Words are powerful. Words are magical.
But the map is not the territory and the menu is not the meal.
Count Alfred Korzybski found the science of semantics back in the 1920’s. Wikipedia says, “Semantics is primarily the linguistic, and also philosophical, study of meaning.”
We use words in our mind when we think of something. We have the word “dog” in our mind when we think of a dog. It is well known that people who speak several languages will dream in one of those languages.
Our concepts of things are affected by the words we use. For example, the fight about abortions are led by people who are Pro-choice and Pro-life. Both sound great! Who is against choice? Who is against life?
So it is important that we use words that are truthful and reflect reality. We, as traders, must be reality based. Deviations from reality can get costly quick!
The more realistic we are the more profit we are likely to make. So the words we use can be of high value in our trading. Let’s take a look.
For example, we might say, after losing some money on a trade, that we got killed. Of course we didn’t get killed. This language makes us dramatize the effect of the loss. We have elevated it to the highest level possible.
What is the effect of that? You become more emotional about losses. They become much more anxious about losses. You flinch when you have them. Actually, you flinch before you put the trade on. None of this helps you make money and, in fact, it is definitely going to hurt your trading.
So what should you say? How about the exact truth with no value judgement? I lost $1000 in this trade. Very neutral words. A strict recitation of the facts.
By doing this, you will be much calmer about trading and more reality based.
This is one of the key techniques I learned to conquer myself to become a better trader.
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