I was having a drink with a venture capitalist recently, and he was gently lecturing me on controlling my urges around pretty girls.

Every day, he told me, he sees incredible opportunities – stuff he gets really fired up about. People he knows will make it … services he knows will be an instant hit …

But he knows that he can’t kiss all the pretty girls. If he invested in every one of these opportunities, he’d be spread so thin that it would become unmanageable, and his profits would suffer as a consequence.

Why was he lecturing me?

He’d caught me at my smart phone, trying to catch another trade, when I’d already told him that I was 3% up on my trading that day.

It’s a real problem for me.

If I don’t have any position open in the market, I feel like I’m not doing my job properly.

I only have to open a chart on my screen and I get a strong urge to open a trade.

I hope you don’t have this addiction, but I suspect it’s more common than most traders will admit.

Here are some tell-tale signs that you might have problem with ‘pretty girls’ too…

1. If your usual chart indicator isn’t giving you a signal, do you switch indicators to find one that does? (I know that if I look for long enough, I’ll find something that’ll tell me there’s a trade setting up!)

2. Do you think that trading more often will make you more money? Surely, if you’ve a profitable strategy, the more you use it, the richer you’ll get – no? NO. Not all trades are equally profitable in any strategy. We need to be discerning and stick to the best trade set-ups.

3. Do you tell yourself after a losing trade that it could have won “IF ONLY” you’d done x or y. You tell yourself that you’ll do x or y next time, and it’ll work out fine. In fact, you’re going to find a trade right now to prove the point! (The truth is that next time, the thing you should have done, would be “z”!)

4. Do you keep moving down the timeframes, seeking action? There’s nothing happening on a 1-hour chart, so you check out the 15-minute chart … then the 5-minute … and so on.

5. Do you keep adding new instruments to your repertoire? Have you caught yourself trading weird currency crosses in the middle of the night? (You’ve got a problem.)

6. Do you get twitchy when you’re out of the market? Are you constantly checking markets on your phone? And getting worried that you might miss the next big move?

If you’ve answered yes to any of these questions, then you’re in good company. I’ve suffered from a compulsion to over trade for a long time, and I hope I’m learning to keep it in check.

Here are some of the methods I’ve found to work …

The cure

1. Have a strict percentage of your fund that you risk on a trade, and a limit to the number of trades you can have open at once. That way, you can’t decide to open a few “extras” at lower staking levels (a game I used to cheat myself with).

2. Have clear trading rules for the signals that will get you into a trade (these include the markets and the timeframes you’ll trade). Plus, have a rule for the hours you’ll trade.

3. Set yourself a daily profit/loss limit. So, once you’ve had, say 5 winning trades in a day – stop trading. Likewise, if you’ve had 3 losers in a day – stop trading.

4. Be realistic about the kind of profits that trading can make. If you’re expecting to make 200% profit in a year, you’re going to need to trade like a mad man to chase that goal. Trading success is a long-term goal. We shouldn’t go chasing trades – let them come to us.

5. Don’t be too hard on yourself. We all make mistakes with our trading. Hopefully, we learn something along the way, and will be more profitable next time.