Three Things My Son Taught Me about Trading

30 04 2008

Tom Gentile, Profit Strategies.com
April 7, 2008
http://www.optionetics.com/market/articles/19312

Watching kids grow up is amazing. The processes we all take for granted were once major challenges for all of us. And what really impresses me is how they seem to take to most things like a fish to water—first looking at each new endeavor, then assessing it, and finally accomplishing it. Thinking about a recent trip to the ice rink, I realized that his learning process had some profound lessons for us as traders.

First, he is single-minded and on purpose. Though falling down a lot, he realized that ice skating was possible, and he chose to go everywhere on those skates. Unless there was some tight crowd he couldn’t get through, he was up trying to skate

Second, he is unstoppable. If someone or some object got in his way, he would just skate around them. He would skate not only the way everyone else skated, but even against the crowd, scaring most of them. Not because he was or wasn’t supposed to, but just because he could.

Third, he is failure-proof. When he started off, he fell down every few feet. He realized, however, that all he had to do was to get up, and he could be off on his skates again. Getting up became easy, and falling down became less frequent. Even when he fell in a way that would cause me to wince, he just stood right up, because getting up after falling down had become second nature for him.

And you know this is a proven Success Formula. In some form or another we all learned this lesson growing up.

How Does This Apply To Investing?

First, Be Single-minded and On-purpose. To do this you have to have a goal. For example, “I’m going to increase my wealth by $1 million by getting a trading plan and following through on that plan.” And you have to have a plan to reach your goal—i.e., “I’m going to get good at process of calendar spreads, or straddles, or the forex markets.” Keep your focus on that goal.

Second, Be Unstoppable. If some challenge comes up, figure out a way around it. If you’re having trouble getting fills, don’t whine. Evaluate why, improve your execution skills or try something else—perhaps a new broker.

Third, Be Failure-proof. Remember challenges. “Falling down” is part of the process. Get up and keep on going. In time, the getting up will become easy and second nature, and the challenges will become less frequent. Knowledge in this business without application is like worrying about falling down so much that you never try to skate. Get out there and start doing it!

Tom Gentile
Chief Strategist
Profit Strategies Group, Inc.


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