Why do so few succeed?

[SOCRATES]

A trading friend sent this to me some time ago and may be of relevance to this thread.
I believe it's written by the 'Anonymous Trader'.

1.

We accumulate information--buying books, going to seminars and researching.

2.


We begin to trade with our 'new' knowledge.

3.


We consistently 'donate' and then realize we may need more knowledge or information.

4.


We accumulate more information.

5.


We switch the commodities we are currently following.

6.


We go back into the market and trade with our 'updated' knowledge.


7.


We get 'beat up' again and begin to lose some of our confidence. Fear starts setting in.

8.

We start to listen to 'outside news' & other traders.

9.

We go back into the market and continue to donate.

10.

We switch commodities again.

11.

We search for more information.

12.

We go back into the market and continue to donate.

13.

We get 'overconfident' & market humbles us.

14.

We start to understand that trading success fully is going to take more time and more knowledge then we anticipated.

Most People Will Give up at this Point as
they Realize Work is Involved

15.

We get serious and start concentrating on learning a 'real' methodology.

16.

We trade our methodology with some success, but realize that something is missing.

17.

We begin to understand the need for having rules to apply our methodology.

18.

We take a sabbatical from trading to develop and research our trading rules.

19.

We start trading again, this time with rules and find some success, but overall we still hesitate when it comes time to execute. We start trading again, this time with rules and find some success, but overall we still hesitate when it comes time to execute.

20.

We add, subtract and modify rules as we see a need to be more proficient with our rules.

21.

We go back into the market and continue to donate.We go back into the market and continue to donate.

22.

We start to take responsibility for our trading results as we understand that our success is in us, not the methodology.

23.

We continue to trade and become more proficient with our methodology and our rules.

24.

As we trade we still have a tendency to violate our rips and our results are still erratic.

25.

We know we are close.

26.

We go back and research our rules.

27.

We build the confidence in our rules and go back into the market and trade.

28.

Our trading results are getting better, but we are still hesitating in executing our rules.

29.

We now see the importance of following our rules as we see the results of our trades when we don't follow them.

30.

We begin to see that our lack of success is within us (a lack of discipline in following the rules because of some kind of fear) and we begin to work on knowing ourselves better.

31.

We continue to trade and the market teaches us more and more about ourselves.

32.

We master our methodology and trading rules.

33.

We begin to consistently make money. We begin to consistently make money.

34.

We get a little overconfident and the market humbles us.

35.

We continue to learn our lessons.

36.

We stop thinking and allow our rules to trade for us (trading becomes boring, but successful) and our trading account continues to grow as we increase our contract size.

37.

We are making more money then we ever dreamed to be possible.

38.

We go on with our lives and accomplish many of the goals we had always dreamed of.

This is constructive, and a very good start on the right road, the road to Ability, that is.

 

[fxmarkets]

Hmmm, well what socrates is saying in post 203 makes sense to me.. you have to be open change yourself/views,behaviour etc and not as humans will naturally want to do, force to change "externals" .

Discipline ie Training expected to produce a specific character or pattern of behavior. Discipline right?

Now as an exercise of demonstration of ability to actually do this ,first evidence of this will likely show up in a persons conduct even with posting on public Boards, how they conduct themselves. Little digs, personalising etc. This needs to cease This ,in the interest of anyone wanting to advance , Even further than they are ... whatever the stage, doing this will lead to further improvements, control of conduct, if you like. Important skill or way to be?


Now when people are using boards as windups, then thats too bad, whats the point? again you are not saying anything about the person/s you target , yet simply defining your current self with such comments. Control of conduct again maybe.

You will need to (well you dont need to but potentially it will pay off for you) position yourself neutral with feelings, even at discussion stage , training yourself to "behave" that may well lead to evolution of self ,leading to neutral aware control of conduct. (your open, to your current views, yet allowing potential new information to be examined)

Will this aid a persons ability? When you advance ability you obtain merit for having done so... theres a cycle of 3 at work here...


A point which is often raised... can a person trade....... forget it, if we lie who are we deceiving? its not the masses, its ourselves, thats what counts. Always live to your own values, if you want to lie etc, then do it... agressive? be it..... edit. but deception etc, will likely hold yourself back

So i see the

Conduct, Ability, merit.

makes sense., Forget or detach from personalities , read what is written, address/tackle those issues not the person.

Cheers All.

