10,000 hours to learn trading - Who wrote this rule?

[jk90029]

10K hours is almost 10000/(7*20*12)=5.95=6 years if we spend 7 hours in 20 days every month.

I agree that at least we need 6 years of PnL curve for comfortable continuation.

For example, 1)if the PnL shows compounded 10% over SnP, then we expect roughly 1.1^6=1.77 and 2) 15% over SnP, then 1.15^6 =2.313061 which implies 2.31 times.

Most trader may have 50 years (from 30 to 80) so that 1) 1.1^50= 117.3909 times and 2)
1.15^50 = 1083.657 > 1000 times.

Tell me if some traders made 1000 times of the initial seed.

 

[jk90029]

Of course, the above is before tax+commission as well as expense.

 

[Handle123]

Finding the Holy Grails takes evolution. You do have to be "smart" to design develop R&D the system rules. Then you have to "dumb" yourself down to trade the rules.

The "dumbing" part is so difficult as transition from brilliant to minimal employee and some understand of what we see on the screen is usually lies. But HG systems seldom are able to manually trade from my experiences.

 

[volpri]

Praxis is the key. But the right praxis. To develop a skill you have to practice. To develop a good skill you have to practice good information. Enough praxis produces a habit and unconcious execution.

Many things can affect the time element.

1) The right kind of praxis. Too many trader practice the wrong stuff for way too long ....as they search...bad habits are developed. In short, wrong praxis. Many things have be unlearned. Bad habits replaced with good habits..etc

2) The level of commitment to the right praxis. Steady not flighty nor sporadic.

3) Taxonomy. Some things have to, or need to be learned before other things.

4) Psychology. This is the big one. Lack of proper psychological skills trip up traders more than anything else. Two traders can attempt to trade the same exact system and get different results “miles apart” and the definitive performance difference is tied directly to their psychological underpinnings.

All this said it may take 10,000 hours for most to work through all this. Some never will make it.

However, it does not have to take 10,000 hours. Much depends on the above and the personal gifting..ability..and makeup of the individual. Some people are so stubborn or such perfectionists they cannot learn from others and/or have to always be changing things to what they think is right for them but the problem is they have never given the right praxis the opportunity to develop the proper skills before they jump....off to another modification or an entirely new system.

It can help to see trading as a process to be practiced until execution becomes second nature. That is the weak link and probally why alot of traders go to automation to circumvent their lack of sufficient skill development in the psychological aspect of trading.

However, it will be decades maybe hundreds of years before artificial intelligence will match the capacity of the brain. Maybe never, as we humans learn to use more and more of our brain.

That is why a good discretionary trader has an edge over automation ..in the long run.

Thems fighting words....

ROFLMAO

PS with some people it will take 15 minutes to train them how to change a tire on a car and model it for them. Then an additional 20 minutes for them to actually accomplish it after learning the theory and seeing it modeled. Others it will take 30 minutes explanation and modeling and 40 minutes praxis for them to get it done. Others it may become a a 4 hour process. For others, they simply cannot learn it nor do it..always wanting to modify the procedure...finally they give up in disgust and exclaim “screw this I’ll just call the wrecker when I have a flat. This is too hard, too dirty and nasty, and too much effort”.

 

[jinxu]

Most prop firms encourage overtrading for newbs for exactly this reason - to learn.

Is that what they told you? Doesn't a Prop Firm make money from the commission they charge newbs? Hehe

 

[mbondy]

Is that what they told you? Doesn't a Prop Firm make money from the commission they charge newbs? Hehe

I think I might understand a bit more than the average person about how things work in this industry.

But as you inferred, a prop firm (provided that they are backing you with capital) makes money by taking a percentage of a traders profit. Newbs do not generate profit.

 

[Slope Trader]

Actually, nobody did. It seems highly likely that its a misconstruction of Anders Ericsson's research findings that expert-level performance of the violin required 10,000 hours of practice: he also studied top level athletes and chess grand-masters and gave them the same 10,000 hours to expert level performance.

The 10,000 hours rule was then snatched up and mis-applied to all sorts of new projects that an individual might take up, and trading is just one of these. Ericsson never studied trading.

In the spirit of Thanksgiving, I'd like to thank everyone who contributed to this fascinating thread. I just read it for the first time.

I believe strongly in the idea of deliberate practice that came out of the work of Ericsson and others and I've used the concept to improve my own trading. The 10,000 hours wasn't important to my learning how to develop systems with positive expectancies in the markets I trade, but practice was critical. Starting from an initial idea for a trading system and then spending hours testing changes based on price bar structures, indicator values and methods for incorporating volatility into the entry/exit rules was a form of practice/training. It made development smoother and easier over time as I moved on to test new systems.

Found another interesting view on this from Adam Grimes, developed over 3 posts at the links below -

https://adamhgrimes.com/no-10000-hour-rule/

https://adamhgrimes.com/building-expertise-beyond-the-10000-hours/

https://adamhgrimes.com/1000-hours-what-really-matters/

 

[CFerret]

Came to conclusion that success in trading is having an edge. I mean objective edge. Hence practice is literally not needed if you have it and won't help if you don't.

 

[ktmtrader]

Actually, nobody did. It seems highly likely that its a misconstruction of Anders Ericsson's research findings that expert-level performance of the violin required 10,000 hours of practice: he also studied top level athletes and chess grand-masters and gave them the same 10,000 hours to expert level performance.

The 10,000 hours rule was then snatched up and mis-applied to all sorts of new projects that an individual might take up, and trading is just one of these. Ericsson never studied trading.

Have a look at these for a bit more detail -

http://www.bbc.co.uk/news/magazine-26384712

Let's face it, the rule has no evidence so its just another trader myth.

Imagine believing you'll learn to trade in 20 hours...

It will take you a minimum of 10,000 hours - this actually comes from Malcolm Gladwell's research/book 'Outliers.'

That is focused trading, correcting mistakes, working on our psychology on average for 5 hours a day for 8 years.

And then maybe, if you still have a large 6 or 7 figure account by then - and most traders won't because the learning process is so steep that you lose money - you should be net positive going forward.

But trading is the hardest business in the world that I know of - and I don't know them all - and because of the fallibility of humans most will not make it.

 

[tomorton]

Imagine believing you'll learn to trade in 20 hours...

It will take you a minimum of 10,000 hours - this actually comes from Malcolm Gladwell's research/book 'Outliers.'

That is focused trading, correcting mistakes, working on our psychology on average for 5 hours a day for 8 years.

And then maybe, if you still have a large 6 or 7 figure account by then - and most traders won't because the learning process is so steep that you lose money - you should be net positive going forward.

But trading is the hardest business in the world that I know of - and I don't know them all - and because of the fallibility of humans most will not make it.

Yes, a person could be taught to trade a rigid strategy within 20 hours. But maybe accepting they must follow the strategy would take most of them 10,000 hours.