10,000 hours to greatness and the Mastery Asymptote

regarding personality tests, here is an interesting point of view.
http://www.gladwell.com/2004/2004_09...rsonality.html

I really enjoyed the readings, tanks for sharing, in the last 3-4 pages of the thread "how did trading changed your life?" there is a good discussion about edge, luck and psychology about trading.

I was already aware about setting goals (daily, monthly) the reading gave me some more fuel, really many many thanks!!

I was thinking today

Another we can do that will be helpful for traders is this....Along with a listing of books on this topic how about a book review??

This could be a cut and paste from another source.. But I think it should also contain some information oh how it helped you personally as a trader.

I went to town today and looked for "What the Dog Saw" could not find it but picked up "Blink" by the same author. I will dig into this one and post my results.

From Malcolm Gladwell's web site

It's a book about rapid cognition, about the kind of thinking that happens in a blink of an eye. When you meet someone for the first time, or walk into a house you are thinking of buying, or read the first few sentences of a book, your mind takes about two seconds to jump to a series of conclusions. Well, "Blink" is a book about those two seconds, because I think those instant conclusions that we reach are really powerful and really important and, occasionally, really good

Sounds like the decision to put on a position to me

So any takers? This thread could be a virtual library of information on how we could potentially shorten up that 10'000 hour mark.

Safe trading all

Rufus

i'm waiting for:"how i lost a million dollar", it should arrive in these days, i'll be more than happy to make a review

Hi Rufus:

I recently finished reading the entire F5 thread and have begun trading it on a live account. Your contributions to that thread are fabulous. Your enthusiasm and unselfish contributions say a lot about you as a human being.

I am a life long trader that for the past 2 years has been in private training to day trade. Only in the past year have a gained enough confidence in my systems that I am realizing success.

I am always interested in the psychology of anything. 35 years ago I was introduced to Psychology of Winning by Denis Waitley. I recommend it to anyone who wants to learn about winning in any endeavor.

Having the right attitude about what you do and how you do it is critical to your success and ability to win in anything. Trading is not different.

In one of your posts on F5 you said, "It is the job of your trading system to collect pips. It is the job of the trader to execute the system". You are more correct in this statement than you probably realize.

This is the ultimate truth of trading. To be successful, you must commit all of your efforts to watching the charts and pulling the trigger when the setup occurs and placing stops and profit targets determined by your trading rules. Then you need to monitor the trade and adjust as necessary as it progresses.

Just like an airplane pilot or a middle linebacker in pro football, you have trained and prepared to execute your system. That is your only job and you need to be focused on that to the point that you are not aware of the time of day or if you are making money or losing money. Time and money have nothing to do with what we as traders are trying to do. We are simply trying to implement a system that we have full confidence in so that the system can make us money.

Below is something I wrote over a year ago and I begin each trading day by reading it out loud to myself. It is the only psychology I need.

Who I Am and What I Do

I am a professional trader and my success results from following my trading strategy rules perfectly without any influence of fear, greed or subjective thought.

I trade systems that I know have a proven edge to make above average returns in the markets. These systems are not perfect and have periods where they will sustain losses and appear to fail.

My business of trading is similar to being a black jack dealer in a casino. The odds are always in my favor. All I have to do is consistently follow my rules. From time to time, the market will win, but if I simply follow my rules, I will be a significant winner in the long run.

The only keys to my success are first, to constantly watch the market so I do not miss any trades and second, to follow the rules required for each trade as it develops. If I do that I will achieve my financial goals. I don’t second guess the trading systems. My success is not based on what I know, what I think I know or what I want or what I fear. My success will come by following the rules of my trading strategies.

Trading is a competitive game in which I compete against hundreds of thousands of traders throughout the world. I keep score using a daily log of trades. That log shows everything about every trade I take and after each trade I score my performance on a scale of 1-5, by how well I followed the rules. My score has nothing to do with the profits or losses the systems may generate.

My goal is to watch the market continuously, to identify every trade up correctly and then take the trade and follow the rules for exit.

