Why Your Personality May Keep You From Success In The Stock Market | Podcast Episode #38

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Learn to trade stocks successfully. Learn to profit consistently. I’m Ryan Mallory, and on my weekly podcast, I’m going to teach you the ins and outs of a complex, ever-changing stock market. You will learn to trade better, trade smarter, and profit bigger.

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Now, let’s go trade. Hey, everybody, this is Ryan Mallory with shareplanner.com, doing another podcast with you here today, and I’m gonna be discussing about your personality and how it may be keeping you from trading success in the stock market.

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So what do I mean by that? Well, There’s a lot of traits that we have as individuals that works really well in real life. And when I say real life, I mean like day to day work, client relationships, how you interact with your boss, how you interact with your family, your kids, people around you.

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And then just how you take on the daily tasks of life. But sometimes those same personality traits, they don’t translate well to the stock market. So, that creates a little bit of a problem and that’s probably why The majority of your traders that try to give it a go in the stock market don’t succeed because they’re trying to use the things that made them successful.

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In life, and they’re trying to apply those same tactics and that same personality that they have and their same approach to life to the stock market, and it just simply doesn’t work. So, for example, if you’re a person who is a really go-getter and has a lot of energy and, and Just keeps making things happen, that can work against you in the stock market because a lot of times you have to just be patient and wait for things to present themselves.

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You have to just be willing to wait and wait. And at times, it’ll feel like you’re wasting your life or your or your time during the day, but that patience is what really pays off in the end. Another one is his conviction. Conviction does not pay in the stock market.

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Now, some people will disagree with me on that, and I think they’re wrong, but you have to be willing to recognize when you’re wrong, and even when you think that you should have been right and move on to the next trade. Now, if you have this conviction, this diehard loyalty to something in real life and you see it through, that can really pay huge dividends for you, you know, having that belief in yourself and that belief in what you’re doing is going to work out in the end, that can pay huge dividends for you.

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In real life, but in the stock market, it doesn’t. In the stock market, having an undying loyalty to a stock can be you’re undoing it. It can result in you blowing up your portfolio, especially if you’re shorting a stock. And I’ve seen people like that. They will say, this company is going out of business.

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There’s no way they can keep making money. There’s no way they can stay in business, so they take a short position and the stock just keeps going up and up and up and up until they get a margin call and they’re forced out of the position and they’re taking on huge losses. So that conviction in the stock market is not a good thing.

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You can have a conviction in your strategy and your approach. Like there’s things that I have a conviction about. I have a conviction about risk management. That is the one thing that over the years has made me a great trader. It’s the one thing that’s kept me in the game and from making stupid, stupid mistakes, because I’ve been in trades that have gone way down, but guess what?

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I didn’t have to experience that huge sell-off because I got out with a very tight stop loss. I saw it all throughout October, November, and December when the stock market wanted to do nothing but go down. And had I had this conviction, this desire to see myself be proven right.

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I would have taken on huge losses, more than I could have handled, so. Conviction in the stock market is not a good thing. Let others have that conviction, OK? But you follow the trend, you, you go where the market wants you to go. And so, yeah, that’s the other thing too that a lot of people don’t like is that they, they look at the stock market and they, they want to exert their will on it.

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They want to be proactive and say, it should go up, it should go down, and then they make their trades based off of it rather than saying to themselves, what is the market telling me it wants to do? What is the market saying this is what it will do. Because when we have our belief about what the stock market is supposed to do or what we think it’s going to do, and then what the market actually does, that creates this huge conflict that’s going to always find you on the losing side of it because the market always wins.

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You don’t beat the market, OK, in that regard. You can’t thrust your will on the market and tell it what it’s going to do because it’s always going to do what it wants. It doesn’t care if you’re, you know, black, white, Hispanic, anything, OK? It doesn’t care if you’re male, you’re female, it’s going to do what it wants.

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And so you have to keep that in mind that the traits that you have that have made you successful in the real world will not make you necessarily successful in the stock market. And a lot of times it’s gonna work against you. You take doctors, engineers, and lawyers, these are some of the smartest people in society, yet they make some of the worst traders in general because they see themselves and they know, they know they’re smart, they know they’re very smart people, but it’s that, that intellect that gets in the way of them.

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Ever finding success in the stock market as a trader because They think they’re smart enough to beat the market. They come up with an idea of what the market should do, and they trade accordingly, and it doesn’t do it because the market doesn’t care if you’re a doctor, a lawyer, engineer, it’s going to do what it wants.

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So, that’s another thing. Sometimes your intellect can actually get in the way of, of trading success. Now I say all that, not because I have all the perfect personality traits of a traitor. No, I, I have, you know, a strong, um, sense of feelings and when I did the Myers-Briggs test, I’m an INFP.

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And with an emphasis on the F for feelings and so. I, I do have a, a huge sense of feelings in my own day to day actions, and I have to be cognizant of that. I can’t let fear or greed get to me when, when the market isn’t necessarily going my way, or to be too greedy when the market is going my way.

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And so I have to be. Aware of that and a lot of traders will not recognize the impact of their own personality on the stock market, how their feelings can affect their trading. They only look at it from a, am I in a winning stock? Well, winning stock trading has nothing to do as much with stock picks as it does with you.

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It’s you that matters. It’s you that has to manage the risk. It’s you that has to know when to get out of the trade and to move on to the next trade. If you’re not able to do that, it doesn’t matter what stock that you’re trading, you’re going to lose ultimately. And so, yeah, I have, I have traits that I have to be aware of.

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I have a pretty laid back personality, which is good, that I think that’s always a really good thing in the stock market because I don’t necessarily have to be entertained by the stock market 24/7. I’m willing to, uh, take what it gives me, but I, for one, am probably more of a perma bear by nature than I am necessarily a person who is constantly on the long side of the trade.

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I enjoy a good bear market to short and to make profits off of, but over the last 10 years you haven’t had that. So have I shorted the market much? No, I haven’t. So I’ve had to not allow my personality to get in the way of what the market’s doing here. I’ve had to be long for the large majority of the.

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The last 10 years now, October, November, December, that was pretty fun. I’ve made some profits there each month and, and uh beat the market each of those months and so that, that was an exciting time, but overall, my personality has had to take a step to the side and recognize what the market’s trying to do, not necessarily what I want it to do or what I hope for it to do.

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And so, wrapping this up, and this is gonna be a pretty short podcast, but I want you to remember about 90 percent of trading. It is about you. It’s the 10 percent of it comes from the actual trades, the technical analysis and all that, and that’s important.

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Don’t get me wrong, Finding good trading setups and everything goes a long ways to success. But the huge Large majority of it all comes from you, the, your brain, what’s between your ears? Are you going to be able to control your emotions? Are you going to manage risk?

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And let me tell you, managing risk is so, so important. If you don’t do it, you’re going to lose in the stock market. So do it. Always do it. And And in doing so, you’re going to give yourself the best chance at consistent and profitable success in the stock market.

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If you have any questions, feel free to email me, ryan@shareplanner.com. Thank you and God bless. Thanks for listening to this week’s podcast of Swing trading with Ryan Mallory. I’d like to encourage you to join me in the SharePlanner Trading Block where I navigate the financial markets every day with traders from around the world.

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And follow me at SharePlanner on Twitter and on SharePlanner’s Facebook page where I provide unique market and trading ideas every day. If you have any questions, please feel free to email me, ryan@shareplanner.com.

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All the best to you and God bless.