Errors of Life

H

Handle123

I know all who have overcame whether trading or their life in general made errors to become who they are. I hope others whether overcame or in process will tell what they have discovered of themselves and what it took to become profitable Life and or trading abilities so that those on the "fence" of taking the plunge might reconsider what it takes to cram years of Harvard, Brown and West Point into 10,000 hours.

My life has been a stairstep regarding trading, but some years were very very long of first step and some of them were steps going down. The bad years were emotional disasters, you really discover about yourself and all the areas of oneself you wished you never had to discover, many days of gloom and areas that you have to seek professionals cause trading bought out weaknesses that I never knew I had, I think when you keep losing in some fashion, inability to get better, body and mind revolt against what you have always considered sane, it is like you start losing concepts you once thought were important no longer are. I thought I wanted wealth from all of this considering the time it takes to understand, the time totally lost, vacations is my youth I never took and instead locked myself away back testing, girlfriends I some how misplaced as I remembered it was 8am and now phone ringing and she swearing at me cause it was 7pm and I lost track of time, parties I didn't attend cause I simple thought I was "so close". I became addicted to overcoming what I thought were losing which were really flaws in personality, and at this stage of life, I do know where they came from, parents when growing who lacked abilities themselves forced me to become the dreams they wanted for themselves, they had to have day dreamed of never making mistakes as I was taught perfection had to be performed. Hard way to live, fucks you up a life time, even now, tough to overcome when I make errors.

But in my case, that is how I became who I have became, wish I could say I enjoyed the ride, but not the case very often. My 401k is very nice size from all the time I have put into my "hobby" business, it has taught me to become a very good businessman, I can now enjoy building my life much more, but what I thought was once important, it simple is not. I don't know what level I lost concept of the value of money, but really secondary when I trade, never relied on it, always made a living doing something else and I think that is a good thing, I never used this month's rent.

By errors, I have made some very good systems, I often wonder why by error, I wonder if inventors do it by error. I have not slept in 3 days, LOL, 3 days ago I discovered a pattern, it has always been there, why do I now discover it at this time in my life, well this one not going to be discussed. Only the 3rd in 38 years, always thought I was smart enough to have dozens by now....

Got to get some sleep, these are the only times now where trading is exciting to me, continue working on it and come as close to be perfect as possible.

Have an inventive weekend all, whether raking the colorful leaves or taking kids to the zoo, take time to smell the crisp fall air, soon it be cold and maybe snowy.
 
In summary my biggest error is trusting other people and being intellectually lazy. This includes trusting so called experts.

People will frequently mislead you either intentionally or unintentionally (the fools with good intentions who don't even know what they don't know).

Never trust anyone or anything you haven't been able to verify or understand yourself. Follow this and you will save yourself a lot of trouble.
 
Two words that sum it up: Early Optimization

What, I'm not that smart I can figure it out in one year analyzing charts and working like crazy with indicators and formulas, thinking I can force understanding out from my magical brain? Isn't this how you're supposed to solve problems: work hard at it, find the solution, go to the next problem. No, didn't work cause I asked the wrong questions. I thought I could perfect it without any experience and context, and was wrong.

So I listen to friends who have tried some trading. They always get lucky and brag about their wins, which are all in the past, never in the present, or they brag about hitting the absolute low of a stock, as if that has any meaning or low-risk value. To them, trading is a game, and games you play and fool around with, to show off how good you are. I never ever hear from friends or family who lost, held onto their losers and doubled down a few times. But they all don't trade actively now. Looking for perfection where there is none. Playing games with what should be a serious business.

All the time there's someone posting on forums about what won't work. They know it all. Because they can't make it work, it has to be like that for everyone else too. 90% losers translates to 0 winning or neutral results. 1-2 years in, they've got the answers, trading is Impossible and everyone is destined to fail. With that attitude of seeing the Only Truth and Everyone Else Is Wrong, is exactly why they can't hold onto their positions and become winners, or put in the effort to get in low-risk entries. When the mind's made up, progress is done for. But misery loves company, so will invite others to join the wailing.

Companies love this stuff. They love doing for the sake of doing, as fast as possible. No concern for the consequences, the collective losses and the suffering. What you can get away with is the norm. It looks like a profitable idea, but it's not tested and confirmed properly, too much is assumed and all the incentives are against learning from experience and improving the overall goals. Even when they talk about values, it's too often just that, talk. Companies are acting like forgetful, narcissistic psychopaths and should never be treated the same as People.

Even the markets fall prey to it. Something goes up and up, becoming irresistible, and BAM! Most people are left holding the bag. What looked like the best trade ever, seems to always end in sorrow, especially for the greedy ones.

And don't get me started on marriage..

With hindsight, it's about emotional attachment to an idea, without properly validating the viability and attaining the bigger picture while delaying decisions until the time they become inevitable. When someone says, "work smarter, not harder" that's what they really mean. Easy to SAY, hard to do..
 
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I'm not saying trading is impossible. But there's a reason to why 95% of traders end up losing. If I had a 100 people and asked them to guess correction heads or tails what a coin flip would result in and keep asking them to do that repeatedly while asking the one that guess wrong to leave. I guarantee in the end I would have 5 people that guess correctly. The question is did these 5 people have skill or was it luck?

