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What Is The "Right" Hard Work To Become A Good Trader

Uncategorized Dec 03, 2019

Everyone talks about how hard you need to work at becoming a good trader

It’s true 

But doing the right hard work vs just hard work is where most fail

The old saying “practice makes perfect” is usually improved by saying “perfect practice makes perfect”

When you repeat a task over and over you get more efficient and more effective at that task

 You could practice throwing a golf ball with the intention to get good at golf

But in the game of golf, throwing the ball is not allowed as a way to advance on the course

I use to think that making a trading plan the night before and sticking with that trading plan the next day was what working hard was all about

Then the market would have its say about my trading plan and I’d get so bothered because I made a plan and it didn’t work out

I’d get frustrated, I’d feel defeated, I’d want to give up trading

Then I’d motivate myself, get pumped up again and talk to a few fellow traders and go right back to creating another thorough trading plan for the next day

The problem is NOT that I had a trading plan

The problem was that it wasn’t a good plan

It looked great as I wrote it out, all my support and resistance levels, all the potential news and economic factors that could move the markets and all the different assets I was going to watch

But did any of that stuff matter?

In reality this was just me looking like a well prepared trader, so other traders would look at me and say “wow that Chris, he’s a really prepared and informed trader”

So I was achieving that

But what I really wanted was to be a consistently profitable trader

 Not on every trade, not every day, but over the course of a year I wanted to be profitable...consistently

I outworked everyone, I outread everyone, I knew every trader quote and folksy saying and could repeat them on demand 

I knew the closing price of every asset I traded, I knew every stupid detail that didn’t help me make money consistently

Finally after declaring trading bankruptcy...again

(that is, I shut my charts off, closed my account, turned off Bloomberg/CNBC, closed any window that had anything to do with trading and just walked away)

I turned on Friends or Two and a Half Men (I was living in South America at the time, so this was the only english speaking TV I had available) and just binge watched

Interestingly at this time I was also playing Blackjack every day

I learned how to count cards and I learned how to bet appropriately, I had a system that I played every day and it was successful

It wasn’t until that “trader bankruptcy” moment that I realized I needed to approach trading the same way I approached Blackjack

I needed to identify what the truly important factors were to trading and focus on those, also not pay any attention to what wasn’t relevant to trading success

I quickly realized that my success at Blackjack was not about being right or wrong on a hand but knowing when to bet big when I had a statistical advantage and when to undersize or walk away when I didn’t

This was what I focused on when and how much to bet, not what I thought about a particular asset

That’s it, that’s what started me on the path of systems trading

Over the years I developed a methodology to backtest my ideas and validate them

 This happened before the Global Financial Crisis in 2007/2008 when volatility and everything that had been working up until that point changed dramatically

It didn’t happen overnight, it took a lot of years to get really good at building and backtesting systems and learning about what is useful to focus on and what is a waste of time

The Systems Mastery Course goes over all of the important parts and show you how to build your own systems

The feeling of knowing that you built something and knowing that you understand the system you are trading is powerful

If you find the stuff I talk about useful and want to explore it further then I’d love nothing more than for you to go through the course and learn how to build your own systems

I’m always here on Twitter and Subscribe to my email, I go in much more depth there

 

 

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