August 26, 2006
FAILURE TO KEEP STUDYING, LEARNING AND GROWING
The illiterate of the future will not be the person who cannot read. It will be the person who does not know how to learn...Alvin Toffler ( Future Shock)
This blunder is one of my favorites because it embodies the idea of continual enrichment of self as critical to success as a trader or investor. It is a recurring and powerful theme in my monthly Trading Wisdom Newsletter, and this is just a snippet.
As a Medical Doctor, I went through this training post high school: four years of college, four years of medical school, one year of internship, two years of residency in anesthesiology, one year of fellowship in cancer pain management, three years of residency in psychiatry. That is a total of 15 years, and about right for most medical specialists and subspecialists ( some do less and some do more). At the end of this period, I started to practice medicine. Practice is the key word here. Several year later, I sat for two separate National Board Examinations and- -you guessed it--I was still practicing. Additionally, medical regulatory agencies require that doctors take a certain number of continuing education courses every year in order to maintain their licenses. So, doctors, no matter how many years away from medical graduation are still practicing ( which means practical clinical learning) and taking seminars and classes (book learning). Physicians and other licensed professionals must make a commitment to life long learning in order to simply keep practicing. When do you stop practicing? When you leave the profession and not one minute sooner.
This is the plan and mindset that a successful trader and investor must adopt. The process is different from that of becoming a doctor or lawyer because, although there are certain rules of trading and several different certifications required for brokers or broker dealers , there are no regulatory agencies which license the majority of traders. In fact, many reading this may not have even thought about getting licensed or certified. Anyone, anywhere, any age or background can put money into a brokerage account, enter the markets and trade. It is this democratization which gives a kind of "wild west" atmosphere to certain activities in the markets. However, in order to be successful and maintain longevity as a trader, it is necessary to read, study, learn and keep reading, studying and learning until the day you stop trading. Being a self-directed trader or investor affords one great freedom, but comes with a price. That price is the commitment to never ever stop learning and practicing.
Read everything and anything. Buy books and read them. Buy books and don't read them, but use them for reference. Attend seminars, talk with other traders and investors, attend book chat, form small groups to discuss technique, approaches, methodologies, philosophies and psychologies, join an online trading room where you have a genius like John Lansing, founder of www.trending123.com guide you and teach you all day every day and share with you his experiences, challenges, victories and frustrations in real market time. Learn from the winners and the losers, ask questions, remain continually curious and fascinated with childlike wonder at the mystery and majesty of the markets.
Above all, learn from your own mistakes and your own victories. Learn what works for you and what doesn't work for you and come to see how your biggest mistakes are your greatest teachers. Keep studying, day after day, and set aside at least two hours a day just for research and study. Learn the language of the markets you trade, how they work and what actually happens when you place orders. Become increasingly sophisticated with your knowledge of markets from a structural point of view, then begin to explore indicators, instruments, platforms, systems, macro, micro and self psychology, fundamentals, cycles, sectors, and anything and everything that you can find. The more you learn, the more you will learn how little you know and the more you will be inspired to keep studying. The more you learn, the more your brain will begin to filter out what is signal and what is noise for you. This is a highly personal activity that is unique to your particular brain structure. Use it, capitalize on it, get comfortable with it until you feel and know what works for you, and you get into a kind of effortless flow. That is what passion, commitment and drive are all about and you need all three to succeed and thrive as a trader
Only the curious will learn and only the resolute overcome the obstacles to learning. The quest quotient has always excited me more than the intelligence quotient...Eugene S. Wilson
Disclaimer - I am not a commodity trading advisor. The information on this site is for trading education only. There are no trading recommendations for any one individual made on this site and this information is paper trades for trading education. All trades are extemely risky and only risk capital should be used when trading.
U.S. Government Required Disclaimer - Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to Buy/Sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results.
CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.