I've researched the market over the years. One of the major problems I keep encountering is that the market conditions keep changing which causes edges that depends on specific set of market condition to swing from working to not working. Now if I could figure out how to predict what market condition we are I could figure out what edge to use. I find this is a trap. A lot of guys here think that they are doing well for a month or two that it'll continue like that until the market condition changes for them and blind sided them.
 
jinxu said:
One of the major problems I keep encountering is that the market conditions keep changing which causes edges that depends on specific set of market condition to swing from working to not working. Now if I could figure out how to predict what market condition we are I could figure out what edge to use.
More...

good point, would the solution come down to having an overall strategy that is robust/adaptive across many environments?

because i think of hft and legendary discretionary traders who are outliers in generating profits over a very long period of time..
eg.1 hft - the high frequency guys whose strategy provides a robust/adaptive edge that works consistently over time. when the hft firm Virtu was doing its ipo, they disclosed that they only had 1 trading day with losses in over 6 years

eg.2 the 'legendary' japanese traders who were mentioned in bloomberg news in recent years - CIS and BNF - both guys in their mid-30s who started from $10-20k equiv USD to build fortunes of hundreds of millions USD within a decade, trading as individual entities -- doing this over a decade, growing like that, probably requires a meta-strategy that is robust/adaptive across environments
 
when I saw the title, wanted to point out that the only true wealth is your family in the end. Take time to call your family members and wish them well. Without good friends or family one is truly poor even with all the wealth in the world. You have to seriously ask yourself what is life ultimately. What will you leave behind that is memorable.
 
Trading has been a wild ride for sure! Trading does more to the emotions/ego and soul than Heroin could ever do - this is something many shrinks are very keen on. At the end of the day it's just not worth taking myself or my trading to seriously. My largest gains were a lot more luck then skill anyway. Time is the only commodity that really matters. I got into trading to reduce my work day - not to increase it. I find these days less is more. Trading has allowed me be out surfing when I want to, which was all I wanted from trading to begin with. That to me is worth more than how many zeros are at the end of my acct balances.
 
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"Mankind are so much the same, in all times and places, that history informs us of nothing new or strange in this particular. Its chief use is only to discover the constant and universal principles of human nature."
David Hume

There are some who think the market conditions change, long ago I use to think same way, you play the game long enough, you will see it happened before, before, before. I receive letters every week from traders asking for help in one way or another, and often times it is similar, many unanswered questions and way short of right questions and huge lack of stats. I don't want their stats, just want to know they have tested something out over years, but way too often systems not thoroughly back tested.

Those that get "blind sided", they never learned how to read charts, and when an unexpected move happens, your Trading Plan should already have an answer.

When you can have answers before the questions, then you have a viable Trading Plan, they are never completed as knowledge expands, always adding, and can only change after sufficient back testing.

Practice Practice Practice, I don't know how they teach multiples to kids these days, but I had to write them out for 6 weeks up to twelve, guess what- I still know them. Trading no different, you keep doing same things till you have almost no interest in trading, LOL. But you know what to do.
 
There are some who think the market conditions change, long ago I use to think same way, you play the game long enough, you will see it happened before.
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My 2 favorite trading books I often look at were written by traders of the 20's bull and the proceeding crash & recovery. People never change, hence the concepts and charts are timeless, the boom and busts play out the same - institutional accumulation, public participation, and distribution. The Fed may be able to prolong the inevitable - but that's about it.
 
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There's a concept in Catholic doctrine called the moral object.

The moral object of an action is the ultimate end to which that action is ordered towards, regardless of the actual motives of the individual, or the real-life consequences and benefits that end up resulting from the action.

I'm quite far from being an expert in the wisdom of life. But one thing I have learned is that genuine satisfaction is rarely gained unless we stop and really try to understand the long-term effects of our choices; the way we live our everyday lives.

Ever since I can remember, I've always felt different. I had a decent education, childhood friends, middle-class parents that could've done a lot worse... A relatively normal life. So this has always been more of an internal conceptualization.

But the feeling persisted and intensified as I grew. I remember being constantly baffled at how almost everyone around me seemed to get up for school or their jobs and go about a relatively routine everyday life with what appeared to be a minimal amount of effort.

It took me a great deal of effort to get out of bed every morning and stay engaged in my daily responsibilities, and I was plagued by sustained feelings of dissatisfaction, isolation, despair, lack of purpose...

I eventually dabbled with drugs like many kids do, but they were a lot more appealing to me than to most others because they seemingly provided an antidote for this ever-present dysphoria of mine.

Long story short, drugs did what they do, and I eventually found myself addicted, distant from friends and family, less productive and intelligent... powerless against my appetites... quality of life was lower than ever before.

I'd wake up feeling awful and desperate to escape that feeling regardless of the consequences; a self-sustaining cycle.

Basing our decisions on emotions and immediate-term effects is a recipe for misery. My time in active addiction was an extreme example of that, but the lesson is applicable to life in general as well as trading.

To start getting better, I had to learn to disregard the potent short-term incentives for taking drugs, and instead think about what choices like these would cause my life to look like in 10 years, 20 years, on my deathbed. The projection didn't resemble a picture that was coherent with any of my values and the things I found truly satisfying.

I've grown, and hope to continue growing in having the integrity to make choices that reflect my deepest values and desires, regardless of their cost or difficulty.

For example, I strive to make personal sacrifices, encourage, and support my wife every day, regardless of if they are well-received or even noticed; regardless of if they are reciprocated or how I've been treated recently.

I have a marriage that is immensely satisfying to me. But it isn't a matter of luck, a perfect match, or infatuation. Humility, grace, and a lot of hard work make it so. We aren't passive agents to the circumstances of our lives, or to the success of our endeavors, like trading. They are products of the thousands of little choices and sacrifices we make over the days and the years; the values and visions that we work towards.
 
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