Pychological Law #13: You Attract What You Focus Your Attention Upon
It's interesting because I've been talking about this law for a long time, but it's recently attracted popular attention because of a DVD called the SECRET. The Secret was already a best selling DVD in Amazon, but that has been reinforced even more by discussions on the Larry King and Oprah shows. Wow..
So what's an example of the Secret as applied to trading. If you want to be right and you constantly focus on avoiding losses, you'll end up getting lots of losses. I can even explain how this works...I call it the Loss Trap. If you focus on avoiding loss, you'll get losses. What will happen is that when you get a loss, you won't get out at your stop level because you don't want a loss. So you'll hang on, hoping it will come back. And when the loss gets bigger, it becomes even harder to take, so you don't. And eventually when the loss becomes big enough, you become a long term investor and try to just ignore it. And generally, the more the loss grabs your attention, the bigger it will seem.
I had another example brought to my attention recently. I did some real estate deals that turned out badly. A small investment that was supposed to bring me a 25% return or better, started costing me 100% per year and as I got upset at that, its started costing 200%, And it wasn't like a trading investment where I could just get rid of it. The more money I lost in the deal, the more I'd get angry at the person who put me in the deal and the worse it seemed. And suddenly, I realized that my experience was part of the law of attraction. What I was focusing on...being a victim of a lousy partner... was what I was getting. As soon as I realized that, I started focusing on how lucky I was to be getting out of the investments and all the lessons I'd learned. Last weekend I got offers on two of the houses and was just told by my broker that there was a lot more interest in the remaining houses.
Bottom line... what you you focusing on as a trader? Whatever it is, that's what you are probably getting in your life. So start focusing on what you desire and be grateful for getting it. It's an amazing force and it works in trading just as much as every other area of your life.
Comments
Sorry but I dont agree with your real state example.
This is too much mysticism, thinking cant affect reality that is outside your control(like the market).
If it could the football teams with the bigger crowds would always win.
It will affect peoples perception of reality like the conspiracy theorists who always will come up with a excuse to keep their beliefs.
This is not to say thinking can't help to improve performance but the advocators of positive thinking act as if you could control uncontrollabe events.
When it works they will quickly pat themselves in the back when it doesnt they will have beliefs like 'this bad thing will probably help me on the long run'.
I say this because I had problems with heavy metal overload which makes you extremely paranoid about everything.
By these theories I should have been kidnapped and burried alive after having most of my body burned.
Nothing close to what my thinking was ever happened. From a empirical point of view is easy to look at the success of these theories and dismiss the failures. Whats the reability of the theory?
Posted by: Mark | February 23, 2007 10:49 AM
Yup, it works just as well as it does in every other area of our lives.
Which is to say not at all.
Mystical jibber jabber. If you want to say that when you treat people positively they will respond positively, fine. But don't delude yourself into believing that you can change reality by really, really, really wanting it so. That's a dangerous delusion in real life and it's a killer for traders. How many of the mythical 90% of failed traders really wanted to win? Where is "The Secret" (TM) for them?
Disappointing to see someone as well respected as you giving air time to this. You need work and discipline to make it as a trader and perhaps not even then. It's not as sexy as The Secret (TM) but at least it's honest.
Posted by: Tyro | February 23, 2007 02:44 PM
The virtues of positive thinking has been known for a very long time. Neuroscience recently has provided evidence that neural connections within the brain can be re-wired by changing our thoughts and thought patterns.
However, the marketing blitz that is The Secret focuses not on what neuroscience is revealing, but on some murky interpretation of a law of attraction based on the fact that negative and positive charges exist within atoms. That fact does not support extrapolating that proved knowledge onto a philosophy that says something that the facts do not even imply.
Stick to the knowledge provided by neuroscience, and you can apply proven knowledge to improve your life and not to a bunch of purveyors of unproven woo.
Posted by: Michelle B | February 23, 2007 08:04 PM
I think i would interpret Van's sharing as this: "look around now but don't look at anything with the colour green". Now, when you do that you will start to look at green first, only then you want to avoid it - because our brain cannot interpret a negative statment naturally. If it must, it will interpret what that thing IS first. I only learnt that from NLP recently. I think we just need to just focus on 'the method/building a good system', rather than 'dont lose money' You will dissociate automatically because you know it is your system that failed, not you...and you'll keep on improving that system instead... I learnt that from Tom Basso's interviews. And this guy managed millions in his fund! :)
Posted by: J.N. | February 24, 2007 12:34 AM
home games always have a better winning ratio for teams in any sport.
the winning ratio is not 100%, obviously..., but home games statistics are always better then away games, in any sport, everywhere.
and probably mark, wich gave such a skeptic comment, was so focusing his attention on denying the law of attraction, that he could not see he was giving a great example of it... !
Posted by: daniel | March 4, 2007 09:30 AM