The nice people at MoneyMagazine published one of Louise’s articles this month, called “I want to make rules, not follow them.”
This is what they said: “A devastating medical condition set Louise Bedford, author of five books on the stockmarket, podcaster and behavioural finance expert, on a new wealth-creating path.”
Get prepared for a huge chunk of inspiration.
We’ve extracted the information to this post for easy reading!
I want to make rules, not follow them
It all started for me around 30 years ago. I went to a seminar about the sharemarket and I thought to myself, “It’s about time I took control.”
I was flying high as a national manager for a large multinational company. I started to trade alongside my job and then the unexpected happened: I lost the use of my arms through an unexplained tendon condition.
Even simple tasks such as opening doors were a painful daily struggle. I had to quit my terrific job and told my accountant that I was going to trade full-time.
He laughed in my face and told me that barely anyone makes it as a full-time trader. I got angry… really angry.
And then I learned how to type with a pen in my mouth. It opened up a whole new world for me. I could trade shares online and email my friends. It meant freedom.
I’ve regained the use of my arms and set up a podcast and a mentor program with my business partner to teach other people how to trade the markets.
Trading and investing is where you buy and sell stocks and aim to make money on price changes. This can be over a longer term, where investors buy stocks and wait for the prices to go up. Or you can make money following the short-term trends.
Having been brought up with very few material possessions, and where there always seemed to be more month left over than money available, I felt acutely aware of a lack of money.
Watching my mum go without a winter coat so her children could have warm clothes, and seeing how the very real dynamics of feeding four children on a minimal budget affected her, made me realise I desperately wanted my life to be different.
One of Australia’s most successful businessmen dismissed me in the early days: “You’re a woman, you’ll never make it as a trader. It’s an old boys club.”
This societal attitude has changed over time. In more recent years, it has become evident that female fund managers and traders are outperforming their male counterparts. I overcame gender-based obstacles by looking at the facts and ignoring anything (or anyone) that didn’t conform to the data.
Recent research suggests that parents speak to their daughters differently about money compared with their sons. Sadly, parents might be socialising their children differently, inadvertently leading to less confident female adults when it comes to investing.
This has influenced the way I speak to my own daughters and nieces about money. I am more determined than ever to level the playing field and positively influence the money scripts of the next generation.
The emotions experienced by traders are fascinating to study. I was always interested in finding out why people say one thing but act in a totally different way.
Studying psychological fitness and the mindset of traders was partially self-serving initially, so I could regulate my own emotions.
However, as time went on, it became a focus as it became evident that this was one of the most significant areas where I could help traders excel.
The secret to being a successful trader is to keep your ego in check when things are going in your favour, and to persist when times are tough. Know when you’re out of your depth and you need to turn to a mentor for help.
The key mistakes I made when starting out revolved around not understanding the importance of risk management. I took far too many risks, not understanding the potentially catastrophic consequences that were just around the corner.
Now, when presented with an opportunity, I use the pre-mortem method. This is where you imagine that the project you’re about to be involved with has failed abysmally about one year into the future. Then you consider all of the possible reasons why this could have occurred, as if you were looking back on the entire fiasco.
Once you’ve isolated the potential areas for catastrophe, you then review your plan and work out possible ways to plug any holes that could lead to a negative eventuality in the future.
I’ll always remember that when I was about eight years old my grandmother said: “She who has the gold, makes the rules.”
It was then I realised I wanted to make money and not be reliant on anyone else. I wanted to be the one to make the rules, rather than be the one who always had to follow them.