The Worst Defense is the "Prevent Defense"

I got a lot of feedback from yesterday's note, where I urged you to stop trading if you're feeling the pains that only surface when you're trading with money you can't afford to lose.

It appears to have resonated with many of you. And for good reason. I think we can all relate from time to time.

Let's expand on this idea.

I'm going through an intense phase of my life where I'm finally learning about myself. About the way I think. Why I react to certain stimuli the way I do. Where my feelings about love, success, money, relationships, work, and more come from.

One of the big "Aha!" moments for me recently is the realization that I've spent the better part of my life trying NOT to be something or someone, versus just being me. In other words, I've exhausted so much energy focusing on avoiding what I perceive as negative, versus investing my time and energy into being the best version of myself.

For me in trading, this manifests as putting inordinate amounts of effort into risk management. Because I did not want to lose money. I did not want to fail. I did not want to be part of the statistics of 90% of traders who don't make it. I didn't want to be the laughingstock because of poor trading decisions.

My energy was focused on all the things I did NOT want to be.

That didn't leave much energy left over to visualize what I DID want to happen and position for success.

Do you notice the subtle but powerful difference?

Can you see how this "trying not to be something" is a version of trading with money you can't afford to lose? You're trying so hard not to be a loser—because you cannot afford to be—that you inevitably hold the door open for losing to walk right into your home and make itself comfortable on your couch.

Winning isn't easy. But how can we win if all we're focused on is not losing?

Any NFL football fan can tell you the worst defense is the "prevent defense." While attempting to prevent a score, too often it just invites the opposing team to move the ball down the field, gaining momentum that eventually cannot be stopped.

Trying NOT to be something might be the worst thing we can do to prevent bad outcomes. If instead we take smart risks—not oblivious to but mindful of the potential drawbacks—and keep our attention on winning and what that looks like, we're more likely to manifest favorable outcomes.

This doesn't mean being reckless. It doesn't mean ignoring risk management. But there's a world of difference between managing risk as part of a winning strategy versus obsessing over risk because you're terrified of losing.

One is proactive. The other is reactive.

One comes from strength. The other from fear.

When you're playing not to lose, you make conservative decisions that feel safe but limit your upside. You cut winners too early because you're afraid they'll turn into losers. You avoid high-conviction trades because the potential loss looms larger than the potential gain.

You're in survival mode, not winning mode.

But when you're playing to win—when you're trading with money you can truly afford to lose and your energy is focused on executing your best game—everything shifts. You take calculated risks. You let winners run. You trust your process because you're not constantly second-guessing every decision through the lens of fear.

The irony is that trying not to lose often leads to exactly that outcome. While positioning to win—with proper risk management as your foundation, not your prison—creates the conditions for success.

I'm still working through this myself. Years of conditioning don't disappear overnight. But recognizing the pattern is the first step.

Are you trading to win, or are you trading not to lose?

The difference isn't semantic. It's everything.

Sean McLaughlin | Chief Options Strategist, All Star Charts