Recognition — Part 4
The Money Problem
As you move deeper into the process of refinement, you start to run into a problem that doesn’t go away as easily as you might expect. Some call it the PnL problem, or “being too attached to the outcome.”
But for me, those descriptions always felt too vague. The issue seemed deeper than that. If I had to reduce it to a single word, it would be this: Dopamine.
In the beginning, the attachment is obvious. You’re focused on making money, and every win or loss pulls your emotions to one extreme or the other. When that happens, your ability to execute breaks down.
The common advice is simple:
When you feel tilted, step away. Reset. Come back later.
And to be fair, that works—at least on the surface. But it’s a band-aid. It doesn’t address the root problem. It just gives you enough distance to function again. You’re still attached to the outcome. You’ve just paused the reaction.
My first attempt at solving this was to reduce my position size to the point where the result didn’t matter. The idea was that if I removed the emotional weight, I could focus on planning and execution. And once that improved, I could scale back up.
On the surface, it made sense. And it worked for a while. But looking back, it was just a way of dulling the feeling. It didn’t solve the problem, it avoided it. Because the real issue wasn’t the presence of emotion, it was my inability to operate within it.
Earlier, I had already started shifting away from wanting to make money, toward wanting to become a better trader. But in trying to solve the “money problem,” I created a new version of it.
As I started reviewing my trades, my thoughts, and my decisions more closely, something became obvious:
I was still attached to the outcome. Even when the money didn’t matter. So, the question became why? If the money on the table wasn’t meaningful, why did the result still affect me?
Because the attachment had changed shape. It was no longer about money. It was about what the outcome meant. A good trade felt like progress and a bad trade felt like regression.
And without realizing it, I had started chasing that feeling. Not the process. Not proper execution. The feeling of improvement, instead of the improvement itself.
A good trade doesn’t always result in a win, and a bad trade doesn’t always result in a loss. A good trade is one where I follow my plan, manage risk, and respond to what’s happening in the market. Sometimes that means taking a loss early, sometimes it means doing nothing at all.
We must always remain mindful of what progress actually looks like, doing the right thing will often feel unrewarding, or even punishing at times, but it is not the result of a trade that determines it’s repeatability. Rather it is the process by which that trade came about.
An old Karate instructor I learned from as a child had a saying that’s always stuck with me:
“Practice does not make perfect, perfect practice makes perfect”
If we simply repeat the same process and execution while only paying attention to the results, we will learn nothing about our system. Our system, in order to maintain longevity, must be a continuously developing decision making process. The risk assigned is not just another variable in that process, it is the flame by which the process is forged and tempered.
Without that heat, without the real possibility of losing money, you are not practicing the full breadth of what the game of trading is about. Traders on funded accounts and paper traders will come to this problem far later in their careers than necessary, and that will make the obstacle that much harder to overcome as a result. Deal with this problem now, accept that risk and uncertainty aren’t just part of the game, they are the very thing you are trying to take advantage of whenever you are entering into any position. You must become comfortable with these tools, despite your fear of being burned or losing a finger.