significant trading losses – the experience is too big to be processed by the mind. It doesn’t pass through consciousness; It gets stuck.
Imagine your perception of the event as a powerful camera flash inside your mind. If the flash faded into nothing once it was over, there wouldn’t be a problem, but it doesn’t. The bright light of the flash diminishes, but it stays illuminated.
The after-image that distorts your perception
The lasting impact of such an experience, is like this after-image of the flash.
This causes your mind will make errors in its perception of what happened back then, how much it matters, and what is happening now. These distortions in mind’s perception of past, present and future, can be approximately grouped as set out below.
? A facet of your mind is stuck in the past, back at the moment when you could have done nothing and kept your money, or sold/bought crypto/FX/Indices and banked profits.
➙ For this part of your mind – since it’s still in the past – it’s possible to not make this mistake.
➙ Not making the mistake means you avoid the experience that threatens your security and your sense of self-worth.
➙ The will to go back in the past and undo the mistake is a powerful force that drives all the regret, longing and ‘if only’.
➙ It’s preoccupying, and it’s exhausting, because your mind is trying to do the impossible.
? There is a confusion between what you’ve done and who you are.
➙ If your mind sees you and your money as identical to one another, if it ties your innate worth to trading success, and you’ve lost money, it will create emotions to protect identity, i.e. jealousy, blaming, shame, and anger.
? Your mind is telling you that a bad outcome means you are a bad a person; bad people have to be punished (suffer) to improve and become good.
➙ When mind sees the world through this lens, it will set about making you improve yourself in future by punishing you quite brutally now. From this paradoxical perspective, the worse you feel, the better. This is how self-hatred and a peculiar, magnetic attraction further destruction develop.
If it’s not the loss of money that’s hurting, what is it?
Mind in the past: A facet of mind, below conscious awareness, is still back there, back then, which means it believes it can stop you taking the action that caused the losses. It sets about doing this by creating powerful emotions such as loss, regret and shame.
Misunderstanding who you are: While the flash bulb effect might leave you feeling that the losses are overwhelming and subsume your previous accomplishments, this is not true. The loss is a blip in the ocean; you are far more than a trading loss and blown account.
Belief in the value of punishment: Bad people must be punished to make them good, and suffering is punishment. This is what we learn as small children, and when it’s still active in adulthood, it creates a lot of unnecessary pain and limitation.
Now for the good news: these are all processing errors.
By ‘processing error’ we are referring to the flashbulb that won’t switch off. What’s happened is still illuminated and active in mind, which means it’s affecting how you see the present. Once the flash bulb gets extinguished, your perception of past and present will be transformed.
Seeing things this way means that clearing this experience – and stopping it having an impact in future – is so much simpler. You do not need to change yourself, nor do you do not need to analyse why you did what you did; obsessive self-analysis is a cause of stuckness, so it cannot also be the cure (no matter how convincing and liberating those insights appear to be).
We don’t need you to love yourself or forgive yourself for the mistakes you’ve made and the damage done to your finances. I wasted years (I’m not exaggerating) believing I had to achieve these feats before I could move on.
How to fix the errors
We look at the true causes of the pain and address each one in turn.
Update the whole mind so that it stops creating the painful emotions to try and get you to not do what you’ve done.
★ Hypnosis –
★ Stories and metaphors –
★ Create new memories –
Shrink the experience and disconnect it from your identity
★ Hypnosis
★ NLP techniques that reprocess mental images, for example to fade and shrink them.
★ Sedona Method of releasing and letting go.
Move beyond the punishment/suffering loop
★ Stories and metaphors
★ Applying a scientific – rather than moralistic – perspective.
Effective treatment works by clearing the distortions in the way your mind is processing data. Once that is complete, the troublesome emotions clear, as if they have been washed down the drain.