Fx.

Perhaps, maybe and what if, all the above.

 

[SOCRATES]

Hmmm, well what socrates is saying in post 203 makes sense to me.. you have to be open change yourself/views,behaviour etc and not as humans will naturally want to do, force to change "externals" .

Discipline ie Training expected to produce a specific character or pattern of behavior. Discipline right?

Now as an exercise of demonstration of ability to actually do this ,first evidence of this will likely show up in a persons conduct even with posting on public Boards, how they conduct themselves. Little digs, personalising etc. This needs to cease This ,in the interest of anyone wanting to advance , Even further than they are ... whatever the stage, doing this will lead to further improvements, control of conduct, if you like. Important skill or way to be?


Now when people are using boards as windups, then thats too bad, whats the point? again you are not saying anything about the person/s you target , yet simply defining your current self with such comments. Control of conduct again maybe.

You will need to (well you dont need to but potentially it will pay off for you) position yourself neutral with feelings, even at discussion stage , training yourself to "behave" that may well lead to evolution of self ,leading to neutral aware control of conduct. (your open, to your current views, yet allowing potential new information to be examined)

Will this aid a persons ability? When you advance ability you obtain merit for having done so... theres a cycle of 3 at work here...


A point which is often raised... can a person trade....... forget it, if we lie who are we deceiving? its not the masses, its ourselves, thats what counts. Always live to your own values, if you want to lie etc, then do it... agressive? be it..... edit. but deception etc, will likely hold yourself back

So i see the

Conduct, Ability, merit.

makes sense., Forget or detach from personalities , read what is written, address/tackle those issues not the person.

Cheers All.

Fx.

Perhaps, maybe and what if, all the above.

Actually that is a very interesting observation I had not previously deeply considered ~ the idea of these three necessary faculties engaging each other in this way, like wheels that gear with one another directly. But there is correlation in that, yes, one faculty does have the potential to enrich and enhance the other indirectly.

I have alway viewed them as three pillars supporting the roof of endeavour, and as confluent, but static, not moving. This is because each one is extremely important . The roof collapses if the three are not stong enough to underpin it.

You cannot arrive at these abstract conclusions until you have practical experience. The greater and longer the experience you have the greater the potential for a greater construct., meaning a greater overall understanding. All these things are relative, because they are experiential, and therefore exclusively personal.

 

[fxmarkets]

well yes, I mean conduct how we conduct our very being literally acting as conductors of information.experience, this state or level of conduct must or can ,potentially enable us to position ourselves favourably or not... to be open to be able to receive whatever it is we wish to access.. ?

 

[SOCRATES]

well yes, I mean conduct how we conduct our very being literally acting as conductors of information.experience, this state or level of conduct must or can ,potentially enable us to position ourselves favourably or not... to be open to be able to receive whatever it is we wish to access.. ?

Yes agreed, hence all experiences are formative.

 

[charliechan]

i must say in my attempt to get people to focus on what winning traders do rather than avoiding what losers do, people may want to take a look at the posts made by victor niederhoffer (well known fund manager and george soros protege) under the name profturf, and also the legendary don bright (under the name don bright) over on et.

niederhoffer, in his few posts, always emphasised the need to be courteous when addressing those who are knowledge rich, but time poor. i should point out, that niederhoffer was always in a positive mindset to state genuine helpful advise and findings that people could tangibly incorporate into their strategies if they so wished - and thought about what was being mentioned. topics discussed were very much tangible rather than mystery. whether one agreed with his approach is another matter, but i imagine he has made (and lost) more money than most of us! here was a real 'wizard' giving away a few ingredients out of his 'magic book'.

the same could be said of don bright as well to a lesser extent. a proven trader giving genuine useful help and advise (although knowing don, i would have thought he would be way too humble (as most good traders are) to be thought of with the likes of victor).

im just thinking of this attitude, merit and conduct thing, and something doesnt seem to be sitting right somewhere, especially when i think of those proven traders and their attitude, merit and conduct!

