All of us have wins and losses, but its important when we experience the latter that we do something very deliberate, and very necessary.

Like submarine commanders that have flooding in one compartment, we have to seal it off quickly and without sentimentality.

Otherwise, the entire vessel might be threatened.

The same thinking should inform our reactions to setbacks of any kind.

If were a student, for example, we need to tell ourselves:

(1) This is only one paper on which I received a low grade;

(2) Even if this torpedoes my final grade, its only in one class;

(3) At worst, I may decide to repeat the class, and Ill do better; and

(4) Even if I get a bad grade in the class, my overall grade point average will be fine.

You could use the same thinking with a stock you bought that has suddenly tanked.

Its only one stock, and you can always save up and buy it back at a lower level if you believe it will rebound. If you have to take a small loss, you can make it up on other stocks, and even if you dont, and you accept the loss, you wont starve.

This is known as bracketing or partitioning, and its essential to maintaining a positive attitude, especially when youre experiencing a setback.

Next time youre feeling low, and especially when youre over-generalizing about failure, allowing it to infect your entire consciousness, use partitioning, and youll limit the damage, and speed up your recovery.