The path to Success in trading is similar to success in any other field. Whether it is boxing, bodybuilding, mathematics or even playing chess. It requires many qualities like discipline, consistency hard work and many other things. The whole point of this article is to let traders who start off in this business knows what it takes to be a good trader.
Lets take a simple case of wanting to be a good chess player. If I wanted to be a good chess player I would do these things. Firstly everyday I would give about 6 hours just focusing on researching chess, playing chess and many other chess related stuff like reading chess books for instance. By the end of the year assuming 65 days off you have 300 days, which sums up to 1800 hours. So next year, around this time I’m not an amateur chess player anymore, I am a chess player with 1800 man-hours of chess in me. I could probably compete in multiple tournaments and probably even win. Lets continue it for another 2 more years. Now I have a total 5400 hours. Now I can probably win national or even an international competition. Imagine the experience I get participating in these competitions on top of all these hours of work. This philosophy is all it takes to be great in anything. CONSISTENCY. If you do something over and over again you are bound to succeed.
I was extremely skinny as a kid. I was the skinniest boy in my class. But when I turned 18 I slowly started going to the gym. It’s been 10 years on or off. The past 6 years I have be able to be super consistent. By consistent I mean 5 to 6 days a week. 1 hour per day. I’m not that strict with the diet and I’ve been lazy every now and then but even then I can see results. Every year I can see improvements in my body. The reaction’s from people when they look at me is literally priceless. But I wasn’t born that way. It’s just that I was consistent in hitting the gym.
One of my favorite books is “Outliers” written by Malcolm Gladwell. This article is inspired from his theory that it takes around 10’000 hours to achieve mastery in any field. From my personal experience you don’t need 10’000 hours. By the time you reach 3000 hours itself you would have learned and improved substantially.
I was once in a social event where I met somebody and he asked me what I did. I told him I was a trader and traded equity index, bonds and commodity futures. He told me he tried trading but it didn’t work out. I asked him a simple question “How long did you try it for?” His answer was “One Month”. To which I responded, “That’s exactly why it didn’t work out”. Obviously he took it in a negative perspective or at least his facial expression seemed to imply that. The thing is just like anything trading is a skill that has to be mastered. You need to accumulate the hours to be good at it. You need to learn. Imagine if he had done it for 3 years. Imagine if he just stared at the screen from the time the market opened to the time the market closed. The amount of information he would have gained itself would have given him an edge. His answer of “One month” is a major problem many youth face these days. They want instant gratification. They want a great body but can’t put in years of work. They want to make money by being a great in their craft but cant put in the hours.
Trading is a competition between you and rest of the traders. The derivatives market is a zero sum game. For every winner or amount won there is an equivalent loser and amount lost. It’s exactly similar to poker. So when you’re new to trading you’re competing with the rest of the traders. Some of them are so good that they have accumulated hours of experience, education and research. The past 5 years alone I have experienced Greek Crisis, Brexit, Swiss National bank decision to abandon the cap against the Euro, Chinese stock market crash (Black Monday), Trump election shock victory and many many other instances. Imagine the experience that I have facing all these trading scenarios. In order for you to succeed you have beat people like me. You need to accumulate these trading hours if you need to get an edge. In the trading community it might also be called “screen time”. Get that experience.
To conclude, I can’t make you a great trader. But you can. Put in the hours and in a few years you will succeed and you will see it for yourself in your bank statements.