What Stands in the Way of Trading Success? (25 Overarching Issues)

What actually stands in the way of trading success?

Let’s go up a level and think about the big things that hold back success in anything.

We practically all have something (or many things) holding us back from achieving what we’d ideally hope to achieve.

So, it’s important to identify these big things and deal with them. You can either fix them yourself or seek help from others.

Having humility and being open to feedback is just as important as having strengths yourself.

Key Takeaways – What Stands in the Way of Trading Success?

• Inability to Identify Problems
• Emotional Barriers
• Lack of Self-Discipline
• Poor Communication Skills
• Inability to Accept Criticism
• Lack of Adaptability
• Surrounding Yourself with the Wrong People
• Not Learning From Mistakes
• Lack of Clear Goals
• Inability to Prioritize
• Resistance to Change
• Poor Time Management
• Lack of Resilience
• Inability to Delegate
• Fear of Failure
• Fear of Success
• Overconfidence
• Inability to Handle Stress
• Lack of Financial Literacy
• Lack of Flexibility
• Fear of Taking Risks
• Lack of Self-Accountability
• Not Seeking Help When Needed
• Procrastination
• Negative Mindset

Examples of Important Things That Hold Us Back

1. Inability to Identify Problems

Being unable to identify problems is a significant obstacle to success. It’s like having a thorn in your foot that you don’t know about. You keep walking, but the pain slows you down and eventually stops you.

Problems are opportunities to improve. If you don’t see them, you can’t fix them.

To identify problems, you need to compare the results you’re getting with the goals you set. If there’s a gap, that’s a problem.

For example, if you aim to grow your investment/trading portfolio by 10% this year but it’s only grown by 2%, what are the factors behind that and how can you improve performance? (There are always outside factors, but what can you do specifically?)

You also need a system to monitor your progress. This could be a weekly review of your portfolio or a monthly check-in on your business performance.

Look for deviations from what you expected. If you don’t, small problems can become big ones.

Finally, don’t be afraid to ask for help. If you’re struggling to identify problems, ask someone else to take a look. They might see something you missed.

Acknowledging a problem isn’t the same as accepting it. It’s the first step toward overcoming it. So, don’t sweep problems under the rug. Celebrate finding them so you can make things better.

2. Emotional Barriers

Emotional barriers can be a significant obstacle to success. Some emotions can drive things like creativity and passion, but they can also prevent you from seeing the truth, making rational decisions, and taking necessary actions.

The idea of facing the unvarnished truth can induce anxiety. But untruths are scarier than truths.

If you’re sick, it’s natural to fear your doctor’s diagnosis. As scary as the truth may turn out to be, you will be better off knowing it in the long run because it will allow you to seek the most appropriate treatment.

The same holds for learning painful truths about your own strengths and weaknesses.

It’s important not to get hung up on all the emotion- and ego-laden stuff that can distract you from the overall mission.

If you don’t let up on yourself and instead become comfortable always operating with some level of pain, you will evolve at a faster pace.

Every time you confront something painful, you are at a potentially important juncture in your life – there’s the opportunity to choose healthy and painful truth or unhealthy but comfortable delusion.

Like switching from not exercising to exercising, developing the habit of embracing the pain and learning from it will help you improve.

If we want to evolve, we will need to go where the problems and the pain are. Confronting the pain, you will see more clearly the paradoxes and problems you face.

Reflecting on them and resolving them will give you wisdom. The harder the pain and the challenge, the better.

Because these moments of discomfort are so important, you shouldn’t rush through them. Stay in them and explore them so you can build a foundation for improvement.

Embracing your setbacks/failures – and confronting the pain they cause you and others – is the first step toward genuine improvement.

3. Lack of Self-Discipline

Lack of self-discipline is a significant barrier to success.

It’s like trying to run a marathon but stopping to smell every flower along the way. You might enjoy the flowers, but you won’t finish the race. Success often requires a lot of hard work and dedication.

Without self-discipline, it’s easy to get distracted or procrastinate. You might find yourself doing what you’d like to do instead of what you must do.

Emphasize the importance of separating your “need-to-dos” from your “like-to-dos” and making sure all your “need-to-dos” are done before you move on to your “like-to-dos.”

As we covered here, good work habits are highly underrated. People who push through successfully have to-do lists that are prioritized well, and they make certain each item is ticked off in order. This requires discipline. It’s not always fun, but it’s necessary.

If you’re building a house, you have to lay the foundation first, even if it’s not the most exciting part of the process.

So, if you lack self-discipline, you might find yourself jumping from one interesting task to another, never finishing anything or doing it to the level necessary.

Or you might put off the hard tasks until the last minute, which can lead to poor quality work and stress.

But if you can develop the discipline to focus on your “must-dos,” to stick with tasks even when they’re boring or difficult, you’ll be much more likely to achieve your goals.

