Don't Think About Winning

Happy Tuesday! I hope you’re all having a great start to your week and the new year. It was a volatile day in the markets, and if you read my last newsletter, you should have a solid understanding of the reasons behind that volatility.

In today’s newsletter, I want to take a slightly different approach to the topic. I want to discuss why I believe it’s important to think about being a loser in the markets rather than focusing on thinking like a winner. Sounds strange, but let me explain.

A Winning Mindset

What is a winning mindset? In dictionary terms, it’s “a growth mindset that involves having the right attitude and beliefs about yourself and your abilities.” You might wonder, why wouldn’t I want a mindset that includes being positive and believing I can succeed in the markets? The truth is, you should—but there are additional factors to consider when you’re thinking like a winner. Let me explain.

A winner likes to look into the future to see what they will achieve. A winner is someone who visualizes the trophy, medal, good grade, dream job, dream car, or dream house right in front of them before it even happens. That’s just natural human behavior when it comes to desiring things in life. When we adopt a winning mindset, we naturally focus on the objects we are striving for.

Think about a time when you wanted something and aimed to have a winning mindset. Now, ask yourself—what motivated you? Your answer is most likely the thing you were chasing: the end goal.

A Winning Mindset, but in the Financial Markets

Now that I’ve covered the idea of having a winning mindset and the natural behavior of being motivated by the end goal, let’s relate this to trading. This is why I believe that having a winning mindset in the markets is not only dangerous but also one of the main reasons many traders fail.

A lot of newer traders—hell, even I—got into the markets thinking about money. Let’s be real, money is the root of survival nowadays. It used to be about actually securing resources yourself: food, water, shelter. But now that society produces all of these resources, what you need to survive now is green dollar bills.

No one—and I mean absolutely no one—gets into the markets if it isn’t about money. So, we can confidently say that the end goal, or at least the goal for most people whenever they make a trade, is 100% of the time about coming out of that trade with a profit (which means making money).

Now, think about a time when you had a winning mindset while trying to achieve a goal. It could even be a goal you have yet to achieve. I would argue that thinking too much about the end goal distracted you during the process, making you feel like you were getting closer to it, when in reality, you were not.

This same process of thinking about what we want almost makes us feel like we’re making progress. It’s somewhat like how we often watch sports or shows—it makes us feel like we are involved with the actual players or actors. But how does this relate to trading? It relates to how we often think about money in the markets. We all know there is money to be made. It’s currently 8:40 PM, and if I wanted to, I could open up my charts and my futures broker and enter a trade with the chance of making money.

So, the fact that there is always money to be made makes it easier to think we are so close to being profitable, so close to achieving the goal of financial freedom within the markets. But in reality, having that winning mindset not only makes you feel like you’re close to your goals without putting in much work, but it’s also affecting your actual execution in the markets.

The Effect on Your Trading

Now that we’ve covered the psychological concept behind what causes us to have a winning mindset and what keeps us motivated (the end goal), let’s quickly discuss how this winning mindset can actually hurt you more than help you within the markets.

1. Causes you to focus on factors you can’t control everyday in the markets (your potential reward), rather than focusing on what you can control everyday (pre-determined risk).

2. Causes you to form a connection between making money in the markets and success, which is far from true. This promotes the trader to believe that even if it’s an awful trade, if it made money, it’s fine. (It’s important to study not just your losses, but also your winners to ensure you aren’t developing bad habits within them.)

3. Encourages chasing trades for the sake of making money, rather than waiting for optimal setups. (Patience is crucial; jumping into every opportunity can lead to unnecessary risks.)

4. Leads to excessive risk-taking, as traders may ignore their risk management rules in the pursuit of higher profits. (Maintaining strict risk controls is essential to avoid large losses.)

5. Can make you feel attached to trades because you see them as personal attempts at making money, rather than objective assessments. (It’s important to detach from trades and focus on the process, not the individual outcome.)

Conclusion

Desire to make money is a natural motivator in the markets, but focusing too heavily on this outcome can cloud judgment and lead to poor decision-making, and trust me I know from first hand experience… A "winning mindset" rooted solely in profit gain can encourage emotional trading, risk-taking, and impulsive behavior, all of which undermine long term success. Instead, traders should focus on what they can control: their strategies, risk management, and discipline. By separating the desire for profit from the trading process, traders can cultivate a mindset that prioritizes consistent growth, learning, and improvement—key components of sustainable success in the markets.

I hope you find this write-up helpful, and I wish you an amazing trading week!

To my traders: trade safely, manage risk, and live to fight another day.

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