If trading is all about rules then why does it take so long to master?

[mathsfreak]

I have read the analogy of a pro footballer passing on their skills and how it wont make their students pro footballers and how it is often applied to trading. But if trading is all about sticking to rules and being disciplined then if you can find a system that you know really works well then why does it take years to make money?
I know it can take a while to develop and test a system and that spotting S and R lines is a skill but to me trading seems very automated.
If this is true then why does it take so long to master?

 

[Atilla]

I have read the analogy of a pro footballer passing on their skills and how it wont make their students pro footballers and how it is often applied to trading. But if trading is all about sticking to rules and being disciplined then if you can find a system that you know really works well then why does it take years to make money?
I know it can take a while to develop and test a system and that spotting S and R lines is a skill but to me trading seems very automated.
If this is true then why does it take so long to master?

If trading is all about rules then why does it take so long to master?

The legal profession should be up your street then. Considered become a lawyer or barrister? I'm sure you'll be a lot richer than most (90%) of losing traders.:cheesy:


On a serious note have you ever broken anyones rules?

On an even more serious note the worst rules to break are your own ones!

Put £1000 into a trading account and start and you'll soon savour the experience.

Really tough question my friend as volumes been written by many on this web site about the psychology of trading.

Good luck in your quest and I'd appreciate if you let me know your findings and conclusions.

 

[timsk]

I have read the analogy of a pro footballer passing on their skills and how it wont make their students pro footballers and how it is often applied to trading. But if trading is all about sticking to rules and being disciplined then if you can find a system that you know really works well then why does it take years to make money?
I know it can take a while to develop and test a system and that spotting S and R lines is a skill but to me trading seems very automated.
If this is true then why does it take so long to master?

Hi mathsfreak,
The answer to your question - well, my answer anyway - comes in three parts:
1) It doesn't have to take that long to master.
Sadly, I'm not referring to myself when I say this, but I'm pretty sure it's the case. All those graduates fresh out of uni' clutching first class honours in everything, get snapped up by the city institutions and are expected to go from a standing start to generating handsome profits in a matter of months - or so I believe. The difference is that they are pro's in the making and most of us are retail traders starting from scratch on a part time basis after a hard day's graft doing the day job. Obviously, the latter route ain't as quick.
2) There are few firm trading facts.
Loads of cliches, but few firm, solid money making facts. Spend just a few hours on T2W or any other trading related site and you'll quickly conclude that there are as many different opinions about the markets and how to trade them as there people to express them. It has to be this way, because if all market participants were of the same view, the market would soon collapse. As retail traders, our task is to try and work out what is right for each of us; who and what makes sense and somehow build a trading strategy out of the knowledge and ideas sourced from books, the internet and, in some very exceptional cases, original thought. The uni' graduate doesn't have this problem. S/he is told what to do and when to do it. Some brave folk (not me!) even go so far as to say that they are discouraged from doing too much thinking for themselves. Not that they're not extremely bright people (forgive the double negative) but, for the most part, they need to be sheep and not shepherds. By contrast, the retail trader does need to be a bit of a shepherd, lest s/he be led down one blind ally after another.
3) Lastly, the ol' chestnut about discipline which you yourself mentioned. There are an abundance of free systems out there which can be utilised to make money. The problem is that very few people can trade someone else's system profitably. I'll leave it to the psychologists to explain why. The Turtle Trading System is a famous example. Attached is a pdf available for free on the internet. Anyone can download it and, if they trade it with discipline, they ought to make money. Yet very very few people even try - let alone succeed. You gotta ask the question: WHY DO THEY FAIL???
Tim.

 

[timsk]

To help answer the question - from page 3 of the pdf . . .

 

[nine]

Consider how well people do following new year's resolutions.

Consider how much people change after going to an inspiring presentation.

 

[Trdr]

mathsfreak, you state a presumption that "a system that you know really works well"
which you then question by your 'How stable is any system?' thread

Rule # 1: PriceTime Movement is IRREGULAR

since PTM is irregular, those times a 'really works well' system doesn't 'work' may be
the occasions when losses are so large they substantially reduce prior profits
in both for example 'gut feeling vs. analysis' : http://www.trade2win.com/boards/showthread.php?t=25104
and 'The exit of a trade: how? when? where?': http://www.trade2win.com/boards/showthread.php?t=25049
entering the trader's equation is 'discretion' — individual user input

comes the question of when next will the 'really works well' system not work
will the trader sit too long before exiting a losing trade with a now large loss — discretion
not trade the next signal by second-guessing the system — discretion and
the 'emotion' of it all
should the individual be trying to Day/scalp trade ? trade D-t-Ds/Ds-t-Ws/Ws-t-Ms ? or
not trade at all and employ/deposit funds with a professional
more times the market is entered/traded = more potential losses
greater the number of self-defeating actions/losses affect emotion and capital and the
trader must keep 'beginning again' until profitable, trading is not "very automated"

rules are fixed, too many = statis or, whipsaws, the PMT is Irregular

many, most ? all ? traders usually after gaining sufficient experience ie loosing enough
times/money but continuing to learn, develop sufficient discretion to become profitable

a pro footballer is a poor analogy, golf would be better, more universal — everyone can
learn to draw: http://www.drawright.com/

 

[elsaQ]

If trading is all about rules then why does it take so long to master?

I believe that the start of the answer is HIDDEN in your question. I refer to the part that asks "why IT takes so long to master?".

You see, in my humble opinion, the markets aren't the issue, we are. Its ourselves that take so long to master and everything about trading from forums like this, the brokers, software packages and most of all, the many indicators available, divert our attention and energies from this simple truth:

The answer is in US.