“We are shaped by our thoughts; we become what we think. When the mind is pure, joy follows like a shadow that never leaves.”
–Gautama Buddha
“Joy does not simply happen to us. We have to choose joy and keep choosing it every day.”
–Henri Nouwen
In 1994, I made my first visit to Beverly Hills, California. I have to admit that my expectations of the place were set as a young boy watching the sitcom about Jed Clampett and his transplanted family called the Beverly Hillbillies. (I may be dating myself here but can I add that I was very young when that show aired?) I expected the opulence and exclusivity represented in the TV show. What I experienced was so different than what I expected that it has stayed with me to this day.
Heapin’ Helpin’ of Hospitality?
My business trip was in support of a product that was in my portfolio at DuPont – a high strength liner used that capitalized on the high tensile strength and lightweight characteristics of Kevlar® to refurbish pipes (Kevlar is the same fiber used in bullet-resistant vests). Believe it or not, Beverly Hills really does have some big hills so the pressure from heavy rains and big elevation drops was blowing apart their storm drainage system. A construction company was using our material to reinforce existing storm water pipes. It was a cool project and I was onsite as part sales rep and part technical support (even in a marketing role, an engineer can hide his true colors for only so long…).
While there, I saw some great houses – the ones built into the sides of hills were striking. More than anything else, however, I took away one primary observation from this very affluent area – the people in Beverly Hills were unanimously and almost comically unhappy! Everyone was grousing about something. We weren’t digging up or disturbing anyone’s yard – we were just relining the existing storm drain pipes. Every interaction I had, whether business-related or just meeting someone in passing had an air of heavy discomfort and dissatisfaction. It wasn’t just me being treated inhospitably as an outsider either – I observed neighborhood people treating each other with the same air of melancholy.
Fast forward two years for a striking difference at another job site location. My company sent me to St. Maarten, the Dutch half of an island in the Caribbean for a new business assignment. I was working on a saltwater desalination project involving a village far above the beautiful coastline and posh resorts. The residents of this village were dirt poor. So poor in fact that when we were walking through the unpaved streets, our local engineer host pointed to a narrow ditch and said, “Don’t step in that.” I immediately saw (and smelled) why – untreated sewage ran through the open ditch and headed downhill out of the village to the ocean.
Amazingly, these people who lived practically in squalor, were quite happy. Kids laughed and played with makeshift toys and balls. Everyone smiled and people kept bringing us stuff – a homemade pastry from one house, cheese and crackers from another. One woman ran into her house and brought us warm bottles of Coke even as she apologized that she didn’t have any ice at the moment. The smiles and warmth of those villagers was unforgettable.
Between these two experiences, I gained important experiential learning of what I had already understood theoretically – Money doesn’t automatically buy happiness. Stuff like nice houses and cars don’t bring lasting joy.
A Happiness Edge?
I’ve had a long-standing project that I’ve been working on that ties in some great research on happiness to the field of trading and investing. Today, I’ll share a bit of those findings with you. Van has always been a proponent of trading while in the proper mental state. My experience and analysis certainly confirms his thoughts and builds on that excellent foundation.
I suspect that many readers trade and invest in part because you experience some happiness from certain aspects of the trading/investing process. I also suspect that most of you could get even more happiness OUT of trading if you put more happiness INTO trading. Imagine using happiness as one of your trading edges. How? I’ll explain that later in the article.
First though, I wanted to share some broader research about happiness with you. Don’t worry – this isn’t fluffy stuff about rainbows and unicorns. This is real science being done through controlled studies that proves you and I can control a large part of our own happiness.
Happiness – Science & Research
About ten years ago, Sonja Lyubomirsky wrote an excellent book called The How of Happiness. I’ve shared some thoughts with you on that in previous articles but let me quote some thoughts on the book by Harvard Professor of Psychology Daniel Gilbert:
“Everyone has an opinion about happiness, and unfortunately, many of them write books. Finally, we have a self-help book from a reputable scientist whose advice is based on the best experimental data. Charlatans, pundits, and new-age gurus should be worried and the rest of us should be grateful. THE HOW OF HAPPINESS is smart, fun, and interesting—and unlike almost every other book on the same shelf, it also happens to be true.”
Ah, some good science about a traditionally “soft” subject! The book is deep and broad in its exploration of happiness and how to get more of it. Let’s look at some of Dr. Lyubomirsky’s main points and see if they would apply to the disruptive time that we’re living in and to the world of trading and investing.
Early thinking in the field suggested that happiness was largely a function of our genes – you’re either born happy or you’re not. Lyubomirsky found, however, that personal happiness is not genetic but rather is largely in our control. Research using identical and fraternal twins shows that only about 50% of our happiness is from a genetic predisposition. The studies show that we all have a happiness set point, much like the set point for our body weight. Some people are inclined to having a leaner body and some are inclined to have a happier disposition.