 

[dbphoenix]

i must say in my attempt to get people to focus on what winning traders do rather than avoiding what losers do, people may want to take a look at the posts made by victor niederhoffer (well known fund manager and george soros protege) under the name profturf, and also the legendary don bright (under the name don bright) over on et.

niederhoffer, in his few posts, always emphasised the need to be courteous when addressing those who are knowledge rich, but time poor. i should point out, that niederhoffer was always in a positive mindset to state genuine helpful advise and findings that people could tangibly incorporate into their strategies if they so wished - and thought about what was being mentioned. topics discussed were very much tangible rather than mystery. whether one agreed with his approach is another matter, but i imagine he has made (and lost) more money than most of us! here was a real 'wizard' giving away a few ingredients out of his 'magic book'.

the same could be said of don bright as well to a lesser extent. a proven trader giving genuine useful help and advise (although knowing don, i would have thought he would be way too humble (as most good traders are) to be thought of with the likes of victor).

im just thinking of this attitude, merit and conduct thing, and something doesnt seem to be sitting right somewhere, especially when i think of those proven traders and their attitude, merit and conduct!

Something to consider:

"One thing that I have found true, is that when a person actually knows what they are talking about, they are able to describe it in simple declarative sentences, without jargon, and in a way that all of us can understand and make use of."

 

[PKFFW]

Actually, PKFFW, you are quite right, and Bertie is, as usual, quite wrong. Abstract intangibles? Dangerous unknown? These are only a few of the bogeymen that Bertie references to frighten the unwary beginner.

There is nothing mysterious about learning to trade. There is no "ethereal knowing", as Bertie puts it. It's all really very simple, which is not to say that it is easy. A great deal of work must be done, but one needn't be particularly special to do it, unless one considers anyone who actually does it to be special for having done it.

The Big MAC that Bertie has begun to tout is largely nonsense, something to inspire awe in those who are looking for someone to tell them what to do. But, of course, Bertie refuses to tell them what to do. Nice how that works out, isn't it? Could it be instead that Bertie refuses to tell them what to do because he hasn't the slightest idea?

There is much here that will be of benefit to you if you're willing to do the work (not "here" as in this thread, but here on this site). And it won't take you 15 years.

Here's hoping you get a chance to read this before it's deleted.

This is pretty much what I figured. So far I've been reading books, articles, threads on the forums etc. It all seems pretty straight forward to me really. As you say, not easy, but very simple. Will take a lot of practice to change my preconditioned way of thinking. Will take lots of practice to get the hang of reading charts. Will take alot of hard work. In the end though it is a skill like any other that can be learnt. That is what I will do. Will I be the worlds best trader? I doubt it. Will I be profitable? Yes, eventually. That's the end point isn't it? To be profitable.

Cheers,
PKFFW

 

[new_trader]

This is pretty much what I figured. So far I've been reading books, articles, threads on the forums etc. It all seems pretty straight forward to me really. As you say, not easy, but very simple. Will take a lot of practice to change my preconditioned way of thinking. Will take lots of practice to get the hang of reading charts. Will take alot of hard work. In the end though it is a skill like any other that can be learnt. That is what I will do. Will I be the worlds best trader? I doubt it. Will I be profitable? Yes, eventually. That's the end point isn't it? To be profitable.

Cheers,
PKFFW

Excellent post PKFFW. Developing and sticking to a trading system will immediately put you in the top 1% of traders. It only took me about 6 months to get there. That is not a guarantee I will make money, but NO TRADER can do that.

 

[boy trader]

quite a interesting conumdrum

the fact is people who have made a lot of money are either lucky or have combined good money management with superior analysis

nothign more nothing less

 

[new_trader]

quite a interesting conumdrum

the fact is people who have made a lot of money are either lucky or have combined good money management with superior analysis

nothign more nothing less

The harder you work, the luckier you get

 

[chump]

The more time I have created in which to consider making money the less I need to work at being lucky.

 

[Finlayson]

as i believe has already been said by tsuntzu....trading in its essence is simple , not nec easy....but simple , after all it is created by us & without humans it would not exist......so why would you need to be a supreme being, or of a particlularly enlightened state to succeed( to ur own personal degree) .as long as you have an ability to function & reason then you can apply logic to a market.

like many things , its essence is quite simple.....but we sometimes overcomplicate to rationalise why we cannot at this time 'do it'.. a period of study ( different for different people) .....& if we really desire to achieve at it, our brains will figure it out & then it is 'simple', the skills needed are learnt on the way.......bit like learning to play an intrument, or riding a bike, or to love , or play golf etc

this is how I see it anyhow
Jay

 

