The Social Media Trap: Comparing Your P&L to Strangers

You wake up, check your phone, and scroll through X. A trader you follow just posted a screenshot: +$47,000 in a single day trading 0DTE options. The replies flood in, fire emojis, congratulations, requests for the ticker symbol.

You look at your own account. You made $340 this week selling a covered call. Suddenly, that $340 feels like pocket change. It feels like failure.

This is the social media trap, and it's one of the most insidious threats to your trading psychology and, ultimately, your capital.

The Curated Highlight Reel

Here's what you need to understand: social media is a performance stage, not a confession booth.

That trader who posted the $47,000 gain? You didn't see the $63,000 they lost the month before. You didn't see the sleepless nights, the margin calls, or the positions they're currently underwater on. You saw one frame from a movie, and you're comparing it to your entire documentary.

This isn't cynicism, it's statistics. A 2019 study in the Journal of Behavioral Finance found that retail traders who engaged heavily with trading social media exhibited significantly higher portfolio turnover and lower risk-adjusted returns than those who didn't. The researchers concluded that social comparison was a primary driver of suboptimal decision-making.

The psychology here is straightforward but powerful. When you see someone else's outsized gain, your brain doesn't process it as an outlier on their personal distribution curve. Instead, it recalibrates your expectations. What was once a satisfactory outcome, that $340 covered call premium, now feels inadequate. You've just moved your goalposts without changing your strategy, capital base, or risk tolerance.

This is comparison bias, and it's expensive.

How Comparison Sabotages Your Trading

The damage unfolds in three predictable stages.

First, performance comparison distorts your perception of what's "normal." Options trading, when done properly, is about capturing small edges repeatedly over time. A 2% monthly return on capital compounded annually produces exceptional results. But when you're seeing accounts that allegedly doubled in a week, 2% monthly looks like treading water.

The truth? Those explosive returns almost always come with explosive risk. The position sizes are oversized. The strategies are speculative, not systematic. The time horizons are measured in hours, not months. But you don't see that context in a screenshot.

Second, unrealistic expectations lead directly to oversized positions. This is where the real damage happens.

Let's say you've been running a disciplined Wheel strategy, risking 5% of your portfolio per position. You're generating consistent premium, occasionally taking assignment, and compounding slowly. Then you see someone on X turning $10,000 into $30,000 in two weeks with directional plays.

The temptation isn't subtle. It's a voice in your head that says: "If I just sized up this one time, I could catch up." So you allocate 15% instead of 5%. You buy that weekly call instead of selling that monthly put. You convince yourself it's calculated, but what's really happening is that someone else's P&L has hijacked your risk management framework.

When that trade goes against you, and statistically, it probably will, you haven't just lost money. You've lost something more valuable: trust in your system. Now you're emotional. Now you're trying to "get back to even." Now you're trading on tilt.

Third, social media accelerates your internal time horizon in ways that conflict with sound options strategies. The most reliable approaches to options trading, PMCCs, the Wheel, systematic credit spreads, work precisely because they're built on the law of large numbers and time decay. They require dozens of trades over quarters and years to manifest their edge.

But social media operates on dopamine cycles. Every day brings new posts about new wins. The algorithm rewards recency and excitement. Before you know it, you're evaluating your monthly strategy on a daily basis, which is like judging a marathon runner's performance by their time at mile two.

The Illusion of the Level Playing Field

There's another layer to this trap that deserves attention: you're not trading on the same field as the accounts you're comparing yourself to.

Professional traders and large accounts have access to lower commissions, better fills, portfolio margin, and most importantly, different capital constraints. When someone with a $2 million account makes $47,000, that's a 2.35% return. When you make $340 on a $20,000 account, that's a 1.7% return. The percentages tell a completely different story than the absolute dollar figures, but our brains don't instinctively think in percentages.

There's also the selection bias problem. Thousands of traders are posting their wins. Almost none post their losses. You're watching a highlight reel from thousands of accounts and comparing it to the full unedited footage of your own trading. It's a rigged comparison from the start.

Consider this: the average annual return of the S&P 500 over the last fifty years is roughly 10%. Warren Buffett's Berkshire Hathaway averaged about 20% annually over several decades, making him one of the greatest investors in history. If you're generating 15 to 20% annually through systematic options strategies, you're outperforming the vast majority of professional money managers.

But that reality doesn't feel satisfying when someone on X just posted a 200% gain in a month.

Refocusing on What Actually Matters

The antidote to the social media trap isn't to delete your account or stop learning from other traders. It's to rebuild your mental framework around three foundational principles: your own time horizon, your position sizing discipline, and your personal definition of success.

