How to Overcome Fear and Anxiety with 1 Simple Mindset Shift // Ep. 56

In This Episode

• Why fear is often misunderstood as negative
• When it can become addictive
• How to turn a negative fear into a positive advantage

How to Shift Your Mindset to Overcome Trading Fear

Some traders become fearful when there is massive change in the world and when the future becomes uncertain. So in this time of great uncertainty, we talk about how overcome fear and actually turn it to your advantage.

When people become fearful, they often retreat into what they feel is safe. But we'll show you how uncertainty can become a good time to expand and even prosper.

Read the Transcript:

Hugh:    Hi, Walter. This is a big time of change obviously you know this last year and this coming year is going to be probably even more change. So what can people do to kind of weather the change and kind of roll with the punches and even benefit from the situation?

Walter:    I will tell you one thing I’ve learned. I think people sometimes confuse fear as you know they give it like a negative. For example, if I grow up in a country like Australia where predominantly, I notice this when I came to Australia that like all the people when you get off the plane, at the airport, everyone looks like they’re all from England.

They’re all these white faces and that was so different to me growing up in the United States. In particular, in California where you know, I have black friends, Mexican friends. I’ve had friends from Taiwan, he’s a good friend growing up. Lots of friends from Mexico of course. I had friends from Japan. I had friends you know from everywhere.

I have a really good friend from Guatemala in college. If I took someone out of Australia and dropped them off in the middle of Angola, where they are going to stick out, that can be scary but why? Why are you scared?

If I will just pluck someone out of Sydney Airport and I say, “Okay, we are going to Angola” and I’ll try to dump them in Angola. They would probably be fearful but why? They don’t probably know anything about Angola. Maybe they didn’t even know it was a country. They never heard the name but yet here they are, they look different and they are fearful.

I think that’s really what gives us the core of fear, the unknown. So we do not know about something and we have to confront it. What do we do? I think fear in a way is like a sign that you are in a spot, you are in a place where it is very exciting. It is exciting. Think about it, most of our life, what we do is so normalized.

You get on the bus at the same time or you get into your car at the same. You go to work at the same time. You go to the same cafe, you have lunch with the same people, do you know what I mean?

So much of it, I know it is not always the case for everyone like you might have a meeting over here or a meeting over there or you might have a business trip or whatever but the point is, most of what we do is just so normal. When you are fearful, to me, that is like a sign that you're alive and the unknown is there and that should be exciting. I think we misinterpret excitement over the unknown as fear.

Hugh:    Hey there! I hope you find this episode useful. I just want to let you know that Walter and I give away something valuable every month that helps traders improve their skills. You can enter to win by simply leaving an iTunes review and leaving a comment on our YouTube videos.

At the end of each month, we'll look at the comments and reviews from the month and we'll pick a winner at random. Each comment and each review counts for one entry during the month that it's pitted.

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Walter:    Because we do not know what is going to happen. We like it when we know it is going to happen, when we know what is likely to happen. I think this really applies to trading. In fact, one of the things FXStreet was asking me about a couple of years ago. I think it’s a new year’s resolution. They asked a bunch of people in there and I said, because I do webinars there. I just do it once a month now.

They said, “What are you working on for the New Year?” I said, “I really wanted to work on this idea of fear and embracing the unknown” because that is what we do as traders. You and I, we risk our money, we put it down and we say, “I do not know what is going to happen here but I believe enough in my data, in my testing. I have enough confidence behind it. I am going to risk my money because I think there is a good chance that X is going to happen and X is good for me.”

So I think fear, you can kind of twist it in your head and look at it. Flip it around and look at it as an excitement for what is to come. For the unknown that is to come and that can be another opportunity to learn something. That can be another opportunity to see something about yourself that you haven’t seen.

That is why I think we should sort of reorganize how we view fear as something exciting, not as something so problematic or dark or negative. Rather, interpret it as something, it is really kind of an excitement. It is an excitement that we are interpreting in a negative way. What are your thoughts on that?

Hugh:    I totally agree. I think that in reality there aren’t too many things that can really harm you. It is an opportunity to grow especially in this environment. There are a lot of opportunities to make money. Trading or whatever you are going to do and I think if you just come down and just objectively see the situation and say, “Okay, this is going to go away and maybe this is going to come up and that is an opportunity and this is the opportunity to do this” then I think it becomes much more interesting and a lot less scary.

Walter:    I think the downside is you can get addicted to that like base jumpers or NFL football players running into people. Do you know what I mean? Like big wave surfers, there are ways where I think you can kind of take it to the extreme. Gamblers also. So that is important for traders, is to recognize that a certain proportion of traders are actually gamblers.

I would say Jesse Livermore would fit into this category. You can look him up. We can put in the show notes. If you look up the Reminiscences of A Stock Operator which is a biography of Jesse Livermore.

It is tricky, you know there is that balance of embracing fear versus getting addicted to that feeling of overcoming the long odds of jumping off of the building. Do you know what I mean? That is a bit tricky, certainly.

Hugh:    You definitely got to know the odds or whatever in your own skill level.

Walter:    That is right. Exactly, that is where the simulator comes in for traders.

Hugh:    Totally, cool. Thanks, Walter.

Walter:    Thanks.

Hugh:    All the information in this podcast is for educational and informational purposes only and is not trading or investment advice.

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