[new_trader]

as i believe has already been said by tsuntzu....trading in its essence is simple , not nec easy....but simple , after all it is created by us & without humans it would not exist......so why would you need to be a supreme being, or of a particlularly enlightened state to succeed( to ur own personal degree) .as long as you have an ability to function & reason then you can apply logic to a market.

like many things , its essence is quite simple.....but we sometimes overcomplicate to rationalise why we cannot at this time 'do it'.. a period of study ( different for different people) .....& if we really desire to achieve at it, our brains will figure it out & then it is 'simple', the skills needed are learnt on the way.......bit like learning to play an intrument, or riding a bike, or to love , or play golf etc

this is how I see it anyhow
Jay

http://en.wikipedia.org/wiki/Occam's_Razor

Says it all really.

 

[barjon]

mmm, interesting developments (I'll turn a blind eye to the fact that my strictures to stay strictly on topic have been forgotten here and there )

Trading is simple "buy what's going up, sell what's going down" as Tsuntzu puts it so succinctly. The skills required to do that can be learnt like any other as suggested by Finlayson and PKFFW amongst others. And " a great deal of work must be done" as dbphoenix says since it's not easy.

Well that seems pretty straightforward so why then, in the title of the thread, do so few succeed? Or is the reported over 90% failure rate just another "bogeyman" invention to deter others from joining in and enjoying the rich pickings to be had?

Or is there something more, as alluded to by socrates in his abstruse way? (like others I wish he would be less abstruse and more understanding, tolerant and respectful of others - oh dear, I may have to delete myself when I housekeep the thread ).

Continuing my earlier analogy - golf, too, is a simple game. Just knock the ball from A to B and pop it in the hole at the end. The skills required to do that can be learnt and much hard work must be done because it's not easy. Many, many thousands learn those skills and put in the hard work, but only a relative handful succeed in making a living at it. So what is the "edge" of the successful golfer? Is it natural talent, or mindset, or what?

good trading

jon

 

[charliechan]

This has turned into a very amusing thread although far too time consuming to stay on top of. I find Socs. posts always bring a rye smile to my face. I decided to spend some time over the weekend reading over some of his old posts to try and get a better handle on his higher understanding. I did actually learn a few things, I was unfamiliar with the story of Plato and Socrates and learnt that holland was not a country. That aside I didn't glean much about trading, what so ever. Now I don't have as much life experience as good old Soc. nor possibly trading experience. However I have been trading for 7 years, working in the industry for 10 years, trained 50 traders and interviewed countless trading wannabes. My first boss made 8.5mill in a year trading seldom more than 100 lots and told me everyday I would amount to nothing. My view on it all is that trading is a very personal voyage of self discovery and assistance can only be useful in mapping out the very basics of trading. Its really a very simple business, you buy what is going up and you sell what is going down. I am aware I do not know it all, I am also aware that what I lack in my trading cannot be taught, it has to be discovered through an accumulation of experience. Just as a trader has to filter the signals that the market sends out, so the same can be said about filtering out the nonsense that gets banged around on this website. All be it, filtering on here is a lot easier and not nearly as enjoyable.

and that my friends really does sum it all up!

there is probably more wisdom and truth in this one post than 20,000 threads on any web site imo.

but it is this very individual approach mentioned that creates so many different opinions that then turn into arguments and disagreement. such is life!

 

[new_trader]

mmm, interesting developments (I'll turn a blind eye to the fact that my strictures to stay strictly on topic have been forgotten here and there )

Trading is simple "buy what's going up, sell what's going down" as Tsuntzu puts it so succinctly. The skills required to do that can be learnt like any other as suggested by Finlayson and PKFFW amongst others. And " a great deal of work must be done" as dbphoenix says since it's not easy.

Well that seems pretty straightforward so why then, in the title of the thread, do so few succeed? Or is the reported over 90% failure rate just another "bogeyman" invention to deter others from joining in and enjoying the rich pickings to be had?

Or is there something more, as alluded to by socrates in his abstruse way? (like others I wish he would be less abstruse and more understanding, tolerant and respectful of others - oh dear, I may have to delete myself when I housekeep the thread ).

Continuing my earlier analogy - golf, too, is a simple game. Just knock the ball from A to B and pop it in the hole at the end. The skills required to do that can be learnt and much hard work must be done because it's not easy. Many, many thousands learn those skills and put in the hard work, but only a relative handful succeed in making a living at it. So what is the "edge" of the successful golfer? Is it natural talent, or mindset, or what?

good trading

jon

I don't think there is such a thing as natural talent. If you look at most high achievers throughout history it is obsession and dedication that is are common traits.