Success necessarily comes after the struggle of hard work.

4. Poor Communication Skills

An inability to express ourselves well is like trying to sell a product without being able to explain what it does or why it’s useful. You might have the best product in the world, but if you can’t communicate its value, it’s hard to sell it.

In any conversation, both parties have a responsibility to express themselves clearly and to listen carefully. Misunderstandings are always going to happen, but they can be minimized by repeating what you’re hearing someone say to make sure you’re actually getting it.

Start by assuming you’re either not communicating or listening well instead of blaming the other party. Learn from any miscommunications so they don’t happen again.

You can also be open-minded and assertive at the same time. This means seeing things through the other person’s eyes while also communicating clearly how things look through your eyes.

It’s easier to convey how you see things than to understand how others do, and people tend to have ego attachments to being right (which of course can cost you dearly in the markets).

Those who change their minds in response to new evidence, data, and information are the biggest winners because they learned something, whereas those who struggle with that are unlikely to improve.

Also, communication issues are often caused by differences in perspective, as people who see and think one way often struggle to connect with or relate to those who see things differently. Working through these differences requires a lot of patience and open-mindedness, as well as triangulating with other people who can help fill in the picture.

So, if you’re struggling with communication, consider whether you’re really hearing what the other person is saying and whether you’re really making your own point clear.

And it’s not about winning an argument, it’s about finding the best path forward.

5. Inability to Accept Criticism

Accepting criticism can be challenging, but it’s essential for growth. When you receive criticism, see it as valuable feedback that can help you improve.

If you can’t accept criticism, you might miss out on opportunities to learn and grow. Accurate criticism is more valuable than compliments. It helps you identify your weaknesses and work on them.

Knowing your strengths and weaknesses will help you seek the most appropriate way to improve. Each mistake is an opportunity to learn and grow. When you solve the puzzle of a mistake, you gain a gem of knowledge that saves you from making similar mistakes in the future.

And while not all criticism is valid, embrace criticism and use it as a means for personal and professional development.

6. Lack of Adaptability

Adapting to change is important for survival because the world is constantly changing in various ways.

If you do the same things with the same inputs, you should expect the same results.

So, if you want different results, you need to ask yourself, “Who should do what differently?”

Be clear about what you’re doing and why, and being open to honest feedback from others.

7. Surrounding Yourself with the Wrong People

Surrounding yourself with the wrong people can hold you back.

It’s like trying to run a race with weights on your legs. If the people around you don’t share your values or goals, it can be a constant drag on your progress.

You want to surround yourself with people who complement your strengths and weaknesses, and who share your commitment to your goals. This is one of the keys to success, whether in your private life or your work life.

For example, think of an investment team or trading firm.

• Some are good at the big-picture stuff, but not as good at turning this knowledge into good trade ideas.
• Some are good at analyzing specific types of companies or securities, but struggle with the overarching investment stuff like having a great strategic asset allocation and the risk management aspect.
• Some are good at designing portfolio structures, but aren’t as effective at risk management and doing things within acceptable risk parameters.
• Some can effectively spot risks, but aren’t good at identifying the appropriate decisions required for the necessary growth to occur.

These different strengths and weaknesses can complement each other. Strengths can negate weaknesses when the team and responsibilities are designed well.

So, think about the people you’re surrounding yourself with. Are they helping you move forward, or are they holding you back?

If it’s the latter, you might need to make some tough decisions about who you’re spending your time with.

8. Not Learning From Mistakes

Not learning from mistakes is a common pitfall that can hinder progress. Everyone makes mistakes, but the key is to embrace them as opportunities for growth.

When you make a mistake, it’s important to diagnose the root cause and learn from it, so you don’t repeat the same error in the future.

Surrounding yourself with people who share this mindset and creating a culture where it’s okay to make mistakes, as long as you learn from them, will help you and your team achieve better results.

Be clear about root causes vs. proximate causes.

For example:

• Proximate Cause – The person forgot to submit the project on time because they were distracted by a series of last-minute emails.
• Root Cause – The person has poor time management skills and failed to allocate sufficient time for completing the project ahead of the deadline.

The proximate cause explains what immediately led to the mistake, while the root cause identifies the underlying issue that made the mistake possible.

Addressing the root cause – improving time management – prevents similar mistakes in the future, while fixing the proximate cause only addresses the immediate incident.

9. Lack of Clear Goals

Having clear goals is like having a compass in the wilderness. It gives you direction and helps you stay focused on what’s important.

Without it, you might find yourself wandering aimlessly, wasting time and energy on things that don’t bring you closer to what you truly want.

So, if you feel lost or unmotivated, it might be because you lack clear goals.

Take some time to reflect on what you really want in life, what you’re passionate about, and what you want to achieve.

