Today, a good friend of mine working in trading at Falcon Management sent me a brilliant article analyzing one of the most critical elements of trading: failure. And how incredibly wonderful failure is. The article highlighted some of the most fundamental philosophies of fear that affect everyone: traders riding the uncertain waves of the capital markets, entrepreneurs riding the uncertain waves of the consumer markets, and people in general riding the uncertain waves of life.
“I grew up playing hockey at some of the highest levels. When I was very young, I would watch other players in practice and admire the ones who never fell down. As a kid, no one wanted to fall down, lose the puck, or make a mistake in practice. However, very soon I realized that the kids that fell down often ended up being the best players at the end of the season. I always worked hard in practice but began to understand that the only way I would fall down is to work harder and take myself OUT of my comfort zone, which naturally, can be scary. That set off a chain of events that helped shape everything in my life and always will. I would skate harder and harder in practice and made sure I fell down almost every practice. As long as I was falling down, I knew I was pushing myself out of my comfort zone, which meant I was growing and getting better. I then took that thought into games and realized that I had better change my way of thinking there, also. If I focus on the other team as the opponent, the best I will ever be is a little better than they are. If I focus on myself as the opponent, I will never stop growing and improving. Instead of being afraid to fail, I now understood that success is IMPOSSIBLE without some failure.
Most people are afraid of failure in any part of life, especially trading. You have to understand that failure does not happen TO YOU, it happens FOR YOU. It is an opportunity to grow. When you shift your mind and think this way, you will smile with each failure, knowing that you have just identified a flaw that needs to be corrected or removed. Adversity is scary in the moment, but it is always when we grow the most. How wonderful adversity and failure really are.”
The author goes on to highlight the point that fear is the root of almost all evils. It’s the thing that divides people, divides countries, “causing leaders to spill the blood of sons, daughters, brothers, and sisters.” Rich people are afraid of losing their wealth, poor people are afraid of going bankrupt, old people are afraid of dying, young people are afraid of not being successful by the time they die. Fear is the thing that “keeps people from enjoying the great adventure called life”. And ultimately, fear seems to be the thing that separates those who truly succeed from those who ‘do OK’, those who truly live from those who just get by.
When you look at anything that you can do in life, things never seem difficult when considered in isolation as actions without stakes. I would argue that anyone can make millions of dollars in a stock simulation game, score 30 points shooting practice shots from the 3-point line, and come up with incredible entrepreneurial ideas in the safety of their own homes. How many people can push the ‘buy’ button with $5 million worth of stocks, out of their own pocket, on the line? How many people can make a 3 point shot with seconds left on the shot clock and the NBA championships on the line? How many people can take their great entrepreneurial ideas and put their last dollar into the business, fully aware that they may get kicked out of their apartment next week? These are the people we look up to, not the countless others who say “pffft, Youtube, I thought of that in 1995.” The difference is fear, and the ability to overcome it when playing at the highest levels with the largest stakes in the world.
The question of how to overcome fear is probably a question we will never be able to answer perfectly. In many ways, it’s mind over matter. I point you to Barney’s quote from ‘How I Met Your Mother’ – “When I get sad, I stop being sad and be awesome instead.” As the author of the aforementioned article says, it also helps tremendously to think of failure as not something that happens to you, but for you. And at the end of the day, fear is an irrational thing because we really have nothing to lose at all – one life to live, and it all goes away at the end. So screw it, and just do it. I think Om from GigaOM put it extremely well (and I paraphrase here), “I don’t understand why people don’t try to do incredible things all the time. There’s no reset button on life, why would you not try to change the world?”
article for reference: http://www.tradingacademy.com/lessons/20110301/featured_article.htm