More surprising to me was that only 10% of our individual happiness comes from circumstances (as my trips to Beverly Hills and St. Maarten anecdotally validated). So a genetic component of 50% and a circumstantial component of 10% leaves a full 40% of our day-to-day happiness coming directly from our intentional thoughts and activities. That’s actually a lot to work with! The 40% finding was so important that Dr. Lyubomirsky initially was going to call her book “The 40% Solution”.
So the key to happiness is focusing on the 40% that we can control.
Happiness, the Pandemic, and Joy
This pandemic has been an unprecedented disruption to “normal” life. Most people in most countries around the globe are living through changes large and small. From employment loss to restrictions on where you can go and what you can do all the way down to entertainment options at home – we’re living through a unique period. Like my Beverly Hills experience, I have witnessed people grouse and complain about the slow internet, being unable to go to their favorite restaurant, and many other inconveniences.
Dr. Lyubomirsky’s work reminds us that only a very small part of our happiness today is about our circumstances. A four times larger portion of our happiness comes from what we do and how we respond to outside influences. Some people seem to get her point. Many essential workers have carried on treating illness, keeping the lights on, and keeping the grocery store shelves stocked – all with grace and empathy. I have also seen others move through this time spreading happiness where ever they go. We all can learn by their examples.
I hope and pray that we have left the pandemic’s worst parts behind us. If so, we still have a long road back toward normalcy. While we pass through this “in-between” phase, consider doing things for yourself and others and that will increase happiness. This smallest acts of kindness and consideration can make a huge difference for yourself and for others. Here are some acts to consider:
- Reach out to someone you haven’t heard from lately. A text, email, phone call, or video chat can brighten your day and theirs. The power of staying connected is wonderful.
- Do something kind for yourself. Play a favorite song you haven’t heard for a while. Watch a movie you love – again. Take a nice long bath instead of a shower. Set aside some extra time to meditate or pray.
- If you are able, find someone to help. Think of all the people affected by business shutdowns. Your favorite waiter or barkeep. The person who does your hair, leads your yoga class or grooms your dog. You get the idea. Send them a note. If you are still fortunate enough to have income coming in, give them a monetary gift – even a little can help someone who hasn’t been able to earn their normal income.
What are your favorite ways to lift someone’s spirits?
I’ve reached out to people with a kind thought or a small gift and heard that it lifted their spirits at just the right time. Doing those types of things revitalizes my spiritual side and I have heard the same from others. This moves these small gestures from the realm of happiness to joy…
Joy is a very close cousin to happiness – I like to think of joy as a continual state of being while happiness is more of a renewable temporary mental state. Joy for me seems to reside more in the heart and soul while happiness lives in the mind and body.
Happiness and Trading
Surprise – like almost every worthwhile endeavor, maintaining our happiness requires effort.
I see some great parallels between becoming a skilled trader and achieving a desired level of happiness. In both, so many people would like to have all of the benefits just fall into their lap. The Holy Grail system that makes me rich or the magic pill/advice/”secret” that makes me happy. In both arenas, there are also loads of people ready to provide “The Answer”, when in fact, the true answer is to find what works for you and be intentional about regular practice. One example is finding useful mental states for your trading. Van suggests various mental states in the Peak Performance Home Study course and my personal favorites are resourcefulness and relaxed alertness.
Another surprise – the same things that stress people out in life stress traders out as well. Here are a few examples:
- Trying to please everyone else or do what everyone else expects of us.
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- As Van has described so well, we can’t please all of our parts all of time. The part that wants excitement is usually in conflict with the part of us that wants security. In trading, following the crowd (doing what’s expected) usually leads to being the last one to jump on a trend (which usually happens just before the reversal…)
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- Trying to be perfect
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- This one is easy to see – I’ll say that I know many more people who are still waiting for “perfect” before they start trading – perfect plan, perfect time, perfect system, etc.
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- Trying to find happiness in stuff
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- Traders love stuff – systems, new indicators, entry tricks, all manners of shiny objects. This one is so prevalent, I’ve written whole articles about chasing shiny objects and the disappointment that follows.
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Finally, you have probably heard the old adage that scared money is dead money. Trading scared is one of the quickest ways to strip an account. You can combat fear with the Tharp Think Principles that Van teaches but I’ll add one more idea – add happiness or joy to the process of trading. Happiness and joy are the opposite of fear so set a goal to be happy and joyful in your trading process. (Note – I have also tried adding drudgery and striving to my trading for years. Save yourself. Those states never seemed to work and more often led to stress.)
Ending With Good News
Once again, I find myself really admiring researchers who give us applied psychology tools. Dr. Lyubomirsky has provided a good roadmap for the intentional things that we can do to increase our day-to-day levels of happiness, joy, and hope.
When health and finances are uncertain, hope sustains us to get through to the other side. I find lasting hope in my spiritual connection with God. You’ll likely find such a connection in your own spiritual tradition but we will also find it in our own acts of kindness or service and in acts we see by those all around us.
So take a break from negative news and spend some time each day searching out the stories where people are helping each other. You’ll be happy you did.
I’d love to hear your thoughts and feedback – just send an email to drbarton “at” vantharp.com.
Great trading, stay safe out there and God bless you,
D. R.
The Points are really good.