Key Points:
- Honest self-reflection on values helps align actions with long-term goals.
- Emotional intelligence, including awareness of guilt and shame, sharpens trading discipline.
- Cognitive defusion creates mental space between thoughts and actions, reducing emotional bias in trading.
Session Audio: Unavailable*
Summary:
This session highlights the importance of traders staying true to their values while acknowledging the inevitability of mistakes. Sean emphasizes the power of honesty and transparency when evaluating one’s trading performance. Recognizing when we fail to live up to our values can foster growth by making us aware of guilt and shame’s positive roles in keeping us grounded.
The discussion moves toward the emotional intelligence gap in trading, where many aspire to “beat the algos” instead of trading in a way that suits their psychology. Sean stresses the importance of understanding personal limits and aligning trading decisions with an optimal state of mind. Traders must defuse thoughts like, “I have to be perfect” or “I need to catch every opportunity,” and focus on consistent systems that reflect their best interests.
In response to a question on cognitive defusion, Sean clarifies that it’s about recognizing habitual negative self-talk, which may be rooted in feelings of inadequacy or imposter syndrome. By labeling these thoughts as mere mental events, traders can reduce their emotional hold over decision-making.
* I started the audio recording late, and then some of the discussion warranted not being shared publicly forever, so I decided to axe the audio.
An impactful quote from Sean: “I’ve never met anyone, who serves their values 24/7. Moother Teresa didnt, the Pope doesnt, dont sweat it. It’s about being conscious of when you’re not, and learning from it.”
C.L.E.A.R. Mindset Connections
Connect to the present moment and enhance your self-awareness with practical techniques.
- Sean urges traders to reflect on whether trading aligns with their values, prompting them to be mindful of their behavior in real time.
Loosen your attachment to thoughts and emotions, and cultivate mental clarity and resilience.
- The practice of defusion is highlighted as essential to noticing and detaching from negative thought patterns, allowing clearer, more objective trading decisions.
Embody your core values and align them with your actions to foster authenticity and purpose.
- Sean encourages daily reflection on how traders serve their values, such as respecting stops and maintaining an optimal trading mindset.
Accept all the present moment offers, whether wanted or not, and find peace and strength.
- Instead of avoiding guilt or frustration, Sean reminds the group that these emotions can offer valuable insights and help prevent impulsive trading.
Respond with decisive, informed action, transforming challenges into opportunities for growth.
- By focusing on psychological flexibility and being willing to question bias (such as short vs. long), traders can adapt more effectively to market conditions.
Actionable Strategies:
- Regularly review trades with honest self-reflection, noting successes and where values were compromised.
- Practice cognitive defusion by recognizing and labeling negative self-talk, reducing its power over decisions.
- Take scheduled breaks from trading to reset mentally and prevent emotional exhaustion.
- Use mindfulness exercises during and outside trading sessions to stay grounded and flexible.
- Trade only when in an optimal state of mind, respecting stops to alleviate the pain of poor trades.
Act Accordingly
This session offers valuable insights into traders’ mental barriers, particularly cognitive defusion and emotional bias. By practicing psychological flexibility and embracing moments of self-doubt with awareness, traders can make more informed, value-aligned decisions. Let this session remind you to cultivate resilience and use your emotions as signals for growth rather than hurdles to success.