Mindset #1 – Why are you Scared of Risk?

For my first post in my mindset series, I should include a little bit of an introduction on what I’m trying to achieve. I’m still a Twitter guy at heart and love my @forexbrokr handle for having the ability to instantly get my thoughts out to my community, then instantly get feedback and real reactions from other people. The discussions that stem off these simple, 140 character tweets are sometimes mind blowing and it's something that is perfect for a short form medium like Twitter.

However, there are times when the short form discussion just doesn’t allow me to go as deep into the concepts that I really want to explore. Replying to yourself and threading tweets works, but it can get confusing very quickly. I want to go deeper.

It’s for this reason that I want to create a Steemit blog series to expand on some of the ideas that I Tweet, and give the community a chance to discuss the mindset concepts within them, in much greater depth.

Let's get straight into it!

Why are you Scared of Risk?

Clearly Define Your Risk and you Have no Reason to Stress

I’m sure you’ve heard the old cliché "the biggest risk of all, is not taking any risk." Now with my trading background, this is a pretty straightforward comment. You need to be in the market to have any chance of making money. But can we apply that same thinking to your wider life choices that everyone, if they're ever going to go somewhere further in life, has to make.

The key here is not to be scared of risk, but instead to clearly define your risk. If you understand the risks involved and have clearly planned for the absolute worst case scenario you can picture, then why should you be scared? You know the exact set of circumstances that are going to cause that scenario to ensue, so the shock factor is gone. Why would you still be scared of the risk?

It's just a part of the process of change. Either in your trading account, or yourself as a person.

Being scared of risk is a dangerous mindset that you shouldn't, under any circumstances, let consume you. I'm going to throw something a little controversial out here, but I believe that being scared of risk is inherently because you're a lazy person. You hide that with but really you just can't be bothered to put in the time and effort that is required to asses your scenarios, understand them and put plans in place to not only prevent the ones laced with risk, but to mitigate them if they play out. If you understand the scenarios that will see a certain risk play out, then you have nothing to be scared about.

Risk is purely an emotion. Be in control of your emotions by meticulously planning your scenarios and you will be happy to take it on.

Life Scenario and the Risk:Reward Ratio

The simplest, and most common real life scenario that I find people that I speak to are face, is this: You don't like where your life is headed and want to make a change. You find that you hate the line of work that you have fallen into, but can't leave to better your life because you need the money it provides to feed yourself. You are unable to make this happen because you need money NOW and can't risk the income tap being turned off. I know plenty of you will relate to this risk and being asked it so often is the driving motivation behind this post.

But just because it's relatable on a human level doesn't make it anything less than complete bullshit. Yeah, there you go. I said it.

You literally have just told me your worst case scenario. You understand the biggest risk being that if you leave your time consuming, low paying, dead end job today and you aren't able to immediately replace that income tomorrow, then you feel you're fucked. But again, that isn't being scared of risk. That is quite simply being too lazy to bother doing your scenarios and choosing the one that allows you to make the change that you said you need. Come on.

Don't ever sit there and tell yourself that the risk is too high. Work out your risk:reward ratio and then run through all of the possible scenarios that would inflict the most pain on yourself and manage solutions around them. Only when you have meticulously planned every single possible scenario, will the emotion of risk dissipate. If you know what's coming, you can't be surprised or scared. If you don't put effort into scenario planning however, then you're going to be hurt.

You literally have no excuse to not make something happen in your life. Go.