There isn't an immediate comparison, perhaps, to be made between trading and police work. But today I wrote a message to a friend who works as a police officer in one of the largest cities in the world, and started to write out some thoughts about how trading and police work could possibly be compared. I thought I would share the thoughts with everyone to see if there could be some discussion (constructive) about some of the ways that other experiences in life relate to trading. Here's what I wrote to my friend:
1. When confronting someone who might have done something wrong, or in the process of arresting someone, do you ever wonder why a person who has done something wrong doesn't want to admit it at first? Why don't they just come clean? I suspect that can be frustrating. Well, that bad dude is like a bad trader that won't admit they made a bad trade -- and so they just keep letting it get worse and worse.
2. Do you believe that work as an officer can be chaotic? But at the same time, you've pretty much seen it all? It's that strange dichotomy that exists in trading, in my opinion. The market can be chaotic (self-regulating), but once you dive in and start to understand the underlying patterns, there is not much that surprises you. Let me put it another way:
3. Do you feel that on a rough evening as an officer, you just have to "go with the flow," that to fight the negative stuff coming your way is just going to be counter-productive? Well, it's the same in trading. You don't fight the market. You put yourself in a position to stand back and take advantage of what comes your way, or you make sure that you stay out of the way of the bad stuff (this is where you have a choice in trading that you don't as an officer).
4. Would it be fair to say that the best officers understand the "mental" side, the "psychological" side of their jobs just as much as they are in good physical shape? They have both mental and physical strength? Well, it's the same for trading. You do the best when you have a strong mental foundation AND the skill set. You can imagine that the dumbest guy who is in great shape can never be a police officer. Well, the dumbest guy (really poor money management techniques) with the greatest trading system in the world is not going to make any money. You can imagine, too, that there have been some great officers and detectives who were not necessarily Jack LaLane or Mr. Universe. Well, that's the same for the some very good traders: they have a valid mental perspective and that can compensate for the fact that they might not know some "secret" trading system, or possess some "inside" information about the direction of the US dollar.
1. When confronting someone who might have done something wrong, or in the process of arresting someone, do you ever wonder why a person who has done something wrong doesn't want to admit it at first? Why don't they just come clean? I suspect that can be frustrating. Well, that bad dude is like a bad trader that won't admit they made a bad trade -- and so they just keep letting it get worse and worse.
2. Do you believe that work as an officer can be chaotic? But at the same time, you've pretty much seen it all? It's that strange dichotomy that exists in trading, in my opinion. The market can be chaotic (self-regulating), but once you dive in and start to understand the underlying patterns, there is not much that surprises you. Let me put it another way:
3. Do you feel that on a rough evening as an officer, you just have to "go with the flow," that to fight the negative stuff coming your way is just going to be counter-productive? Well, it's the same in trading. You don't fight the market. You put yourself in a position to stand back and take advantage of what comes your way, or you make sure that you stay out of the way of the bad stuff (this is where you have a choice in trading that you don't as an officer).
4. Would it be fair to say that the best officers understand the "mental" side, the "psychological" side of their jobs just as much as they are in good physical shape? They have both mental and physical strength? Well, it's the same for trading. You do the best when you have a strong mental foundation AND the skill set. You can imagine that the dumbest guy who is in great shape can never be a police officer. Well, the dumbest guy (really poor money management techniques) with the greatest trading system in the world is not going to make any money. You can imagine, too, that there have been some great officers and detectives who were not necessarily Jack LaLane or Mr. Universe. Well, that's the same for the some very good traders: they have a valid mental perspective and that can compensate for the fact that they might not know some "secret" trading system, or possess some "inside" information about the direction of the US dollar.
