db is quite the proponent of the
Zen thread. He suggested I read/study the first 43 poker rules. Well, 43 is a bit for me to chew right off the bat, so I figured I'd start with the first 10.
POKER RULE #1: Learn to use inaction as a weapon.
I think the first POKER RULE # 1 "Learn to use inaction as a weapon" is absolutely utmost important to traders' survival. That is why it is rule #1. Most of the time, market is indeed random, one can only win consistently by avoiding activity most of the time and trade only the few times during the day when a high probability trade occurs. It is our job as a trader to wait more than we trade.
POKER RULE #2: Don't get irritated or angered by long session of folding.
We are all playing probability over a long run. Understand it. Accept it. Mentally prepare for it. Keeping our head makes all the difference. It is on the top of my list.
POKER RULE #3: If you've been folding a lot, for a long time in the game, and you're starting to think that maybe it's time you got in and played a few hands again -- that's not a good enough reason. Keep folding.
Don't worry too much about missing a play. Any one-trade sequence is not supposed to make or break our trading career. But not waiting for the high probability setup will put us against the law of large number, which is ALL WE HAVE - then we are really all alone in Vegas.
POKER RULE #4: Don't feel like a martyr when folding.
Don't start feeling self-righteous about all this folding you are doing... as if now it owes you (because you've been so good, so disciplined, so patient...). This is a trap... As you keep folding, you must feel neutral about it.
Whether you have been waiting for 5 min, 1 hr, half a day has no bearing to what is happening NOW. This is again - keeping our head and stick with the plan.
POKER RULE#5: Sometimes others get to play and you don't... But the most important thing is this: you must be comfortable with this - welcome it. Make peace with this idea. Cross your arms and sit back.
It is getting silly trying to catch every swing or worry about missing a move. There are thousands of markets out there and we are missing a play ALL THE TIME. The objective is executing the business plan with precision over a long run. Precision = Speed. Marginal trade will only bring chaos into the statistical equation.
POKER RULE#6: To win at poker you must embrace the idea of breaking even... A distaste for breaking even can lead us into the valley of pressing and overplaying and other wrongful activity.
We have to have a positive mindset for the long run. But one-sided expectation for a short performance interval is just going to chew us up. Breaking even or a loss is just one of the natural outcomes in a statistical run. This is the way our trading plan supposed to work given the nature of the game... it is not broken. The reason we have a plan in place is to help us focus on executing sound decisions under fire. Do not make it difficult by outsmarting our own plan. Pressing at the last hour to meet some number in our head is just out of place.
POKER RULE#7: Regard patience as a central pillar of your game and strategy... Don't assign it a secondary or lesser role...
Mark Weinstein interviewed in Market Wizards by Jack Schwager:
"Although the cheetah is the fastest animal in the world and can catch any animal on the plains, it will wait until it is absolutely sure it can catch its prey. It may hide in the bush for a week waiting for just the right moment. It will wait for a baby antelope, and not just any baby antelope, but preferably one that is also sick or lame. Only then, when there is no chance it can lose its prey, does it attack. That, to me, is the epitome of professional trading."
If by any chance that cheetah misses its prey, it doesn't deviate from the plan and starts picking any fight. It sticks with a strategy thatâs been tested for million years of evolution or we won't see that cheetah for long.
POKER RULE #8: Keep plugging away. Expect nothing...
There will be times when you play tight, keep playing tight, and keep on playing tight, and it still does no good... the bad cards just keep coming... You may have to just keep doing it until the end, with no reward at all.
When there is no expectation, there is no fear of the outcome.
POKER RULE #9: Don't fall into the "Now Trap."... Players want to win now, today. Results must happen now, in this hand, the one right in front of us... We assign a little more importance to where we are. We make it bigger, more important... But we do this time wise too - we assign things more importance because they are happening in the present moment... Yet giving greater importance to the present in the game of poker allows us to imagine marginal hands into good hands and good hands into great hands.
POKER RULE #10: The long run is longer than you think... Playing only the best hands can be frustrating... Anger and irritability can arise. The emotions can be severely tested. This is where Zen comes in.
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