Write these goals down and keep them somewhere visible to remind yourself of them every day.

Now, think about your current goals. Are they clear and well-defined? Do they align with your passions and values? If not, what changes can you make to ensure they do?

10. Inability to Prioritize

When everything feels urgent, it’s easy to become overwhelmed. Not all tasks are created equal, and you need to choose what’s most important to you and focus on that.

Use concepts like the Eisenhower Matrix to distinguish between urgent and important tasks.

Urgent and important comes first while non-urgent and unimportant tasks you can probably do away with altogether.

Think of the 80/20 rule. In many cases, a small fraction of your inputs create the bulk of your outputs. Focus on that and do more of it, if applicable.

Create a daily priority list and tackle the most critical items first. This way you free up mental space and ensure progress toward your goals.

Don’t get bogged down in the details of each task, instead pay attention to building and managing your machines, your systems and processes.

This way, you’ll be able to handle multiple tasks without feeling overwhelmed.

11. Resistance to Change

Resistance to change is natural, but it’s important to understand that the world is always evolving. If you resist change, you might find yourself left behind.

People typically don’t change that much, especially over short periods.

So, if you’re resisting change, it’s likely you’ll continue to do so unless there’s good evidence to suggest otherwise.

When facing a change, ask yourself if you’re being open-minded or resistant. Confront your difficulties head-on and explore where they come from. This will help you learn and grow.

12. Poor Time Management

Poor time management can make it seem like there aren’t enough hours in the day to get everything done.

As mentioned, prioritize tasks that are most important. By focusing on what needs to be done first, you can make the most of your time and increase productivity.

Effective time management is about making conscious choices on where to spend your time, and it’s always better to complete high-priority tasks before moving on to less critical ones.

13. Lack of Resilience

When you face setbacks or difficult situations, it’s important to remember that these are a natural part of life. If you’re not resilient, you might find it hard to bounce back from these challenges.

From a young age, we’re trained to be embarrassed by making mistakes or not knowing, but mistakes are opportunities for learning and growth.

Every mistake you make and learn from will save you from making similar mistakes in the future.

Knowing how to deal well with your setbacks is as important as knowing how to move forward.

Sometimes, you might find yourself in a situation where you’re going over a waterfall and there’s no way to avoid it.

In such times, your goal might be to keep what you have, to minimize your rate of loss, or simply to deal with a loss that is irrevocable.

Your mission is to always make the best possible choices, knowing that you will optimize your situation if you do.

Getting what you want comes from a mix of cleverness, help from others, and determination. With those things, it is almost always possible to eventually succeed in getting what you want.

14. Inability to Delegate

Trying to do everything yourself can lead to burnout.

It’s like trying to be the conductor and play all the instruments in an orchestra at the same time. It’s not practical or effective.

Instead, focus on orchestrating others to achieve what you want. This means clearly defining roles, responsibilities, and expectations, and then trusting others to carry out their parts.

If you’re finding it hard to delegate, it might be because:

• a) you’re either not clear about what you want, or
• b) you don’t trust the people you’re delegating to

In the first case, you need to spend more time thinking about what you want to achieve and how.

In the second case, you either need to train your people better, or find better people to delegate to.

15. Fear of Failure

Fear of failure can be paralyzing, but mistakes aren’t just inevitable, they’re valuable.

When you make a mistake, you learn something. It’s like solving a puzzle – once you figure out what went wrong, you can avoid making the same mistake in the future.

16. Fear of Success

On the other hand, fear of success can be just as debilitating.

It can prevent you from reaching your full potential because you’re afraid of the unknown or the added responsibilities that come with success.

17. Overconfidence

While confidence is important, overconfidence can lead to blind spots.

Thinking you have all the answers might prevent you from seeking input, recognizing areas for improvement, or seeing the downsides.

This is why it’s important to diagnose problems to get at their root causes.

If you’re too confident, you might not take the time to do this. You might brush off problems as one-offs (“it wasn’t my fault the weather ruined my trade”) instead of using them as opportunities to improve your approach.

For example, if you make a bad trade or investment, instead of just moving on to the next opportunity, you should take the time to understand what went wrong.

Did you misjudge the market? Did you ignore certain risks? By getting to the root cause, you can learn from your mistake and avoid making the same one in the future.

18. Inability to Handle Stress

High levels of stress can impair decision-making and overall performance.

It’s important to allow time for rest and renovation just as you would make time for all the other stuff that needs to get done.

It’s also important not to get frustrated. Life is full of ups and downs. There will be times when things don’t go as planned.

Instead of getting frustrated, see these as opportunities to learn and grow.

Everyone has too much to do. The key is to prioritize, delegate, and improve productivity. This way, you can manage stress effectively and perform at your best.

19. Lack of Financial Literacy

Understanding how to manage finances is critical for long-term success.

