One of my all-around favorite quotes on trading is actually about poker.
It comes from cash game pro Tommy Angelo, who says, “The best way to get better at poker is to get better at everything and let poker rise with the tide.”
An intimidating thought for some. To REALLY up your game (be it poker, trading, or something else entirely) you have to improve as a competitor. As a human. As a thinking, acting, decision-making machine.
For others, though, this thought is not intimidating but inspiring. “Raising the game,” i.e. getting better at everything, is part of the attraction in the first place.
To that end, trading is all about making decisions.
And making good decisions is not just an art, but a skill set — an area of focus where you can learn and practice and improve. (more…)
Archives of “competitor” tag
rssGoal Setting
Competitive goals can lead to burnout. Michael Jordan who is a compulsive competitor, exhausted himself in continually reinventing new ways to spark the fire in his enthusiasm.
Destination goals, such as, “I’ll get to this particular place by x date” tend to be difficult to maintain since the reward exist in the non-existent future.
Process goals, are increments of cumulative experiences that instantly offer rewards in the present of now. For example, when I first started day trading, I made no attempt to make a lot of money immediately. My immediate goal was to learn market dynamics without suffering major financial losses.
I convinced myself that once I learned how to not loose money, probability favors my chances of starting to make money!.
This approach allowed me to (1) maintain my self-confidence, (2) stay in the game without capital blow-out, (3) develop a non-emotional response to rapid fire decision making, (4) handle small draw down with minimum psychological upheaval, (5) visualize the feeling that I will be doing this for the next 50 years, and (6) secure the knowledge that my journey was a life long commitment to learning.
I believe it is good to set smaller challenges that generate rewards in the present and not in the non-existant future and let the long term goal of consistence of profit flow naturally from a great set of process actions, such as system design, indicator design, system testing, placement of trades, etc.
“It is the very foundation of strategy to be able to adapt to any situation and continue fighting without losing heart. You gain this ability by practicing day in and day out with intensity.”
–Miyamoto Musashi
The First Requirement for Success
“Sun Tzu said if you sit by the river long enough, you’ll see the bodies of your enemies float by. The key is “long enough.” If you live long enough, you have to be the survivor. When I was a kid, we didn’t have the video games you have today, so we used to listen to comedy records. One of the greatest ones was Mel Brooks doing the 2000 year old man. Carl Reiner says to him, “how did you get to be the world’s oldest man?” And he says, “Simple. Don’t die.” How do you get to be the world’s oldest investor? The answer is don’t crap out.
“So if you look at distressed debt where we started in 1988, I could tell you who our number one competitor was in every year through 1995 and not one is a main competitor today. And it’s not because of what we did; all we did is perform consistently. They crapped out. It sounds simplistic to say, but the first requirement for success is survival…”
– Howard Marks
What steps do you take to ensure survival as a trader? (more…)
Some Money Launderers are “More Equal” than Others
“All animals are equal, but some animals are more equal than others.”
– George Orwell’s Animal Farm
It’s been many, many years since I read George Orwell’s Animal Farm, but the message conveyed in it will remain with me forever. The book is many things, but more than anything else, it is a portrayal and critique of human nature and the political systems that we create. For those that need a refresher, or have not read the book, here’s the basic plot.
There’s a farm headed by a Mr. Jones, who drinks so much he becomes unable to take care of the farm and feed the animals. Over time, the animals (in particular the pigs), decide human beings are parasites and the pigs lead a revolt and run Mr. Jones off the property. They change the farm’s name from Manor Farm to Animal Farm and create a list of 7 commandments. They are:
- Whatever goes upon two legs is an enemy.
- Whatever goes upon four legs, or has wings, is a friend.
- No animal shall wear clothes.
- No animal shall sleep in a bed.
- No animal shall drink alcohol.
- No animal shall kill any other animal.
- All animals are equal. (more…)