'Everybody gets what they want out of the market': Ed Seykota on Beliefs and Reality.

The Market as a Mirror

Ed Seykota's statement, "Everybody gets what they want out of the market," is one of the most profound and misunderstood quotes in the trading world. On the surface, it seems absurd. Who would want to lose money? But Seykota was not talking about conscious desires. He was talking about the subconscious beliefs and motivations that drive our behavior. He believed that the market is a giant mirror that reflects our inner world back at us.

The Desire for Excitement

Consider the trader who is constantly chasing volatile stocks and making impulsive trades. They may say that they want to make money, but what they really want is excitement. The market provides them with the adrenaline rush they crave. The problem is that this kind of trading is rarely profitable in the long run. The trader gets the excitement they want, but at the cost of their trading capital.

The Need to Be Right

Another common subconscious desire is the need to be right. This is the trader who holds onto a losing position, unable to admit that they made a mistake. They may even add to the position, averaging down in the hope that the market will eventually prove them right. This is a recipe for disaster. The market does not care about your opinion. It is what it is. The trader who needs to be right will eventually be humbled by the market.

The Path to Congruence

So how can a trader overcome these subconscious desires and align their actions with their conscious goals? The first step is self-awareness. You must be willing to look honestly at your own behavior and to ask yourself what you are really getting out of the market. A trading journal can be an invaluable tool in this process. By recording your thoughts and feelings along with your trades, you can begin to see the patterns in your behavior. The second step is to work on changing your underlying beliefs. This is not easy, but it is possible. The Trading Tribe was one way that Seykota helped traders to do this. By working with a group of supportive peers, traders could challenge their limiting beliefs and develop new, more empowering ones.