Taking profits step by step: Strengthening both the wallet and the mind

In the final part of our article series, I will discuss the importance of improving the process and learning from the experiences encountered throughout the process, rather than focusing solely on results, as well as the contributions of gradually taking profits to psychology, risk management, well-being, and individual economies. In addition to all this, I will address the reflections of the awareness gained throughout the process.

You should be process-oriented, not result-oriented: As long as you focus on the results, you will not be happy whether you win or lose, and there is no way to prevent this; you need to accept it and continue on your way. To illustrate with a simple example, if you are negatively affected and feel sad when your position is at a stop, liquidated, or at a loss; even if you close the position in profit, you will still feel upset when it moves. Therefore, we should structure our perspective around improving the process and growing our capital in a broader context. This way, even if you face losses in the short term, you can internalize the idea that your capital will continue to grow by staying true to your system in the long term.

Do not take action in real life as long as the profit has not reached your hands.

You should not increase your real-life expenses as long as you do not realize the profit from your wallet: There is a cliché that everyone new to the markets hears, but it is also a very true saying: "Any profit you do not realize is not yours." I want to evaluate this saying from a few dimensions. Firstly, many people tend to wait for even more when they see high profits from the products they have purchased instead of selling them. At this point, we must accept that there is no limit to the rises and that we will never be truly happy. In other words, whether you sell or continue to hold, the question "What if?" will linger in your mind. In my opinion, the best strategy at this point is to realize profits gradually. This way, even if you have sold the majority of your holdings, you still have assets that you can sell if the price rises; if it falls, you do not have to watch your profits erode since you have already sold the majority of your holdings.

Secondly, as long as we do not realize profits and do not withdraw our money to the bank, we should not increase our daily expenses. For example, when I first encountered crypto, I increased my spending thinking that I was already making money from the spot trades I had made, and I started buying unnecessary things like clothes. However, I had not made any sales; I was only holding my positions profitably. Later, the market started to decline, and I lost my profits in many trades while also spending money that was not mine, which set back my individual economy.

Are we being replaced by ‘fool’?

Finally, when the highly profitable trades we are in fall back to cost points or begin to drop, we feel like we have been placed in a "foolish" position. At this point, individuals may fall into cognitive dissonance and engage in actions they would not normally take. Cognitive dissonance is, in short, the inconsistency between a person's thoughts, beliefs, and behaviors. If we examine a person who has been holding profitable trades for a long time and then returns to cost from this theoretical perspective, we see that they believe they are right, they can take the trade, and they experience a sense of gain, yet despite all this, they do not encounter any output. This situation creates a contradiction in the individual, leading to tension. Subsequently, it causes them to seek new ways to reduce this tension. The three most reasonable paths are either for the person to accept they were wrong ( which would put them in a "foolish" position, thus reducing their well-being ) or to find external attributions such as ("they manipulated it down temporarily" ) and not take responsibility for the situation ( thereby preserving their well-being and self-confidence ) or to take unnecessary risks in an attempt to compensate for their current situation, trying to bring their balance back to the profitable state. Even if there is no financial loss in the first two paths, in the third scenario, a lot of money can be lost due to unnecessary risks taken. Therefore, if you want to avoid impulsive behavior, refrain from taking unnecessary risks, and maintain your self-confidence and well-being, you can enjoy your position by gradually realizing profits.

Don’t underestimate the importance of psychology and awareness: Especially recently, I have started to notice the dismissive attitudes of some individuals who have "started to gain a bit of fame" towards the psychological aspects of the work. I believe that the attitudes regarding this issue stem from prejudices against the science of psychology and the reduction of psychology to merely "therapy." Researching the psychological background of trade processes and markets, reading about it, and gaining individual awareness will not only help you carry out your operations better but will also enable you to lead a healthier personal life.

Information will not take action as long as...

When it comes to psychology, people generally tend to say, "I already know this / I knew this." However, it can be said that knowing or being aware is not enough on its own; it has no meaning unless it is demonstrated in action. Sometimes you read a sentence and all the statements you already know start to gain meaning and turn into action. Therefore, I suggest that you follow the readings, podcasts, or videos you consume with the mentality of "What did I learn from this?", "What does this mean in my life?"

Lastly, just as having good technical and fundamental analysis knowledge does not guarantee that we will profit from trades every time, having a solid psychological background and awareness does not mean that we will continuously take profits. As an individual opinion, I believe that these two processes are interconnected. Therefore, in terms of a long-term plan, we should not only nourish ourselves in the context of technical and fundamental analysis but also in areas such as psychological background and behavioral finance.

This article does not contain investment advice or recommendations. Every investment and trading movement carries risks, and readers should conduct their own research when making decisions.