The world is ever-changing and so are the markets. I will continue to search for better trading methods, better markets to trade and better trading rules. There will come a time to change my strategies and rules and to develop new ones. Until such time, my main goal is to win following the rules I have set, because I know that by following these rules, I will be a winner.

I hope this helps.

Hi Cmpturk

Thank you for the kind words.

Lately I have been going through one of those spells where nothing seems to work.

Reading what you wrote reminded me of so much. Thank you.

This trading that we have dedicated so much time to is an ever interesting business. Below is a quote you might appreciate.



"The symbol of all relationships among such men, the moral symbol of respect for human beings, is the trader. We, who live by values, not by loot, are traders, both in matter and in spirit. A trader is a man who earns what he gets and does not give or take the undeserved. A trader does not ask to be paid for his failures, nor does he ask to be loved for his flaws. A trader does not squander his body as fodder or his soul as alms. Just as he does not give his work except in trade for material values, so he does not give the values of his spirit-his love, his friendship, his esteem-except in payment and in trade for human virtues, in payment for his own selfish pleasure, which he receives from men he can respect. The mystic parasites who have, throughout the ages, reviled the traders and held them in contempt, while honoring the beggars and the looters, have known the secret motive of their sneers: a trader is the entity they dread-a man of justice."

Atlas Shrugged
Rufus

　

Rufus:

Your statement "Lately I have been going through one of those spells where nothing seems to work. reminded me of a recent study that I can't seem to find.

The study was about traders and how they tend to lose confidence in what they are doing. What the study found was that traders can have 100 trades and win 65% percent of the trades and be making money and be confident of their system and their ability as a trader.

If by chance these same traders lose 4,5,7 trades in a row and have a significant drawdown, those most recent trades have a high probability of totally changing the confidence of the trader and inhibit the trader's ability to perform in the future. When traders who participated in the study were asked about the historical performance, they discounted the significance of the previous 100 trades and weighted the value of the most recent trades far more significantly than the previous 100.

The study concluded that traders are more prone to being unreasonable and fearful if recent events do not result in a manner they expect and this phobia probably results in the demise of many traders who are unable to view the recent events as a small and probably insignificant piece of their trading career. An example being that if a trader has a significant drawdown from recent trades, he is more likely to tighten his stop loss and take profits sooner and thereby reduce the profitability of his system.

We must be the blackjack dealer. It doesn't matter how much money the house lost on the last 5 hands. Our job is to deal the cards again and follow our rules. Don't forget, we will win in the long run if we don't change course in midstream.

Yes it is very easy to start questioning the system and also start taking profits to soon. I have fallen into that trap before and always seems to be a hole their looming in the darkness for traders to step into then start spiraling down a vortex of indecision and confusion.

For me.....

Whenever I get a string of losses I like to got for a walk and spend some time with my horse Buddy. Working him in the round pen or a trail ride does wonders for my mental disposition. Then when I return to trade I cut my position size in half then get a string of winners then tweak it back up to my normal risk. (1%)

Incidentally they have proven that time with a horse, as little as 20 minutes slows down your heart rate and calms you. I have enjoyed horses for many years and always thought that. I have seen some of the harshest kids get on a horse and become a different person for a while. They even use wild horses in two different prisons I know of for the prisoners to train. It is something else to see a hardened criminal with tears in his eyes when he gives up his horse he has trained to a buyer. Then he gets to start again with another.

Ah well...it is a slow market right now.

Thanks for the post. It is a valuable lesson all should remember....We are a Blackjack dealer. Not the player going double down.

Rufus

Think & Grow Rich

By Napoleon Hill

All in all this was a good read.

“All achievements, all earned riches, have their beginning in an idea.”

“You might well remember that nothing can bring you success but yourself.”

“If you are ready for the secret, you already possess one half of it.”


This book is a collection of principles for the attainment of wealth and financial independence. It was written by Napoleon Hill at the behest of American steel magnate Andrew Carnegie, who was fascinated with success and wanted to understand why some men became successful while others in very similar circumstances did not.

