Chapter_1_Flashcards
(12 cards)
What is the main goal of Chapter 1 in ‘Good Trading, Bad Trading’?
To help traders return to a clear, calm mental state by recognizing and escaping the psychological traps that cause emotional, addictive trading.
Why do most traders fail according to this chapter?
Because they’re caught in a psychological loop, trading for emotional relief rather than based on logic or analysis.
What are the two monsters described in this chapter?
The Little Monster (withdrawal itch after a bad trade) and The Big Monster (false promise that a revenge trade will feel good).
What does the Little Monster represent?
The subtle discomfort that arises after a bad trade, creating an urge to ‘fix’ the loss through another trade, driven by unease and emotional withdrawal.
What does the Big Monster represent?
The belief that a revenge trade will bring relief, control, or satisfaction — it’s the illusion that a bad trade can make you feel powerful again.
Why is feeding the Little Monster dangerous?
Because it reinforces a cycle of trading to escape discomfort, leading to impulsive decisions and emotional dependence on trading outcomes.
Why is the Big Monster considered more dangerous than the Little Monster?
Because it sells the illusion that a revenge trade will bring emotional resolution, tricking you into deeper dependence even after winning.
What is the key to escaping the influence of the two monsters?
Seeing them clearly for what they are — mental loops — and realizing they have no real power unless you believe in them.
Why don’t willpower and discipline work long term against bad trading habits?
Because they suppress the behavior without removing the underlying belief that trading will bring emotional relief, so the craving eventually returns.
What mindset shift does the chapter encourage instead of using willpower?
To gain clarity and awareness — once you truly understand the illusion, you no longer want to trade for emotional relief, making willpower unnecessary.
What is the first instruction given in this book?
Recognise the two monsters — and never feed them again.
What should you say when you feel the urge to trade out of emotion?
“Ah — it’s just the monster talking.”
