After six weeks of pediatrics, six weeks of general surgery, six weeks of radiology, and six weeks of psychiatry, students begin to gain a sense for the kinds of medical practice that speak to their strengths and interests. Most of all, they learn which of the fields is fun. Students destined for surgery and emergency medicine are a bit like David; they gravitate toward active practice fields. Research physicians are more like Ellen, finding their fulfillment in problem solving and the analytical process. Each group finds its own path through the developmental process, cultivating what comes naturally and most enjoyably to them.
Traders rarely have the opportunity to pursue fun and sample different specialties. How many of us have attempted position-trading volatile instruments like Sherry, and then scalped deep electronic markets like David? Imagine approaching trading as if it were medical education: trading baskets of stocks for 6 weeks like Pat, developing a trading system for precious metals futures over the next 6 weeks, and then spending 12 weeks building currency positions based on macro analyses. The odds are good that, like medical students, we would hate some of the experiences and love others. Those emotional responses would be informative, because they would start us on a track where we could then develop ourselves in our preferred areas.
This is precisely the first step to take on the performance path. Before committing to a market or style of trading, you need to experience what it is like to trade frequently and how that differs—cognitively and emotionally— from holding positions. You need to immerse yourself in different markets and feel the difference between trading such instruments as large-cap stock indices, microcap stocks, energy futures, Treasury notes, euro currency, and equity options. Such experience teaches you much about yourself—and about markets.
Without exposure to different trading activities, traders are a bit like partners in an arranged marriage. Maybe the arrangement will be a good fit; maybe it will be a disaster. It probably won’t be fun. And, as Benjamin Bloom found out, it is difficult to sustain a commitment without that emotional bonding. How many traders never progress through the stages of mastery not because they’re lazy, but because they’re simply in the wrong place? If, even after a period of courtship and engagement, half of all marriages end in divorce, how can we expect to make better decisions about the markets we marry without so much as a few dates?
It’s not whether you can be a good trader; it’s whether you can find the trading that’s good for you.
We started by distinguishing experts from novices and found that experts are engaged in learning loops fueled by deliberative practice. The question then arose as to why more traders are not traversing these loops. Desire for an easy lifestyle and quick riches no doubt sabotages the pursuit of excellence for some traders, but Bloom’s research suggests another possibility: Perhaps the initial focus on intensive practice is misplaced. Many traders have problems with their discipline for the same reason that young men have trouble committing to relationships: They’re just not ready. If you’re having performance problems in trading, instead of berating yourself with exhortations about discipline, perhaps we should figure out the answer to this question: What experiences will help you move through your developmental process, so that you’ll eventually want to make—even crave making—a disciplined commitment to your work?
The famous American inventor Thomas Edison once noted, “Genius is one percent inspiration, ninety-nine percent perspiration.” Many people missed opportunity, he said, because it dressed in overalls and looked like work. Yet he also claimed, “I never did a day’s work in my life. It was all fun.” That is the paradox of expertise: It is hard work—and it is fun. In fact, it is so much fun that we spend long hours at it and become highly skilled as a result. If you simply focus on the work part, you’ll see nothing but overalls and miss life’s opportunities. If you have nothing but fun, all the inspiration in the world won’t make up for the absence of perspiration. But to perspire at something that is all fun—that is possible only to those who have found their niche in life. Does such a niche exist for you in the trading world? Let’s find out.
Read More : How Do Traders Find Their Niches?
