The Secret to 'Picture'-Perfect Profits
Wednesday, May 6, 2009 | Teeka Tiwari
Yee-haw! Giddyap, cowboy -- we are runnin' and gunnin'!
The bulls are going wild -- it’s like 1999 all over again! "Mmmm, maybe I can buy that yacht after all" is what many are currently thinking.
The recent market action has been nothing short of amazing. What’s driving this action is the near-universal belief that the worst is behind us. The Street is pricing in an across-the-board, end-of-year recovery.
It doesn’t matter whether that recovery occurs or not. It’s the generally accepted perception that it will occur that is driving prices higher.
Is This a Valid Assumption?
Even if the assumption is not valid, could a faulty assumption actually bring about a recovery?
In the stock market, perception -- whether faulty or not -- is the only reality that matters. Sometimes those perceptions create tangible new economic realities. If we all believe that a recovery is in the offing, will we spend more, will we travel more and will we be willing to be more optimistic about our futures?
Optimistic people spend money; optimistic business owners don’t fire people. So, yes, it’s reasonable to assume that a persistently adhered-to, faulty optimistic perception can alter economic reality.
If we look at the actual economic news, we can see that the “real” reality is still very treacherous. ArcelorMittal (MT) and U.S. Steel (X) both recently reported numbers that were twice as bad as the Street was looking for. Global steel-mill utilization rates are at levels that haven’t been seen since the Great Depression. The banks are still broke and GDP is falling off a cliff.
The key here is to stay with the market perception until it changes. Too many traders have lost too much money trying to “tell” the market what to do. At some point, the perception will shift again, and so will the market. It’s moving with this perception shift that is one of the hallmarks of a great trader.
Trading the market in front of you vs. trading the market you think it should be is a great struggle for many investors. All too often, market participants get stuck in a perception trap and they steadfastly refuse to budge from it.
Mental flexibility is one of those things that’s easy to talk about but can be tricky to implement. The stock market is truly impersonal, but how many traders out there secretly believe that the market is “out to get them”?
The truth is, the only person out to get you is you. Our trading experiences are the sum result of what we give ourselves permission to experience.
The Acquisition of Wealth is a Mental Journey as Well as a Physical One
Being able to see yourself experiencing great trading success and manifesting great trading success go hand-in-hand. How can you aspire to greatness if you cannot first imagine yourself achieving greatness?
Your trading future is solely in your hands. The level of success that you experience is directly related to your own beliefs about how much success you can imagine for yourself. Creative visualization has its place in all great human endeavors. This topic is rarely covered because, among other things, it’s difficult to quantify. But I guarantee you that every great trader, and every self-made man and woman has seen their success in their mind first.
Having a clear vision of what you want, even if it seems ridiculous given your present circumstances, does work. When I was 16 years old, I earned $3.75 an hour working for a burger and chicken joint called Roy Rogers. The idea of working on Wall Street at a prestigious firm and making millions of dollars was preposterous.
But it didn’t stop me from visualizing what I wanted. I had a clear picture of what I wanted to do and how much money I wanted to make.
Two years later, I went from working on a loading dock in Brooklyn to working for Lehman Brothers. How does that happen? I believe that if we can get clear enough idea about what we want and believe that it is possible, we can manifest it.
This is the “secret” ingredient that most successful people will never share. No one wants to come off as some new-age kook, and unfortunately that’s the stigma attached to visualization.
But whether we are aware of it or not, we are constantly feeding our mind with visual images. Very few of us, however, make a conscious decision to channel those images into a coherent vision of our desired future.
It's Time to Aim High
I was not able to build my first million-dollar business until I could first “see” myself doing it. It was only after I had started really believing that it was possible that it actually happened. I have never been able to manifest an outcome that was beyond my current belief system.
My beliefs about what was possible for me had to change before I was able to change what I was manifesting. So, when you put on your trades, ask yourself what image you are holding of yourself and the trade.
Visual imagery won’t make a bad trade good, though, and you’ll still need to employ your stop-losses and other sound money-management practices. But what conscious visual imagery will do is act as an invisible hand that gently guides you in the right direction.
I know that might sound like hogwash, but I’ve experienced it and I am willing to bet many of you have too in various areas of your life. You must pay attention to what you focus on because what you focus on is invariably what you create.
Dream Bigger, Live Larger
How do you see yourself and your abilities as an investor? Are you envisioning yourself winning big, or simply hoping that you don’t lose?
Hoping to not lose is a form of focusing on losing. Always put your mind on what you want -- not what you don’t want.
Re-read that last sentence; it could change your life forever.
Investing can be the ultimate wealth-creation vehicle. In fact, I know of no other way to parlay a small amount of money as quickly or as dramatically as one can in financial markets.
If the financial markets are what you want to use to manifest great wealth in your life, then start seeing that for yourself. As you do so, you will automatically expand your wealth-creation efforts exponentially, and new mental faculties will be made available to you. You will automatically take your investment game to another level, and it will be effortless. The vision you hold of yourself will propel you to take different actions, and you will do so without conscious effort on your part.
You’ll experience that magical state called “flow.” Many athletes have experienced this state where they just “know” that they are going to make the shot, catch the ball, hit the ball, etc. All of us have experienced being "in the flow" at some point in our lives.
Visualizing the best outcome for yourself is a method of consciously entering this state of mind we call “being in the flow.” First, you have to let the prospect of prosperity into your mind. And, of course, you have to do the work (i.e., make the trades and manage them well). But once you learn to envision banking profit after profit, actual profits will follow with more frequency.
"Ask and ye shall receive" is a universal spiritual truth. We "ask” by only seeing and focusing on the outcomes that we desire. The more we do this, the more we put that “unseen hand” to work for us. In a market like this, we need all the help we can get, so start to picture yourself profiting today!
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Teeka Tiwari
Chief Investment Officer
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