“It doesn’t matter how many times you fail. You only have to be right once and then everyone can tell you that you are an overnight success.” – Mark Cuban
How do you feel when you lose a forex trade? Probably not great. But hopefully, losses and failures are something you can weather well.
Unfortunately, a lot of us grew up with pretty unhealthy attitudes about failure as well as unrealistic beliefs about how success comes about.
We may have been taught by our parents and teachers that failure was unacceptable and that our mistakes pointed toward weaknesses of character or proved we were incapable.
It also does not help that the media presents us with a lot of images of what looks like an overnight success.
As a result, if we fail, we often take that as evidence that we are on the wrong path. But as Mark Cuban’s quote points out, most people who look like overnight successes really are not. And in reality, failure is usually a necessary and unavoidable ingredient in the recipe for success. Nowhere is that more true than with forex trading.
Reasons a Healthy Attitude Toward Failure is Critical for a Forex Trader
You will fail over and over again.
The first reason it pays to have a healthy attitude toward failure as a forex trader is that you are going to be doing a lot of it.
Everyone loses trades. Everyone. That includes veteran full-time traders who do it for a living.
Moreover, everyone has losing streaks now and again, or times when their systems underperform.
And actually, most traders fail permanently, sad to say. You probably already know this.
That means that those who do make it do not thrive right away. They have to fight their way to success.
If you have a hard time processing failure, you are going to struggle psychologically with trading.
In fact, some people become so desperate to avoid the mental discomfort they feel when they fail that they give up completely.
Indeed, this is probably ultimately what washes out most beginning traders. It is not that they lack the abilities they need to build the skills they require to eventually succeed—it is that they get so down on themselves each time they fail to achieve the goals that they throw in the towel just to make it stop.
There is no overnight success in forex, no matter how badly you want it. You may set off dreaming of making a million dollars your first year, but that is incredibly unlikely.
If you are trading profitably at all in your first year, that is actually really great progress.
On that note, it may be helpful for you to redefine success.
Some traders are really hard on themselves and believe they are failing when they are actually doing quite well.
Make sure your expectations are realistic going in, and you will be able to better accept your failures and acknowledge and celebrate your successes.
Failure is how you learn and grow.
Do you feel you are getting further away from your goals with every trade you lose?
Actually, you might be getting closer to your goals with each lost trade—at least if you approach the situation in a healthy way.
Every trade you lose has a lesson for you. If you are able to put aside your frustration and self-blame, you can analyze what cost you the trade and learn a way to avoid a repeat.
Those who progress the fastest in forex (and in life) do not see disaster in every mistake.
They recognize that every realistic learning process involves mistakes and that making them does not reflect negatively on them or their abilities.
Making mistakes just means you are actually doing something (see below). There is no shame in traveling a path of learning, ever, no matter how challenging, and no matter how many times you stumble before you are able to walk, run, or fly.
So, be proud of yourself for being willing to make mistakes. You can grow from them into a better trader and a better person.
If you are too scared to fail, you are too scared to try.
People who are unwilling to make mistakes and suffer failures do not just give up quickly on new things—often, they never start them in the first place.
All of us know an eternal “expert-novice”—that person who has been studying forex for years, but who never quite seems to make it to going live.
Mind you, there may be situations where that trader truly is dedicated to their work and making progress.
But some traders never go live because they are simply paralyzed by the possibility of failure.
So, they come up with endless excuses—they cannot go live until they tweak this or that with their system, until the stars align until everything is perfect.
But perfection is impossible in trading and in life. The non-starter may never fail, but they will also never succeed.
How Can You Improve Your Attitude Toward Failure?
Now you know why a healthy attitude toward failure is so important for forex traders. But if you have a hard time dealing with failure, what can you do about it?
- Realign your expectations. A great starting point is what we touched on earlier. Make your expectations more realistic. If you are holding yourself to unreachable standards, of course, failure is all you will ever experience. Stop driving yourself crazy and start setting more realistic and achievable goals. When you experience a mix of failures and successes, you will start feeling better.
- Probe into where you learned your unhealthy attitudes toward failure. If you can find the roots, you can cut them off. For example, it might be a message you received from a parent. Once you know where it came from, you can see that it does not have to be a part of you. You can release it.
- Stop shaming yourself. Shame is something a lot of us feel when we fail. It is not like guilt, which focuses on feeling bad about what we did wrong. With shame, we feel we are wrong as people. Shame keeps us stuck. It makes it hard for us to look at our errors and learn from them. Thankfully, shame is not something we need to thrive. You can safely give yourself permission not to engage in it.
- Prove you can survive and learn from small failures. If we have internalized a belief that failure is always negative and catastrophic, it can help to prove to ourselves that is not true. One way to do that is simply to engage in situations where we have the opportunity to fail without disaster. If you manage your money well and set stops, trading is actually an ideal way to do just that.
- Don’t invite catastrophe. As an extension of the advice above, setting appropriate trade sizes and stop losses will also keep you from regular margin calls. Do not give catastrophe any unnecessary windows through which to strike.
That wraps it up. Failure may not be anyone’s favorite experience while trading, but it is one you cannot run away from if you want to ultimately succeed as a forex trader. Over time, you will grow a thicker skin, and you will discover the value in your failures. Someday, if you do become a trading pro, you will look back and smile at the many lessons you learned—even those you had to learn the hard way.
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