The Roman philosopher Seneca wasn’t talking about the stock market when he wrote that “T...
How to Become a Super Trader
12/23/2014 6:00 am EST
John Locke of SMB Training Blog uses the analogy of learning how to type to illustrate how, when it comes to successful trading, it all comes back to mastering the basics and having the proper trading psychology and frame of mind.
Being successful at trading is really quite simple. Follow a certain set of principles over an extended period of time and eventually you’ll produce great results. Unfortunately, learning, and more importantly, applying those concepts can be quite challenging. This is especially true when the process is approached with the wrong psychology. And if you think about it, isn’t it the same way with just about anything we learn?
For example, one of the things I’m learning to do right now is typing, a skill most of you probably take for granted. Now before you laugh, realize that I went to trade school and then directly out into the workforce as an auto mechanic. There was no need for me to learn how to type.
Later in life, when computers came along I used the one finger ‘hunt and peck’ method, which worked great at the time. Once I transitioned into being an educator, however, the demands on my typing increased a lot. The old hunt and peck method was seriously affecting my productivity and I decided it would be beneficial to use all my fingers so I could type more than 10 words a minute. How hard could it be?
So I buy this course on how I’m ‘supposed’ to type. Looks easy enough, so the next time I need to write, I sit down, put my fingers in the right place and…things didn’t go as planned. The course stunk.
Went back to two fingers, looked for a better course. Bought another course, it said the same thing. And what’s this? I have to practice? I don’t have that kind of time. Okay, fine, I practiced, which didn’t go particularly well. I must be doing something wrong. No, couldn’t be me, I need another course.
So I bought another course, a big one this time. This is going to be great. What? There are tons of practice lessons. Fine, apparently I’m going to have to practice.
Lesson 1: f, j, f, j, f, j, f, j, push two letters forever; I’m not going to waste my time doing this. I’m going to jump forward to the advanced stuff. And I bet you know how that worked out, something like 3 wpm and 100 errors.
Typing is so simple; just press the proper key with the proper finger at the proper time. Heck, I already know where the keys are. I’ve been pushing them for years. Why am I having so much trouble?
Is it that typing is complex? No, most people I know, including my wife and daughters, type quite well.
Is it that I needed to read more about typing? No, I knew more than I needed to.
Did I have something wrong with my fingers or nervous system? Is the keyboard defective? Nope, everything works great.
NEXT PAGE: So What Am I Missing?|pagebreak|
Am I a slow learner? Absolutely not.
I have the knowledge. I have the equipment .I have the capability. So why can’t I type well?
The answer is simple. I didn’t have the proper psychology. I had the false expectation that just because something is simple and other people are doing it that I should be able to pay some money or take a course and type like a professional without putting in the time and practicing the basics for an extended period of time.
I thought I could pay for information and then jump to an advanced level without mastering the basics. I was wrong. All I found was a recipe for frustration and failure.
So what does this have to do with trading? Everything.
I see it every day. Traders buy some course and start trading without sufficient practice or mastery of the basics. They look for the most advanced systems and the highest returns. “Forget the basics, I want to spend a few thousand dollars and go from zero to hero in a year”…or even less. When they inevitably run into roadblocks or things don’t work out they blame the material, or the market, or fear. They look for other courses and more information as if they’re going to come across some magic pill that’s going to make them super trader.
It’s not that they’re not trying. In fact, many of the traders I talk to are trying too hard.
Unfortunately, they’re trying too hard on the wrong things. They’re trying to shoot a 3-pointer in an intense basketball game when they’ve never made a foul shot. It’s a method that doesn’t work.
Just like me and my typing, you probably already know more than enough to become a successful trader. It’s time to forget about the magic pill and start mastering the basics. Then once the basics are engrained in your soul, introduce new concepts one at a time until you become super trader. It really is the fastest way, as well as the only way to get the long-term success you desire.
By John Locke, Contributor, SMB Training Blog
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