Guilt and Trading

Discussion in 'Psychology' started by Joe Ross, Nov 30, 2006.

  1. This question was sent to me from one of our students: “Hey Joe! I sometimes feel guilty about my trading. Is trading a sin?”

    No, trading is not a sin, but trading without knowing what you are doing can lead to a lot of problems. Trading in and of itself is not considered as gambling. The futures markets exist as a venue in which hedgers are able to “purchase” price insurance. The ability to hedge is the economic and social justification for the futures markets. However, gambling is considered to be foolish. Trading without adequate knowledge of the markets and self is foolish because by doing so you are gambling.

    There is a certain amount of self-knowledge needed to choose the proper trading method. It has even been suggested that many small traders in the futures market, without knowing it, secretly want to lose. They jump in with high hopes - but feeling vaguely guilty. Guilty over 'gambling' with the family's money, guilty over trying to get 'something for nothing,' or guilty over plunging in without really having done much research or analysis. Then they punish themselves, for these or other sins, by selling out, demoralized, at a loss.
  2. Very true that there are traders that subconsciously want to lose money. I used to be that way I think. I believe that my problem was I didn't do much research or preparation. So essentially deep down I didn't feel I deserved the money.
  3. Traders provide 2 primary services to the financial world. One is providity liquidity in stocks, bonds, and derivatives. The other is correcting disparities in pricing when engaging in pairs and mergers. For this valiant effort, good traders are rewarded by making money. Nothing to feel guilty about...donate cash to charity if it makes on feel better.


  4. Sorry, but that sounds like psycho-babble to me. I don't buy that people want to lose money. Beyond that, anyone that feels guilty about making money has never had to really work for it. Now if you're talking about some punk ass trust fund baby trading with mommys money, maybe. But someone that has had to work for it to begin with......not a chance.
  5. Guilty about making money trading? Yea right.
  6. This topic has been discussed many times over. I think the real question is which job does not have its own element of lack ofintegrity: sucking up to your boss, lying to customers, selling products which are unhealthy or deadly, and so forth...
    I actually find trading quite ethical. It is very abstractive. I do not know who I am buying from or selling to, and why they bought/sold.
    I follow strategies which have nothing to do with lying, deceiving, losing my soul. I think trading is a very honest profession, indeed, from the comfort of my house. Hey I even do not pollute the air with my car commute !
  7. I wasn't saying that traders lose money because they feel guilty about the fact that they are trading. I am saying that they may lose money because they truly don't feel deserving of it due to lack of hard work or something else. Of course there are exceptions.
  8. I don't know about you, but our top traders work 60-80 hours per week...perhaps not "breaking rocks" or digging ditches, but serious traders work pretty darn hard IMO.

    A guy guessing with a 5,000 share buy of GOOG and makes $50 on it might fit your profile, but not most serious traders.

  9. Andre


    I had a job once where it got pretty easy and I was making good money. I worked hard to get in that position. It was also kind of an unnecessary job, in more of the entertainment realm. But there was a time when I did feel a bit guilty for enjoying my job, and the freedom it provided that other didn't have. Not that I lost sleep over it. But it can be there.

    Alas, I haven't gotten good enough at trading to feel guilty!

    Sort of on the other side of feeling guilty, I remember not envy, but people sort of talking smack that I could do what I did for a living. That sort of sucked. Hell, my ex still doesn't think I work for a living as far as I know.
  10. excellent points. i definitely think that trading is more morally consistent than most jobs and less soul-draining....

    guilt in trading is ridiculous b/c you're not stealing from the poor or taking money from some more deserving or struggling person. people come into the markets to match wits with the GAME. if you're good, you win. if not, you lose. you know the risks going into it, so no one is duped. and if you lose, you hopefully don't lose the lesson.

    i think that if people feel they lost b/c they weren't deserving, that's ridiculous. if you lose, it's b/c you lack knowledge. there's a cure for lack of knowledge - it's called information. you read, you study, you learn. then you come back stronger and better. you develop a better method and become a better trader. it's really all up to you...that's what i love about trading.

    yes, i think some folks secretly (in denial) want to lose, to self-destruct. thankfully, i am not one of those people.
    #10     Dec 8, 2006