Do You Have An Emotional Attachment To Your Trades | Podcast Episode #72

0:00
Hey, everybody. This is Ryan Mallory. Podcast number 72, I believe it is. I’m on my way to 100. It won’t happen this year, but sometime before the middle of next year, I should definitely be able to hit that, probably like springtime, hit my 100th podcast episode.

0:15
I do one a week. They’re on Wednesdays that I typically drop them. So always be on the lookout on those days for them. Usually they have something to do, they’re like intertwined with current market issues and strategies and also with some underlying education too of, so that if you’re listening to these podcasts and you’re listening to this particular podcast, and it’s, let’s say it’s 5 years down the road, it’s still relevant. It still makes sense because I take educational elements of trading and my knowledge and I intertwine it with market conditions that we’re seeing right now.

0:42
So, and a lot of market conditions actually repeat themselves over time. So today, I’m gonna talk about emotional attachment to your traits.

1:03
Emotional attachment to your traits, being too emotional about the stocks that you have in your portfolio. And the reason why I bring this up is because this past week. I had a lot of people take issue with a comment that I made on stock twits. And here’s the thing, like, most of the time I don’t get a lot of pushback from people, they don’t really get too upset because I don’t.

1:26
Really say things in an emotionally charged environment. Well, I did, I actually made the comment on Friday of last week, and right now it’s Wednesday because that’s when I do my podcasts. So Friday of last week, I made a comment, and I’ll read it to you here.

1:41
It says, The stock market needs a good 10 percent pullback just to provide traders with the opportunities again. Very little out there that won’t punish you on the risk side if you are wrong. Reward is very limited. Price action is getting frothy. Now that frothy word, that’s what people got a little bit freaked out about.

2:00
People will be pissed by me just saying as much, which I was right. Because they are super emotional about this market. Also true. But as a person who has been doing this for nearly 3 decades, and that is also true, you wouldn’t think that, I mean, I’m 39, but I actually been doing this since I was 11 years old, not like SharePlanner per se, but I have been in the stock market since I was 11 years old.

2:21
I’ve been doing it since then. I’ve been doing it. Continuously since then for the most part, I think there was a little bit of a break when I was in college. But to continue, I said, for a person who’s been doing this for nearly 3 decades, this probably isn’t the best time to be adding a lot of new positions to the portfolio. This is on Friday.

2:38
OK, so I said that after the market closed at 4 p.m., literally at 4 p.m. Market rallied on Monday. Finished lower on Tuesday. So far it’s trading lower today, not by much. We’re not talking about huge sell-off here. It’s still holding the breakout level. All right.

2:54
And here’s the thing, I can say that I want a 10 percent pullback. That doesn’t mean it’s gonna happen, and that’s not what I was even trying to say right there either. All I was trying to say was that the market needs a 10 percent pullback just to give us some better trading opportunities because there’s a lot of positions that have made some huge runs, and they just aren’t that good, uh, of opportunities right now to to be getting long on.

3:15
And the reason why is because let’s say you get an apple, OK, at 250. Way overextended. The reward to the upside is probably limited at this point. Maybe you get 260 out of it, OK? I don’t know, but maybe you get 265.

3:32
But the downside is, is that if you’re wrong on the trade, there could be as much as like 5 to 10 percent of downside just an apple. So the risk reward isn’t really there for getting into a long position at this point. But don’t say that on social media because everybody’s gonna be saying he’s calling for a market top.

3:50
He’s saying that the stocks are going down 10 percent in the next day or two. That’s not what I’m saying. I’m saying I would like for them to. I would like for them to sell off some. I’d love to see, let me be honest, if I, if I could have it my way, I would like to see a 20 or 30 percent pullback. I would love to see a, a legitimate bear market happen.

4:10
Just so that we can wash out all this euphoria and, and, and frothiness in the market to get a little bit more realistic prices for trading to the upside, to make it to where there’s bigger gains that can be made going forward. You take this huge sell-off back in quarter 4, which is almost like 20 percent or a little over 20 percent, and you had this big rally in the beginning of the year.

