DESTRUCTIVE EMOTIONS & THE MARKETS

“Money alone sets all the world in motion.”
Pubilius Syrus Maxims, 1st century BC
Most people dream of being totally independent and self-sufficient financially. These people
spend millions of pounds on lottery tickets, hoping to be the lucky one to scoop the jackpot.
There is another way to make a million, the highly leveraged futures markets. Everyone has
heard stories of investors turning small stakes into vast fortunes, and it is this chance that
attracts traders to open futures accounts and dream, just like the lottery ticket buyers, of
receiving the big payout. The reality of futures trading is different; the profits always seem to
be elusive so each time the trader trades he suffers consistent losses rather than consistent
profits.
Trading looks deceptively simple, yet few succeed. If you read interviews with the great
traders, you will perhaps be quite surprised to learn that very few are intellectuals, many have
never been to college, and a considerable number even dropped out of school. Additionally,
most will claim they have simple trading systems that almost anyone can understand.
So what separates winners from losers? The answer is not just knowledge of the trading
environment, but also an understanding of our personality make-up and how it needs to
interact with the market in order for the trader to emerge with consistent profits. In the
following pages you will learn why an understanding of our own personality is the key to
successful trading, and how the emotions of greed, fear, pride and hope are fatal to trading
success.
“A cloud does not know why it moves in such a direction at such speed, it just feels a
compulsion that this is the place to go now. By the sky knows the reasons and patterns
behind the movements, and you’ll know too if you lift yourself high enough to see beyond the
horizon.”
Richard Bach - Illusions
Take any price of any commodity and you will notice trends over a sustained period of time,
where the price moves in a specific direction for a sustained period of time. Many analysts
believe that prices are random and that trying to predict future price movement is futile and
doomed to failure. However, behind the seemingly chaotic price movements there is order.
In the following pages I will give you an insight into how and why price movements occur
and how, over a period of time, you can capitalise on these moves and how you can trade
with the odds of success being firmly in your favour.