Throughout our lives, we are told that the key to success is to compete with others, and beat them. We compare ourselves to others, inspire ourselves to do better, and try to outperform our peers. As children playing sports, we were advised to hone our skills and become a star player.
In school, we were often told that higher grades were the key to long-term success, and that we better get them, or else we would fail. And when we enter the working world, we learn that survival depends on beating out our competition. But when it comes to trading, you aren’t actually competing with anyone but yourself. When it comes to trading, an obsession with winning can actually do more harm than good.
Comparing our performance with others does seem to have some advantages. Knowing that a goal is attainable is often a powerful motivator, for example. Several scientific discoveries were slow to materialize because they were thought impossible at first. But once the goals were deemed feasible through comparisons to others in the scientific community, progress was accelerated. But comparisons can also have adverse influences. Ironically, people who achieve great things usually work independently. They follow their own timeline, follow their own passion, and look inward for where to go next.
Trading is a similar creative process. You are the only one who needs to hone your trading skills. You are the only one who must find a method that matches your aptitudes and personality. Comparisons to other traders can often prove problematic. How you perform has nothing to do with how others perform. And comparisons are likely to cause upsetting emotions, such as jealously or envy. Upon seeing that you are doing relatively poorly compared to a fellow trader, you are likely to think distracting thoughts such as, “Why can’t I do as well?” or “I must not be as good of a trader as I had thought,” Such thinking does nothing to keep you focused on honing your trading skills.
Don’t look at anyone else’s record but your own. You’ll often be tempted to compare your current performance to that of others. That’s how it’s been throughout your life, and it’s not easy to change a lifelong pattern overnight. But with trading, you must restrain this urge. Everyone has a different learning curve. To keep your spirits up, you’ll do best as a trader to focus on improving your past performance record in your own time and in your own way, rather than trying to match other traders.
You don’t know what factors created their performance records, so comparisons can only mislead and hinder you. Other people’s records do not have a direct bearing on your own record. Who cares if you make 50% less than other traders? Your energy should be focused on making yourself a master trader as defined on your own terms, not on beating others. Such comparisons will only disappoint and distract you. Focus on you, the markets, and nothing else. You will trade more calmly, creatively and profitably.