4:31
That was a great, that was phenomenal. But now we’re sitting at all-time highs. Yeah, we’re still pushing higher and everything. We keep buying the dip and all that, but there’s not a ton of upside at this point. We’re much better off if we sell off 1 or 2000, uh, or I’m sorry, not 1 or 2000 points on the, uh, actually 1000 points would be great on the S&P.

4:52
Um, 2000 is, you’re getting some dire places there, but, uh, like 4 or 500 points. Give me that, OK? I would even take 20 or 300 points. 300 points would be about a 10 percent correction, but it would alleviate a lot of the, the buying pressures in this market, provide you a better setups, give you a really good bounce place to take advantage of.

5:16
But see, when you make it, when I make a comment like that, they get very mean, right? They get personal. They even go back into like trying to find. Quotes or tweets or whatever that, that I had posted, and they went back to like October 30th about a intraday head and shoulders pattern that I was mentioning and AMD.

5:37
There was a head and shoulders pattern on the 30-minute chart. I wasn’t wrong about that. I just said, hey, 30 minute. Uh, chart on AMD has a head and shoulders pattern. More of a caution, not didn’t say sell it, get short, and I didn’t neither. And if you’re in the splash zone, you know that I didn’t do it.

5:54
I never posted a trade set up off of it, but everybody’s like, this guy’s a moron. He’s calling everybody to short AMD and it’s only gone up 7 percent since then. Yeah, it did go up 7 percent. But here’s the thing, I, I didn’t say short it. I’m just saying, hey, here’s a bear’s pattern.

6:09
You might just want to pay attention to see what it does. The next borrow went right back up. It nullified the pattern. Who cares? Boom, you’re, you’re done. You’re out of the trade. You don’t even have to worry about it at this point. But what it is is people are super leveraged to the long side. They’re wanting to make money. They have needs and those needs translate into emotion.

6:25
So when you tag something on Twitter or on stock twits and you say something about Spy or the Russ or any other individual stocks. You’re messing with their needs, their emotions are tied to their needs. And they also probably have too much, just like I said, they’re over leveraged, they have too big a positions, deep down inside, while they’ll go on social media it’s like, oh, to the moon, it’s ripping higher, it’s 2 points higher, and it’s ripping, it’s big, it’s huge.

6:52
While they’re saying that stuff deep down, they’re frightful that they’re gonna lose this money that they have in their. Their portfolio, they’re incredibly, they’re incredibly fearful of somebody like me, and here’s the other reason why. I have 75,000 followers on Stockwitz. There’s another uh 11,000 on Twitter.

7:11
So they see my comments and they think, OK, he’s, he’s affecting a, a, a wide audience with his words. There’s a lot of people that follow him. So what do they do? They want to tear you down. You see that in politics too. And, um, you know, in the stock market because their monies are tied to their positions, they get emotional. But the thing is, is in trade, you cannot be emotional about your trades.

7:30
In the end, who cares what somebody else thinks? I’m not Warren Buffett, never claimed to be. I don’t have not a fraction of the kind of money that he has. So my, my words aren’t necessarily gonna move the market. Definitely not gonna move the spy.

7:46
The Spy does not care what I think. OK, I’m just gonna tell you what I think. Doesn’t necessarily mean that’s how I’m gonna trade or how you should trade. I’m just telling you what I’m seeing, what I’m thinking. The market doesn’t care what I think. It doesn’t care what I see, it doesn’t care what I want. It only does what it wants to do.

8:02
So if I call for, um, and I hate using the word call because that’s not what it’s doing. If I say, hey, I, I think this market would really benefit from a 10 percent sell off, that doesn’t mean it’s going to sell off 10 percent. Not a chance does the market care about what I say.

8:19
It doesn’t care about what you say either. Not one lick So in the end, who, who cares? If you’re long on AMD, somebody says, uh, there’s a bear pattern on AMD. Consider it. Say, OK, let’s see if there’s any merit to it. If not, OK, dismiss it.