Over two decades, Hill interviewed 504 people, including such luminaries as Ford, Wrigley, Wanamaker, Eastman, Rockefeller, Thomas Edison, Woolworth, Darrow, Burbank, Morgan, Firestone, and three United States Presidents. Most of those interviewed began in poverty, with little education and influence. Yet, they all managed to become very successful at amassing staggering amounts of wealth. Hill distilled his findings into a 13-step formula that begins and ends with very basic principles.

Now from a traders perspective.

A large portion of this book is invaluable to a trader for its information on having the proper mindset for business. We know that trading is to be run like a business for it to be profitable. Sections of the book are a bit wordy and others really did not apply to my goal with reading this book, so I skimmed them. For instance how to go to a job interview. Then there is another section that I flat don't agree with at all, but it did not affect the overall quality of the content in my opinion.

The focus of the book is acquiring the proper mental attitude. The steps required to get it solidified in your life and how it is stolen away at times.
The examples he uses are great.

I will be reading this one again in the near future. By the way there are very few books I will read more than once. This one is worthy of going through with more detail.

Well I hope this helps someone if they are considering to read this.

Rufus

jesse livermore, read anything this guy says, he is my inspiration

keeps it simple, looks at the overall condition of the market,
and scaling in a trade is a fabulous idea, put in your initial risk capital, if you are right, youll have a chance to unload on your second position.

I learned another thing about Jesse Livermore the other day. He did not like referring to a market as being bull or bear...Kept his head on straight concerning positions.

Acording to that test i'm a ESTP person (artisan promoter) wich describe me pretty well. What i want to know is how "artisan promoter" and forex trading fit?

Does it really require 10000hours to become a professional trader? From my humble opinion, I believe it varies according to each individual. As 10000hours can mean a lot to different people and at the same time mean nothing to one.

May I know is there anybody who achieve the state of being constantly profitable/professional trader before 10000hous ? It would be a blessing if you would like to share how many hours have you spent to be in that state.

Thank you in advance.

Funny you mentioned this book, I wrote a post about it on my blog about a few weeks ago. Really some of the greatest books made, IMO.

Did you know that Think & Grow Rich is a distilled version of The Law of Success? Hill wrote the second book to make money as he was constantly in financial trouble (he documents that in the first book) having earned a lot and then spent a lot (he spent so much he got into debt). I've listened to the audio versions of both books and I can tell you that the The Law of Success is by far superior, although it gets a little repetitive from time to time. There's more information on the first book on Wikipedia (link above).

Both books are in public domain and you can download a legit PDF copy from archive.org:
The Law of Success
Law of Success: 21st Century Edition (follow the link to the document description at archive.org for information on what's different in the 21st Century Edition)
Think and Grow Rich

It may not take 10,000 hours to be profitable....To be a "Master" will, in my opinion. My goal is to be a Michelangelo or Leonardo Da Vinci of the Forex market.

Rufus Da Vinci

From the book "Blink"


Whenever we have something that we are good at - something we care about - that experience and passion fundamentally change the nature of our first impressions.

I am about 3/4 the way through this one and it is a very interesting topic. I am looking forward to writing a review on this one. Looking at this topic inlight of trading has been great.

Rufus

http://en.wikipedia.org/wiki/Reticular_formation

5. Habituation - This is a process in which the brain learns to ignore repetitive, meaningless stimuli while remaining sensitive to others. A good example of this is when a person can sleep through loud traffic in a large city, but is awakened promptly due to the sound of an alarm or crying baby. Reticular formation nuclei that modulate activity of the cerebral cortex are called the reticular activating system or extrathalamic control modulatory system.


Some of you may recall a thread where the above topic was discussed. I am now seeing the vital importance of it and it is worthy of study.

In the picture below by the use of your Reticular Formation you can make the girl spin left or right, then with a little practice make her skip back and forth.

If the Reticular Formation can filter out meaningless stimuli while remaining sensitive to others. Why would this not be used when it comes to trading? The amount of pointless movement in the chart is massive, so if we fixate on every nuance we will miss the cue that will be the signal for a move in price that will be profitable.