You need to decide what you want, understand what’s true, and then figure out what you should do to achieve your goals in light of that truth.

This requires humility and open-mindedness, so you can consider the best thinking available to you.

For example, if you want to retire comfortably, you need to understand the reality about your current financial situation, your future income needs, and the investment options available to you.

Then, you need to make a plan to achieve your goal, which might involve saving more, investing wisely, or even adjusting your retirement expectations.

So, if you lack financial knowledge, it’s important to learn or seek help. There are many resources available, from books to financial advisors.

Be sure they’re qualified to give advice. Friends and family might mean well, but what they say can be harmful if they aren’t qualified to give advice.

There’s a lot more complexity, nuance, and depth to financial matters that won’t be apparent to those without the proper training.

20. Lack of Flexibility

Being too rigid in your thinking or methods can lead to missed opportunities and a failure to adapt to changes.

Open-mindedness is about being open to the possibility that you might be wrong and that there might be better ways of doing things.

It’s about actively seeking out different perspectives and considering them thoughtfully, even if they challenge your existing beliefs or plans.

When you’re open-minded, you’re able to learn from reality and adjust your approach as needed.

For example, if you’re working on a project and you encounter an unexpected obstacle, instead of sticking to your original plan, you would look for alternative solutions and be willing to change your approach if necessary.

It’s the same in alpha generation in markets. Not everything lasts.

Markets change and people figure out what they were formerly missing.

Even today’s modern analytical approaches that are causing some market players to thrive will eventually get beaten to death and no longer convey an edge.

Flexibility allows you to adapt to changing circumstances and take advantage of new opportunities.

It’s not about being indecisive or lacking conviction, but about being willing to question your assumptions and consider different possibilities. This can lead to better decision-making and ultimately, greater success.

Seek out different perspectives, question your assumptions, and be willing to adjust your plans if necessary. This can help you stay flexible and adaptable, which can lead to better outcomes in the long run.

21. Fear of Taking Risks

Fear of taking risks can hold you back, but it’s important to remember that setbacks are a natural part of the process. When you face a setback, instead of feeling bad about it, view it as a learning experience.

For example, when you make a trade or investment that doesn’t work out, don’t feel bad about it. Instead, analyze what went wrong and use that knowledge to make better decisions in the future.

If you’re afraid of taking risks, remember that every successful person has experienced failure along the way. It’s not about avoiding failure, but about learning how to fail well and use those experiences to grow.

See each setback as a sign that you need to be more creative, flexible, or determined.

22. Lack of Self-Accountability

Lack of self-accountability is a serious issue because it means people aren’t taking responsibility for their actions and outcomes.

When you don’t hold yourself accountable, you’re more likely to make excuses, blame others, and fail to learn from your mistakes.

This can lead to poor performance, missed opportunities, and a lack of personal growth.

To avoid this, it’s important to clearly assign responsibilities, hold yourself and others accountable, and distinguish between failures with and without a clear “contract” or expectation.

23. Not Seeking Help When Needed

When you’re struggling with something, it’s important to seek help from knowledgeable people. This can provide important insights and help you overcome what you’re dealing with.

Who you ask questions to is important. Make sure they’re credible and have all the relevant information. Have they successfully accomplished the thing in question multiple times?

So, if you’re dealing with a challenge in your trading career, for example, seek advice from someone who has successfully gone through similar challenges multiple times and can explain the data, evidence, information, and reasoning that led them to their conclusions.

Opinions are easy for anyone to produce regardless of knowledge, skill, or ability.

Value reasoning over conclusions.

24. Procrastination

Procrastination is a common problem that can hold you back from achieving your goals.

It’s often caused by a lack of clear priorities, fear of failure, or simply not having good work habits.

To overcome procrastination, you need to develop good work habits and discipline. This means creating a to-do list that is prioritized well and making sure each item is ticked off in order.

As we mentioned earlier, it’s important to separate your “need-to-dos” from your “like-to-dos” and not mistakenly slip any “like-to-dos” onto the first list.

When you’re feeling stuck, remember why you’re working toward your goal in the first place.

Visualize the results of pushing through so intensely that you experience the thrill of success even while you’re still struggling to achieve it.

This can be a powerful motivator. Also, don’t be afraid to seek help from knowledgeable people.

Overall, staying focused on your goals, maintaining good work habits, and seeking help when needed can help you overcome procrastination and achieve your goals.

25. Negative Mindset

Having a positive mindset is critical because it helps you stay flexible and accountable.

When you believe in yourself and your abilities, you’re more likely to find alternative paths to achieve your goals when faced with setbacks.

There are typically many viable paths to achieving your goals, and you just need to find one that works well for you.

Dealing well with setbacks is as important as knowing how to move forward, so don’t let discouragement stop you from finding a way to succeed.