Why We Are Afraid to Lose & How to Transform This Fear

Have you ever failed to the pull the trigger, even though your ideal setup was right in front of you? What about feeling paralyzed to hit the buy/sell button after a big loss? Have you noticed how your mind tends to race right before you fire off a trade as you think about your last loss?

All of these debilitating experiences tend to follow our fears, particularly being afraid to lose. Ironically, our ‘being afraid to lose’ often times goes beyond the potential loss of money. In most cases it has to do with something beyond the pure dollars at risk. In many cases, it becomes one of the primary hurdles a trader faces and never overcomes.

fear of trading and transforming fear 2ndskiesforex

This article will first go into the underlying reasons why we are afraid to lose. Then I will share a method how to transform this fear to enhance your trading performance.

Behind The Curtain
In reality, there are several ‘reasons’ why we experience being afraid to lose when we are trading. A few examples are;

a) Perhaps we have an unconscious fear of making a mistake and what that might bring (i.e. a parental punishment)
b) We fear the potential loss in money and our ability to make it back
c) Making another mistake will only confirm our suspicion that we cannot trade

I could probably spend an entire day listing dozens of reasons why we experience this fear. But behind the curtain of it all I find are two variables which remain constant;

1) The anticipation of what has yet to come
&
2) An unconscious or limiting belief that perceives the potential outcome as a threat, dangerous or painful

The first one is something the Buddha once said, that ‘Fear is the anticipation of what has yet to come‘. Imagine if we approached our next trade and had no anticipation of what was to come next. We just trusted our system and pulled the trigger, then let the system play itself out.

More than likely you’d experience a lot less emotions and the debilitating physical responses that tend to affect our thinking. Although many people get this idea ‘intellectually’, it is easier said than done. Often it takes years of practice, training and experience to have happen moreso than not.

fears are the stories we tell ourselves 2ndskiesforex

As to the second one regarding ‘unconscious or limiting beliefs’, most of the time, we are not just trading the price action setups in front of us – we are also trading our thoughts and beliefs about money, our ability to make money, what our perception is of our P&L, our current trading skill, and more. In most trading situations, we are not just trading setups at key levels – we are trading our unconscious limiting beliefs + our motivations for why we are trading.

How To Transform These Fears
There are three things you can do help reduce and transform these fears. They are;

1) Expand Self-Awareness

2) Awareness Practices In The Moment

3) ERT to Remove Unconscious or Limiting Beliefs

Expanding Self-Awareness
The first step to expanding your self-awareness is to recognize how our thinking, emotions and perceptions in the moment affect our interpretations of things, particularly related to trading. When you do this, you begin to realize how these ‘perceptions’ of your trading will color your experiences and memories around trading. This can have an empowering or debilitating effect on your trading performance.

A trading journal also helps us to see how our trading behaviors often repeat, and thus help us to become aware of the mistakes we make frequently. This is to help keep us honest and in check about how we are really doing from day to day.

Awareness Practices in the Moment
One awareness practice that helps us in the moment is a silent meditation practice. I am not talking about a guided visualization, but a mindfulness practice designed to help us become aware of our mind, thoughts and mental activity in the moment. By sitting every day before you start trading, you can calm your mind and see how the traffic of thoughts can affect your trading.

If you think your mind is busy while you are just sitting trying to focus on your breath while little to nothing is going on – imagine what its like during trading?

Meditation and mindfulness practices shed a light on how our mind works and is working in the moment. By having a contextual experience of calm, clarity and focus, you can recognize when you are not calm, clear and focused.

meditation mindfulness practice and awareness in trading 2ndskiesforex

Also, meditation and mindfulness practices help tremendously in expanding your self-awareness, so taking out two stones with one.

ERT to Remove Unconscious / Limiting Beliefs
Sometimes we have unconscious or limiting beliefs which interfere tremendously with our trading. If you find yourself repeating the same mistake without knowing why, in 99% of the cases, it has to do with an unconscious or limiting belief.

Our mind stores memories like a bunch of pictures stuffed in a shoebox, so your memories around money when you were a kid could be right next to your memories around trading. Activating memories of one can excite the other, and thus affect your trading performance in real time.

These often take the longest to uncover, transform and remove, and could take years of both meditation and awareness practices. One short cut to this process is ERT Training which helps you to discover and transform them quickly. We actually have an ERT Training program specifically built for trading. Many traders have already gone through the program and noticed tremendous changes in their trading.

fearless of risk jumping into ocean 2ndskiesforex

One final note about doing the three above is they inevitably lead to greater market awareness and more profitable trading. This comes from seeing more of what’s going on in the markets finding clues others would not since you are less inhibited by your fears. Intuition, confidence and your learning curve all tend to increase heavily when you build self-awareness, expand your awareness in the moment and remove your limiting beliefs.

Buddhist, Trader and Philanthropist

I'm Chris Capre, Founder of 2ndSkiesForex. I help traders of all levels change the way they think, trade and perform. As a professional trader, I specialize in trading price action. As a teacher, my passion lies in showing you how to re-wire your brain for successful trading. Want to improve your edge right now? Visit my Price Action Course page.

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  • FX Fishing

    Awesome article Chris!
    As a big proponent of meditation i can state to its general effectiveness. A very valued avenue of trading to tackle! đŸ˜€

    • Hello FX Fishing,

      Yes, its probably the most under-rated thing for development as a trader, yet totally free!

      Kind Regards,
      Chris Capre

  • Sanjeev

    Hi Chris

    Can you tell me more about the ERT training program?

    • Hello Sanjeev,

      Sure thing. Email me via the Contact Page and I’ll give you more details.

      Kind Regards,
      Chris Capre

  • Csaba

    Hi Chris,

    Great atricle as usual :-)
    One question though: what does ERT stand for, and what about ERT training.

    Thanks
    Csaba

    • Hello Csaba,

      ERT stands for Emotional Repolarization Technique which we’ve tailored specifically for trading.

      Kind Regards,
      Chris Capre

  • Santosh Kanekar

    Chris: I have been following your writing and miss your Fxstreet webinars. Your articles always come when I am facing an issue and you managed to just illuminate the path to me. I would love your comment on a dilemma I faced recently: I had this “jinx” that Fridays always are losing days for me (this is based on data). Today, I had a profitable trade and then, another setup lit up which was quite good. I backed off from the trade since I wanted to keep my Friday profitable. I was aware that this backing off is a result of “anticipated loss” and hence, I was trading my feeling and not the market. But, by keeping Friday profitable, I wanted to build the confidence for future Fridays. I dont know whether I did the right thing. I would really love your advice.