Doing This One Thing Has Strangely Helped Me The Most In My Trading Career

This is a strange one. And it goes against conventional wisdom. But whoever said conventional wisdom was actually wise? Your trading career, like mine, may end up coming down to going against the crowd and doing the ‘unconventional thing’.

So what is the unconventional thing that strangely helped my trading career the most? It’s… quitting. Huh? What’s this guy talking about? Well I don’t blame you if that’s your reaction but give me a second to explain. I don’t mean quitting trading. I’ll be a trader for life. What I mean is quickly quitting the paths that aren’t working.

This might seem obvious, but trust me it’s far from it. I know countless traders who are on a fruitless path in their trading career. They’re going about the learning process the wrong way, and the kind of things they’re learning will never translate into a true edge in the markets for them. But they stick to it. Sometimes for years. Why? Well, naturally, because winners don’t quit! That is the conventional wisdom after all. How can they quit the path they’re on? That’s only what losers do.

But it’s conventional wisdom because the majority adopts it. And I don’t have to tell you what happens to the majority in trading. So how should you approach things if you’re a developing trader learning to become profitable? First, get good at quitting.

When I was first starting out in my trading career, I experimented with dozens of styles and strategies. Whenever I was experimenting with a style, it didn’t take me long to figure out if it resonated with me on a deeper level. i.e. If I enjoyed trading it and really believed in its principles and understood the logic behind it. If after a week or two of trying it out something felt off about it, I quit it. It may have been that it really didn’t jive with my personality. Or that it didn’t challenge me to learn and observe the markets at a deep level. Or that it just made no logical sense in its market principles and assumptions. I could only find these things out by trying it for a while, but once my gut told me something was off, I quit. Immediately.

Now this isn’t the same as jumping from one indicator or strategy to another looking for the holy grail. The traders doing that are chasing a magic system, and whenever one has some losses or a drawdown they abandon it and jump to the next thing. By contrast I was quickly quitting the paths that I felt weren’t right for me in becoming a consistently profitable trader based on more meaningful reasons.

Contrast that to what a lot of traders unfortunately end up doing. They hear that you have to stick to it and not give up. You can’t be a quitter. Just practice for several years and you’ll become profitable. But they’re practicing a style and strategy that either has no edge or doesn’t personally fit them (in which case they won’t be able to execute it and they’ll still end up with no edge). They can feel that deep inside, but their mind is great at rationalizing that they’re progressing, and conventional wisdom is on their side. So they stick to the fruitless path and make no progress.

My advice to you is not to fall into that trap. Don’t jump around from one style and strategy to the next because you can’t tolerate losses- that’s not what I’m getting at. But also don’t stick to a style that’s not working for you, or one which you can’t grasp the essence of or believe in its principles. That’s not going to further your trading career. Instead, get good at quitting. Quit what doesn’t feel right. Quit what doesn’t work. Quit what’s wrong for you. Then move on until you find your fit. And once you do, you’ll know it. Maybe the profits won’t be there right away as you take your time to learn and develop your skills, but you’ll know it. Trust that, and only then stick to it. Your trading career will thank you.

  • Ryan

    Your article touches upon another aspect of trading which is overlooked. The need to have a sufficient amount of capital that will allow you to quit and move on when a style of trading is not working for you. My personal feeling is that new traders need at least one year to find out what style of strategy works for them ie: try and quit approach. A shoe string budget may have a new trader investing in an approach where they need a quick pay out regardless of suitability. The process you have described above does not come cheaply even if It is a good approach.

    • I absolutely and wholeheartedly agree Ryan. One of the most important things by far is having enough capital to give yourself the chance to go about the learning curve correctly. If a trader rushes it and needs to make money quick, they will short-circuit their learning process. It personally took me over a year to find my style and become comfortable with it. Thanks for the great comment.

  • Mike

    Great post. Appreciate the insight.

    • Thanks Mike. Glad you liked it and hope it helps!

Post Navigation