“To know thyself is the beginning of wisdom.” – Socrates
Socrates, an ugly (in body, certainly not in mind) little philosopher born circa 470 BC, was said by the Oracle at Delphi to be the wisest man alive.
Socrates did not think he was wise at all, so he set about approaching those he considered the wisest men in Athens to see if what the oracle said was true. After questioning such luminaries, Socrates realized that while each man thought they were wise, they in fact knew very little.
Thus Socrates paradoxically concluded that he was the wisest because “he knows he knows nothing”.
(It was making those who considered themselves wise look foolish that ultimately undid Socrates, as he was sentenced to death by drinking a poisonous hemlock potion for “corrupting the minds of the youth”.)
Socrates was a man of conviction, who challenged conventional wisdom. He held no position of power, nor did he seek to. It was the humble acknowledgement of his own limitations that gave him his virtue.
Socrates’ influence came from knowing himself first. His was a journey of self-mastery and it was a deep-seated awareness of the limitations of the human condition that gave him his power.
Leadership starts with self-knowledge
For the leader Socrates serves as a prime example.
His quest began with a profound understanding of himself. He thought deeply, he fought bravely (he was a heavily armed Greek Hoplite soldier at one time), and he questioned the logic of the established authority.
Authentic leadership does not come from an external position or title, or from wealth and grand claims. The true leader needs to adopt this self-questioning nature and humbleness.
But don’t confuse being humble with being deferential. The authentic leader is able to find the peculiar balance between extreme confidence in their ability to generate the desired outcome, and the necessary lack of ego to truly see what is going on in front of them.
Leadership develops through self-work, self-examination, and long periods of introspection. Then it is refined through practicing the skills of the craft, learning to collaborate with other minds, and taking the hard knocks and lessons you get when you chase your vision.
We are all leaders
It may seem odd to some of you to discuss leadership in the field of trading. After all, how do you lead when you are engaged in what is seen as an isolated endeavour?
Firstly, trading is a business. To succeed, you need to put in place the systems and processes to run the business, and develop the mental skills to manage yourself – i.e. you need to learn to lead yourself.
Secondly, the exact same traits that apply to trading apply to leadership. Consider that confidence, motivation, discipline, humbleness, ego regulation, superior emotional intelligence, and the ability to face reality with a positive expectation are essential in both fields. .
Thirdly, we are not really isolated. Our trading provides a grand opportunity to create change, both in our personal lives and in the lives of others whom we choose to help. Mastering the abilities required for both effective trading and leadership gives us the skills to overcome any challenge we face.
For many traders this can include the ability to be a better leader in the workplace and in the family unit. Trading is the ideal vehicle to transform yourself into the kind of leader you want to be.
The first phase of trading
The first phase (which, by the way, can go on for a long time!) of trading is about personal growth. We start out green and learn both the emotional skills of trading and the technique.
Once you have developed the requisite self-knowledge, you won’t tolerate negativity, poor behaviour or dishonestly in your life. If you do, it will be reflected in your trading with an eventual comeuppance.
The markets have little tolerance for ego and stubbornness. The best leaders have even less, especially when it comes to their own thoughts and feelings.
Expanding your sphere of influence
In his classic work The Seven Habits of Highly Effective People, Stephen Covey discusses the circle of concern and the circle of influence.
Put roughly, the circle of influence is the area that you can currently affect; the circle of concern is the area you would like to affect.
As an example, I’m sure you can identify the areas in your occupation that you directly influence, and the things outside of your control. Often, we spend a lot of time in our jobs agonizing over (and getting frustrated by) those things that we can’t control.
But if you develop your skills as a personal leader, you can start to expand your sphere of influence.
Leadership is realising what you can change and what you can’t, rather than complaining about things outside your control. Leadership is listening to others first, rather than just waiting for your turn to be heard. It’s when you practice the tasks of authentic leadership with commitment and positivity that a leader grows in authority. It’s when you lead by example that others start to follow.
By developing your skills as an authentic leader though the vehicle of Forex trading, you acquire an extreme amount of discipline and high personal standards. You become someone that people want to follow, and you will be in the best possible position to grow your circle of influence, whether this is in the sphere of trading, or in your personal of business life.
Like Socrates, we agitate others to be better. Be it better traders or people.
Over to you
The art of personal leadership is essential for the trader.
If you can’t lead yourself, you won’t have the emotional skills to develop mastery in this complex and uncertain game.
But by gaining authentic leadership skills, you can set yourself up to succeed in the markets, as well as live a life of much greater influence and meaning.
Knowing thyself is the key. Can you unlock it?
About the Author
Sam Eder is a currency trader and author of the Definitive Guide to Developing a Winning Forex Trading System and the Advanced Forex Course for Smart Traders (get free access). He is the owner of www.fxrenew.com a provider of Forex signals from ex-bank and hedge fund traders (get a free trial). If you like Sam’s writing you can subscribe to his newsletter.