8:35
Maybe it doesn’t fit in your time frame for how long you’re holding AMD. All right, cool. But don’t get all emotional about it. I mean, people really got to check their emotions at the door when they’re trading stocks, and when you’re coming after somebody, when you’re going after them personally, when uh people are ganging up on the person, that just shows how immature you are in the stock market.

8:56
Or or that they are, not you, because you listening, I don’t think. You’re, you’re, uh, really, if you’re this far in the podcast, I don’t think you really hate me as a person like some of these other people do, but These people, they really get upset about what you think because somehow or another, it’s invalidating their opinion or their belief about what the stock market should do for them.

9:18
Guys, here’s the thing. If you’re in the splash zone, you know I’m wrong. I’m wrong wrong all the time and I’m gonna be wrong in the future. I got Positions open right now. 3 of my. Three of my positions are trading higher, 1 of them are trading lower. The one I, that’s trading lower, I just got into it today.

9:35
It’s a short position and it’s been rallying ever since I got in. That’s gonna happen in the stock market. The other 23 positions, they’re going up today. That’s great. 2 of the 3 that I came into the day with, I was profitable on, but there’s that one that I was down on. That’s gonna happen in trading people.

9:50
You’re going to be wrong. And when you think that you have to be right, when you have to be right on social media, when you have to be right with your friends, when you have to be right with what everybody thinks of you pertaining to your stocks, your picks, your investments, your trades, that’s when your portfolio is gonna suffer the most because you’re going to be trading with an emotional attachment to your trades.

10:10
If the trade doesn’t work, you move on, you cut losses, you move on. That’s what a stop loss is for to keep you from being emotional. And then at the end too, you got these, these people that they don’t have as big of a following. They see me, I have a big following, not like, like, not like a Kardashian or a Trump or or somebody like that.

10:27
No, it’s just big for for stock with. It’s 75,000. It’s probably like the 0.1 percent of people on there. So yeah, it’s got a big following and so these people, they They also want to bring attention to themselves, and they wanna say, hey, this guy’s a moron, this guy’s an idiot. He doesn’t know what he’s doing because he’s hoping that I’ll engage and, and yeah, I, I, I kind of did engage with him a little bit, but then I got kind of smart.

10:46
I said, you know what, I don’t know these people explanations. They’re just out here to attack me. I blocked them all. I’ve never even used the block feature except for maybe once before when a person was, uh. Insulting family and just saying some really crude remarks. Since then I haven’t even used it. This time I did use it.

11:01
I, I just, I probably have blocked like 1520 people. I don’t care if they they don’t have access to what I have to say. They don’t care anyways. They’re, they’re already obsessed with what they think. They’re just looking for groupthink mentality of people who will agree with what they’re saying. So if I come along and I say, hey, I don’t necessarily agree with that, here’s why they all flip out.

11:23
So, and you know. Those people, they’ll, they’ll blow up their portfolios and they’ll, they’ll move on and everything. I’ve been doing this for, I’ve been doing the splash zone since 2007. I’m still here. I haven’t gone anywhere, and I think in the, in the history of the internet, that’s kind of like That’s kind of like archaic, right?

11:44
SharePlanner’s archaic. It’s been around forever. So if it’s been around since 2007, it’s doing something right. And I take pride in what I do. I mean, yeah, I am probably a lot more conservative on a risk basis. There’s times when I take profits too early. I took profits too early in in Nvidia.

12:02
Not yesterday, but I think it was the day before, maybe it was yesterday, might have been yesterday. No, it was the day before. It was uh it was Monday. I took profits and Nvidia far too quickly. And as a result, I missed out on like an extra 2 percent in the trades.

12:18
That’s just because I’m trying to manage the risk. I’m gonna be right at times. I’m gonna be wrong at times. I was right about getting out of McDonald’s for a 1.5 percent profit because that sucker dropped big time the next day and then I was able to get back in today and I’m actually up on the trade. So, uh, 22 trades in a row on McDonald’s so far so good.

12:35
But you just can’t let the emotions of trading get to you. You really can’t, so. That’s gonna be That’s gonna be it for today, um. Hope you enjoyed the podcast. If you have any questions, always feel free to reach out to me, ryan@shareplanner.com. Thank you and God bless.