7 traits of successful people: I didn't copy them all

1. They are hard working. There is no such thing as easy money. Success
takes hard work and people who are willing to do it.

2. They are honest. Those who are successful long-term are the honest
ones. Dishonest people may get the first sale, but honest people will
get all the rest!

3. They persevere. How many success stories will go untold because they
never happened? And all because someone quit. Successful people outlast
everybody else.

4. They are friendly. Have you noticed that most successful people are
friendly and people oriented? This endears them to others and enables
them to lead others to accomplish the task.

5. They are lifelong learners. Successful people are people who stretch
themselves and grow continually, learning from
all areas of life, including from their mistakes.

6. They over-deliver. The old statement of under-promise and
over-deliver became famous because it made a lot of people successful,
including the richest man in the world - Bill Gates

7. They seek solutions in the face of problems. Problems are
opportunities to do the impossible, not just complain. Successful people
are the ones who find solutions.

 

[Finlayson]

Jon
you hit on a good point there with the analogy of golf ( love the game myself.........only a few do make it to the top with a lot of hard work & get payed big money....but then there is a cream you have to be in (hierachy, level , call it what you want) to get this money from winning the big game , sponsorship etc.......there are also lower levels in the pro's who make a good living touring but not making the huge amounts...then there are lower levels like mine who are very happy to Par a whole & extremely happy if they better that........but still successful to my degree because the measure of success in golf ( to me) is putting the ball in the hole & how many....not money.

in trading however money is always an end result ( + or - ).....you just work to your own degree of success & move on from there. of course if you are completely losing( not hitting the ball) you really need to knuckle down & do some work. but each hole (trade) is a challenge with yourself ......not a huge 'scary' entity that is 'out to get you' at every try.....if it is seen like that is just well may be.

if you constantly measure yourself against the big pro's you will have along way to go.....if you constantly measure your game against yourself you will progress, be it in your own time.

what is that saying....if a foot compares itself to a yard.....it will always come up short

have your hero's & role models.....but dont shoot yourself because you are not them

maybe this 90% is made up !....why worry about it..


P.s ......do you play Jon ?

Regards
Jay

 

[new_trader]

Jon
you hit on a good point there with the analogy of golf ( love the game myself.........only a few do make it to the top with a lot of hard work & get payed big money....but then there is a cream you have to be in (hierachy, level , call it what you want) to get this money from winning the big game , sponsorship etc.......there are also lower levels in the pro's who make a good living touring but not making the huge amounts...then there are lower levels like mine who are very happy to Par a whole & extremely happy if they better that........but still successful to my degree because the measure of success in golf ( to me) is putting the ball in the hole & how many....not money.

in trading however money is always an end result ( + or - ).....you just work to your own degree of success & move on from there. of course if you are completely losing( not hitting the ball) you really need to knuckle down & do some work. but each hole (trade) is a challenge with yourself ......not a huge 'scary' entity that is 'out to get you' at every try.....if it is seen like that is just well may be.

if you constantly measure yourself against the big pro's you will have along way to go.....if you constantly measure your game against yourself you will progress, be it in your own time.

what is that saying....if a foot compares itself to a yard.....it will always come up short

have your hero's & role models.....but dont shoot yourself because you are not them

maybe this 90% is made up !....why worry about it..


P.s ......do you play Jon ?

Regards
Jay

I sort of look at it in reverse. When I first started trading (spread betting), I did very badly, kept losing money and was ready to give up. "I just don't have what it takes" is what I thought. However, I HATE giving up and was determined not to be a "failure" so easily. I started doing really serious research on the subject and realised that 97% of people fail because they do what I was doing and then actually give up. So I don't so much look at the top 3% and aspire to be exactly like them, I look at the 97% failures and try to avoid being one of them. This will by default put you in the top 3%!

 

[barjon]

.....................P.s ......do you play Jon ?............................

Jay

jay,

"play" being the operative word

I think you're right to say "measure yourself against yourself" to which I would add pick your playground.

I have no pretensions as to my abilities as a trader and I know I'd get slaughtered trying to compete with the pros. Thus I stay clear of their playground (futures, day trading and the like) only venturing in occasionally for a bit of fun.

good trading

jon