The 4 Levels Of Trading Mastery


states of emotion

This article is by our contributor and forex trader Goncalo Botelho:

In everything you do, you’ll find yourself confronted with a standard ladder of mastery.   Trading is no exception.

The 4 levels are:

• Unconscious Incompetent – when you have no knowledge and no experience

• Conscious Incompetent – you achieve this level once you’ve gathered some bit of knowledge, and can now recognize you still have a lot to learn and experience.

• Conscious Competent – when you have the knowledge and know how to use it, at this point you are starting to see great progress and results.

• Unconscious Competent – The last level of mastery at which point you perform the task with a crystallized behaviour and you no longer think about it, you just do it right and comfortably well.

A fair example of this ladder would be in driving. When we start, we are unconscious and incompetent, as we don’t know the Highway Code and don’t know how to operate a car. Then we learn the code and the basics of how to drive a car and become aware of what we have yet to achieve. We therefore passed to be conscious and incompetent. As we try to gather experience we have the knowledge but we are letting the car stall, braking too hard etc.

With further experience, we then progress to conscious competent, where we know the code and how to drive the car. However, we still are thinking and focusing on these tasks.

And then we finally achieve the last level of mastery where we become unconscious and competent, we no longer need to think about driving we just do it well. We don’t need to look to the gearbox anymore, pedals etc.

The unconscious competent level of mastery can be linked to the psychological state known as “flow” where you possess a very high skill level and you feel perfectly comfortable, with contained emotions, and can handle changes with ease. The flow state is the state you want to achieve whilst trading in order for you to be relaxed and successful.

This is all about you, so don’t focus on the others and how much they’re making and how well they are doing, instead focus on yourself. Be able to humbly recognize and pinpoint accurately where you stand in the learning process, embrace it and focus on your progress.

So what is your level of mastery? Let us know in the comments below and on facebook!

10 Comments

  1. I wish I understood your terms better. When you explain your reasoning you do so on an advanced level. Wish you could dumb down the language used, but only my beginners’ view.

    For instance why draw the green box? What do you use track the market? Why is this flat pattern a favorite flat pattern?

  2. I’d say I’m in the worry or anxious category; or the consciously incompetent category. I’m learning, and I’m trying. Prior to your webinar I was even more consciously incompetent than I am now as I’ve done (doing) long term speculation but never shorter term trading. Now that I’m trying to learn and using real cash I guess I do feel a bit like I’m learning how to drive – anxious or worried at times; excited at other times. Just like with driving a car, I gotta push past being incompetent to being competent. 🙂

  3. i sense i would be a short term trader. i also sense much,or rather an enormity of oppotunity in this direction the next two years. i’m going to start the webinars-my week of vacation starts tomorrow. need to learn to hedge. could i learn enough in thirty days? the webinars and what else…

  4. John – the very fact that you can admit that about yourself and that you are honest about your trading, is a very positive thing indeed. It is a good sign and it means you will progress to the next level and eventually to the top. You’re doing a good job. Trading is hard and very few succeed. So don’t be too hard on yourself. Alessio

  5. I have been buying/selling stocks for many years but without the disciplined approach which I now realise is an absolute requirement for investment success, e.g. I have constantly failed to get rid of my losers and watched many of my shares fall, fall, fall without taking the necessary action. With your help, I hope to correct this situation and start making some money!

  6. Move over, Deepak Chopra 🙂 I feel this is excellent advice high performance (and enjoyment) of any endeavour.

  7. Move over, Deepak Chopra I feel this is excellent advice for high performance (and enjoyment) of any endeavour.

  8. Thanks Veronica. I know of Chopra, very deep and meaningful stuff. I’ll pass your kind comments to Goncalo (the writer of this article). Cheers, Alessio

  9. I feel like I really really want to understand, but dont

  10. I am at the Conscious Incompetent level 2012 is going to be my breakout year hopefully i have just started trading recently near the end of 2011 but I have been learning Thanks to Alessio.

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