Start with time horizon. Before you execute any trade, ask yourself: what's the intended duration of this position, and does it align with my strategy? If you're running a PMCC with a long-dated LEAP, your evaluation period should be quarterly, not daily. If you're selling weekly credit spreads, your evaluation period might be monthly, tracking your win rate and average profit per trade across dozens of occurrences.

The key insight here is that your time horizon determines your relevant comparison group. You shouldn't be comparing your monthly Wheel returns to someone's daily 0DTE results any more than a distance runner should compare their pace to a sprinter's.

Next, commit to a position sizing framework that's based on your capital, not your ambition. The most successful options traders I've encountered over 23 years all have one thing in common: they're ruthlessly consistent with position sizing. They don't "size up" when they're feeling confident or after they've seen someone else's big win. They deploy the same percentage of capital per trade, week after week, month after month.

Here's a practical framework: never risk more than 5% of your portfolio on any single position. For most options strategies, this means your margin requirement or capital deployed should be no more than 5% of your total account value. If you're trading iron condors and your account is $50,000, each position should require no more than $2,500 in buying power.

This sounds simple, but it's profound. When you stick to this discipline, no single trade can materially damage your capital base. You can be wrong ten times in a row, which shouldn't happen with a positive expectancy strategy, but it's theoretically possible, and you'd still have 50% of your capital intact to continue trading.

Compare that to what happens when you size up to 20% on a single position because you're trying to match someone else's returns. One bad trade and you're down 20%. Two bad trades and you're questioning whether you should be trading at all.

Finally, define success on your own terms, using your own metrics. This requires deliberately opting out of the social media comparison game.

Create a simple tracking spreadsheet. Record every trade: the strategy, the capital deployed, the result, and the return on capital. At the end of each month, calculate your total return and your win rate. Over time, you'll build a data set that tells you exactly what your trading actually produces, not what you wish it produced or what someone on X claims their trading produces.

This data becomes your anchor. When you see that $47,000 gain posted online, you'll have your own context. You'll know that your strategy has a 73% win rate and generates 1.8% monthly returns with low volatility. You'll understand that chasing someone else's highlight reel would require abandoning the approach that's actually working for you.

The Deeper Game

There's a more fundamental question worth asking: why are you trading options in the first place?

If the answer is to turn $10,000 into $100,000 in six months, you're playing a different game than I'm describing here. That's speculation, and there's nothing wrong with speculation if you're honest about it and willing to accept the corresponding risk of ruin.

But if the answer is to generate consistent income, compound capital over time, and create a systematic edge in the market, then you're playing the long game. And the long game requires patience, discipline, and a willingness to look "boring" compared to the social media highlight reel.

Consider this perspective: in 23 years of trading, I've seen markets crash, recover, and transform entirely. I've watched options move from fractional pricing on paper tickets to algorithmic microsecond execution. The traders who survived and thrived weren't the ones posting their biggest wins online. They were the ones who showed up every month, executed their process, managed their risk, and avoided the self-inflicted wounds that come from comparing themselves to other people's curated performances.

Your only meaningful comparison is to your past self. Are you trading more systematically than you were six months ago? Is your win rate improving? Are you sticking to your position sizing rules? Are you learning from your losses without letting them derail your strategy?

These are the questions that matter. The answers aren't as exciting as a five-figure daily gain, but they're what separate professionals from gamblers.

A Practical Suggestion

Here's something you can do right now: write down your monthly return target as a percentage. Not a dollar figure, a percentage. Make it realistic based on your strategy. For a systematic credit spread portfolio, maybe it's 2 to 3% monthly. For a PMCC strategy, maybe it's 3 to 5% monthly. For the Wheel, maybe it's 2 to 4% monthly.

Now compound that return annually in a spreadsheet. You'll probably be surprised at what consistent, "boring" returns actually produce over time.

Next time you see someone's outsized gain on social media, look at your percentage target. Ask yourself: if I hit my target this month, am I successful? If the answer is yes, then close the app and go execute your next trade according to your system.

Your P&L doesn't need to impress strangers on the internet. It needs to compound your capital and align with your goals. Everything else is noise.

The social media trap is just another form of risk, psychological risk. Manage it the same way you manage market risk: with discipline, data, and a clear-eyed understanding of what you're actually trying to accomplish.

Your $340 covered call premium might not get any likes on X or Facebook. But if it's part of a systematic approach that's working, it's worth more than any screenshot.

Probabilities over predictions,

Andy Crowder

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Disclaimer: This is educational content only. Not investment, tax, or legal advice. Options involve risk and aren't suitable for all investors. Examples are illustrative. Real results will vary. Talk to professionals before you risk real money.