The Fear of Being Wrong

Today I was talking to a dear friend that wanted to be a trader but that her attempts to getting started always resulted in failure and a such a shame associated with that original failure that she could never find the courage to start again. Indubitably, there are different personalities, some of which may appear not to be suitable for trading. One needs to be a bit of a gambler, able to recognize and recover from one’s error quickly. But every personality, I believe, has features that can give the trader an edge over others. I suggest you look for the descriptions of the Enneagram, and find your own personality type. Under the Enneagram, my personality is identified as “8”. My friend is a “1”, and as such, she has the tendency to avoid mistakes at all costs. But the personality 1 has many great features such as the capacity to identify details, to follow a set of rules, to be methodical and a keen interest in learning. I believe that these features could be fair more valuable than the risk-taking feature of the number 8. Understanding your personality may be a great asset when it comes to trading. So look for books on the Enneagram, and learn out your own personality.

So how could a personality “1” be a great trader? by looking at trading as something to study and master, understanding that this is a discipline an “inexact science” if you will but a science none the less. Look at each trade as an experiment that will lead you to the answers you seek, rather than a task to be done perfectly. Each trade may give you information, whether the trade is profitable or not. If you are a “1”, you are a perfectionist, but we are not seeking a perfect result, we are seeking information to improve our methodology so that in the end we profit consistently.

Another great feature of personality 1 is there capacity to look back and pinpoint their errors in judgment and keep them in mind going forward. The secret for them is not to look at the errors as faults to be penalized for, but rather to guidance for course correction. Even if you failed miserably in the past, think of your errors as the seeds of an equal or greater benefit in the future, to paraphrase Napoleon Hill. Think of it! the greater the error, the greater the benefit in the future. This very blog was more the result of my failures than my successes. If I had not met with failure at very important points in my trading career, I would have probably not felt the need to share my experiences with others, in the hope that I could find answers to consistent trading. The PCCRC is the direct result of my loss of capital when AAPL fell from the mid 60’s to the high 20’s overnight, in Sept 29, 2000. After that dreadful event, I decided never to buy stocks gain. The PCCRC is my answer to trading great stocks without fearing the overnight collapse, without the fear of being wrong.


The new century brought us a variety of technologies we can use to trade better than the professionals using our personal computers at home. Further, we can explore any theory of trading we might have and test it in real life, without ever spending one penny. Here are three tips on how to put your learning in warp speed, without losing money:

Optionetics Platinum. Before I bought my first PCCRC, I tested dozens of them using this web-based software, that allowed me to look at different markets scenarios, different stock and different volatilities. I could easily locate candidates as if it was today. No other software can do this. A less powerful approach is to use TOS Thinkback feature.

Paper money trading. TOS’s paper money platform is almost identical to the real cash account. You could test your ideas as if it was a real account. I keep to this day, a paper trading account I started in June 2007 in order to show the members of my private group what I do and how profitable the PCCRC can be. You can adjust the amount of capital in the account too, to make it more realistic.

Day trading with TOS. I have discovered that using the 1 min charts I can use a variety of T.A. patterns in a very short period of time. Using this approach I can see in just a few minutes what would take me months to see in a real time chart. Here I can test my combination of oscillators and moving averages. My findings can then be applied to daily charts to swing trade options.

My friend can do her due diligence and begin to trust herself. I don’t have to teach her anything, she can teach herself. She can do as I did, see what others do and make up my own mind as to what is a good idea. Her scientific mind, I am sure, will produce great results, once she overcomes the fear of being wrong!