The chart is nothing more then the face of the market. Some wrinkles and expressions are meaningless. Others are the cue we need. What is the look on a girls face when she wants you to give her a kiss? What is the look when you have gone to far? That is the accuracy that I believe a trader can read the face of the market.

I can tell when my horse Buddy is thinking about doing something wrong. I could never explain what I see though. How many times have you looked at a chart and said to yourself that this is going to bust out of here, analyze it a bit, convince yourself that you are wrong only to see a 50 pip 5m candle form. Then you are left standing there missing the ride when you saw it to begin with. Reticular Formation?

Some things I was thinking about today while spending time with buddy in the round pen.

Oh!! As for the dancing girl...I can make her skip


Rufus Da Vinci

In all respect, I think many of the questions concerning the number of hours and the state of mind and if people born under certain astrological signs can be successful traders is missing the point.

IMHO, none of this has anything to do with being a good trader. I believe the 3 items below are critical to success.

1. Every trader must have one or a few trading systems that have setups, triggers and exit strategies that are proven to give you an edge in the markets. How much do you trust your trading strategy? If you have any question about it, you are doomed, because the first time you take 5 losing trades in a row, any question or doubt you had about your system in the first place, will have become verified and you will likely abandon it and start all over.

2. You must trust your trading strategies more than you trust your husband, wife or best friend. No 2 trades the same. With every trade, there is plenty of room for us to subjectively analyze the situation to the point we decide to modify the techniques that we "know and believe" works for us. We can talk ourselves into believing "it is different this time so I'm going to do something different on this trade" or pass on the trade all together. As long as we trade, we will all make this mistake. The difference between successful traders and the rest, is that the successful traders make this mistake far fewer times in the course of their career.

3. In trading you most be emotionally agnostic to the outcome of your trade. No matter how well we execute our systems there are many factors that we do not control that will cause a trade to become a loser. Since that is true, is there any reason for us to be upset with a losing trade? Emotion in trading is death. As I said in an earlier post, we most be like blackjack dealers. We will lose money at our table for a while, but if we follow our rules we will be winners.

In summary, IMHO, every trader must:

1. Find systems that fit their trading style that they have backtested in all type of market conditions so that we are confident that the system is a winner. Then they must write down the rules to this system and follow them to the letter.

2. Patiently watch the charts and execute trades when they meet the setup rules of the system and follow the trades through to completion.

3. No matter what the outcome, do it over and over again.

I assure you that the above 3 issues are far more difficult to accomplish than they sound.

We can all believe that we are confident, but confidence is only achieved from a significant amount of successful repetition.

Unfortunately, most of us have good intentions of improving our mind, our body and our way of life, but in reality we aren't strong enough to make the changes necessary to actually achieve our intended goals.

If we continue to do in the future, what we have done in the past, we will get the same result.

Don't believe that if you experience enough failure you will ultimately achieve success. The 2 are not related. Success in trading comes from overcoming doubt and fear and following rules and having the discipline not to be distracted during your trade time. Failure in trading is related to fear, doubt, laziness and a lack of discipline.

I think this thread can be used for traders to discuss specific problems they are having problems overcoming and then we can learn from how others have successfully overcome those same problems.

Truthfully, the longer I trade, the more I realize it is a very difficult job that I seem to enjoy less and less each day. I have been financially successful for over 9 months and I have found that my profitability is correlated to the volatility of the markets. During low volatility periods, I make little, when the volatility picks up, I make a lot. I don't believe in profit goals because, I can only make what the markets allow. I grade myself on every trade and my average grades have increased in most months over the past year.

There is nothing sexy about this business. But when you are 56yrs old, unemployed and want to continue to live a life style you have become accustom to and are willing to change, trading works.

If you are comfortable in your current lifestyle, I believe becoming a successful trader is far more difficult.

Everyone is different and I know that because of that fact, general opinions such as those I put forth are worth very little. What counts is how committed each trader is to making the changes in their lives necessary to be successful.