Case Study:How to Improve Trading Behavior

By | April 17, 2019

We are going to Discuss a Case Study of one of My Student How we were able to help him to get rid of a bad Trading habit as part of Psychological and Performance Coaching, Many of readers would also be facing the same trading problems can learn from the below case study and apply in there own trading.

Brijesh had been trading Nifty futures based on Gann Strategy for the past 5 years. He neither got very excited at large wins, nor very upset at drawdowns. He
was profitable, but often found himself increasing his position size right
after a losing trade. He told he wanted to recover his losses ASAP so easiest way was to increase the position Size.

So I asked Him Why he wasnts to Recover the Loss ASAP.Below are his answers.

  • I don’t like booking a loss.
  • It Hurts my “EGO” To Book a Loss
  • I feel like a failure after having a loss.

We did a Through Study of His Trades to recognize his trading behavior and what all needs to be changed to get rid of his Trading Problem and Proposed the Below Solution. Part of your plan for change is to know what will pose the greatest difficulty for you in carrying out your plan. We made him to think and Write his short and long term Goals and made a Framework which can be used to track his progress. We specifically told him it will be a long road ahead as When you confront your own challenging trading situations, be aware that this will be hard work. It is unlikely to come easy. This is to be expected because making changes from emotion‐driven trading actions to values‐driven trading actions is difficult. It took lot of session to keep him motivated and continue on the journey of correcting his behavior.

Brijesh challenging situation: Increasing position size after a loss
Short Term Goals: To notice when I am vulnerable to over sizing my position and to reduce this behavior by 50 percent over the next two weeks of trading based on Mindful  Exercise
Longer‐term goal: Eliminate placing out sized positions completely within 90 days

Plan to Achieve Short Term Goal

  • Immediately after a losing trade leave my trading Terminal and
    engage in a 10‐minute Mindful Exercise .
  • Affirm my commitment to being a steady trader and state to myself that increasing position size runs against how I want to trade.
  • Before taking the next trade, reconfirm my commitment to be a steady
    trader and trade with appropriate size.

Roadblock which will Happen:
The tension and agitation I feel for having a loss along with the
thoughts and emotions that I failed.

How I will Remove the Road Block:
Rather than try and fight them, I will notice the tension in my body
and also acknowledge the thoughts of failure and the emotional
unease that these bring. I will apply mindfulness Excecise No 2 and recognize that these are only thoughts and feelings that will soon leave me.

Point to Note is Framework we designed  is very specific and highlights the high‐value actions—both mental actions and trading actions—that support initial goal.

This plan with Proper Short and Long Term Goal helped him to improve his trading behavior  and led him towards more consistent and Profitable trading.

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