Is all discipline not the same?

[Joe Ross]

"Hey Joe! I gave up my engineering career to try my hand at trading. Now I’m in trouble. I guess the discipline needed for engineering is quite different from that needed for trading. Would you agree that all discipline is not the same?"

Brother, you have spoken the truth. The discipline required for successful trading is quite different from that needed in the sciences, engineering or mathematics. Rarely do any of us grow up learning how to operate in an arena that allows for complete freedom of creative expression, with no external structure to restrict it in any way. However, trading comes very close to being that kind of environment. In the trading environment, you have to make up your own rules and then have the discipline to abide by them—for as long as they work—and then the discipline to change them when you see them not working. The problem is that price movement is fluid, always in motion, quite unlike the highly structured events that most of us are accustomed to. In the market environment, the decisions that confront you are as endless as the price movements of which you are trying to take advantage. You are faced with the decision to participate, the decision of when to enter, the decision of how long to stay in, and deciding under what conditions you will get out. There is no beginning, middle, or end—only what you create in your own mind.

Joe Ross

 

[RUDEBOY]

Good call!

 

[nine]

Not only are they different Joe but they change with different time scales.

I am a rock when it comes to end of day discipline but when I moved to 1,3 and 5 minute charts I was a blancmange. Discipline flew out the window. After a year I was reasonable but even now, 18 months down the track I still struggle to be 100% on discipline.

I wonder whether discipline, rather than any issue in the markets is the main reason people have difficulty with, and then scoff at, day trading.

 

[SOCRATES]

"Hey Joe! I gave up my engineering career to try my hand at trading. Now I’m in trouble. I guess the discipline needed for engineering is quite different from that needed for trading. Would you agree that all discipline is not the same?"

Brother, you have spoken the truth. The discipline required for successful trading is quite different from that needed in the sciences, engineering or mathematics. Rarely do any of us grow up learning how to operate in an arena that allows for complete freedom of creative expression, with no external structure to restrict it in any way. However, trading comes very close to being that kind of environment. In the trading environment, you have to make up your own rules and then have the discipline to abide by them—for as long as they work—and then the discipline to change them when you see them not working. The problem is that price movement is fluid, always in motion, quite unlike the highly structured events that most of us are accustomed to. In the market environment, the decisions that confront you are as endless as the price movements of which you are trying to take advantage. You are faced with the decision to participate, the decision of when to enter, the decision of how long to stay in, and deciding under what conditions you will get out. There is no beginning, middle, or end—only what you create in your own mind.

Joe Ross

The problem is not that price movement is fluid, it is that price movement frequently delivers an information shock for which the individual is not prepared. There are three additional problems to make this worse. The first is that money has emotions attached to it for many people, therefore the engine that drives their interest is the wrong one, since emotions have the ability to disable reason. The second is that you cannot make your own rules as you say, you have to abide by the rules of the market itself, which delivers its verdict even before the trial is heard, and this is a shock for most ordinary people not prepared for this. It is further exacerbated by what I describe in my previous comment, above. Thirdly, discipline is of no use to anyone who does not fully understand what this is all about, it just is discipline for discipline's sake. This pill is such a bitter one to swallow that most people cannot even consider it let alone be expected to do it, this is because their knowledge is not that deep, because you must admit that what most ordinary people know about all this, can be written on the back of a postage stamp with space stlill left over.

 

[fridayeve]

When to Enter and when to Abstain

"Hey Joe! I gave up my engineering career to try my hand at trading. Now I’m in trouble. I guess the discipline needed for engineering is quite different from that needed for trading. Would you agree that all discipline is not the same?"

Brother, you have spoken the truth. The discipline required for successful trading is quite different from that needed in the sciences, engineering or mathematics. Rarely do any of us grow up learning how to operate in an arena that allows for complete freedom of creative expression, with no external structure to restrict it in any way. However, trading comes very close to being that kind of environment. In the trading environment, you have to make up your own rules and then have the discipline to abide by them—for as long as they work—and then the discipline to change them when you see them not working. The problem is that price movement is fluid, always in motion, quite unlike the highly structured events that most of us are accustomed to. In the market environment, the decisions that confront you are as endless as the price movements of which you are trying to take advantage. You are faced with the decision to participate, the decision of when to enter, the decision of how long to stay in, and deciding under what conditions you will get out. There is no beginning, middle, or end—only what you create in your own mind.

Joe Ross

Without wishing to pour water on your theory, if that is what it is, I would like to offer my view on this idea that there are so many continuous decisions to be made when trading . In reality there is only the one decision to be made "to be or not to be" in the market trading at any given time. That is to say that all the other decisions are made before you enter the market, so you see there are not loads of decisions to be made when "in " because any trader worth his sort has made all those long before getting involved. So take the pressure off those brain cells and have a cup of tea.

 

[nine]

I am tempted not to say anything but ... what the hell ... in for a penny.

Socrates, your humility is wonderful to behold. A couple of points.

You can make your own rules and most of us mere mortals would be wise to do so. Those rules are the rules for how we will participate profitably in the markets movements. They do not dictate the markets behaviour but our own behaviour in our attempt to extract income from the market's behaviours. The rules construction is likely to include the underlying assumptions that the market is statistical in nature, that you can't be sure of what it will do next, and that by following them you can change your emotional relationship with trading.

Assuming that by "discipline is of no use to anyone who does not fully understand what this is all about" you are implying some semi-mystical super knowledge then this is hardly needed. All that is required is a repeatable edge (see db's definition in the "edge thread") and a set of rules that help one to take advantage of it .... and the discipline to follow the rules of course.

 

[SOCRATES]

I am tempted not to say anything but ... what the hell ... in for a penny.

Socrates, your humility is wonderful to behold. A couple of points.

You can make your own rules and most of us mere mortals would be wise to do so. Those rules are the rules for how we will participate profitably in the markets movements. They do not dictate the markets behaviour but our own behaviour in our attempt to extract income from the market's behaviours. The rules construction is likely to include the underlying assumptions that the market is statistical in nature, that you can't be sure of what it will do next, and that by following them you can change your emotional relationship with trading.

Assuming that by "discipline is of no use to anyone who does not fully understand what this is all about" you are implying some semi-mystical super knowledge then this is hardly needed. All that is required is a repeatable edge (see db's definition in the "edge thread") and a set of rules that help one to take advantage of it .... and the discipline to follow the rules of course.

If you know what you are doing in all this, you are doing what you are doing.

Those who don't know in reality what they are doing, are gambling.

As for DB's definition, personally, I am not going to rate it.

An edge is much more than he argues it is, according to his frame of reference.

I brought up the discussion with him the other day to test the depth of his store of knowledge in this regard.

I now know what the depth is, and I am satisfied. <G>.

My curiosity is satisfied, rather. <G>

 

[dbphoenix]

Without wishing to pour water on your theory, if that is what it is, I would like to offer my view on this idea that there are so many continuous decisions to be made when trading . In reality there is only the one decision to be made "to be or not to be" in the market trading at any given time. That is to say that all the other decisions are made before you enter the market, so you see there are not loads of decisions to be made when "in " because any trader worth his sort has made all those long before getting involved. So take the pressure off those brain cells and have a cup of tea.

I think I'm in love . . .

 

[RUDEBOY]

Discipline, discipline isnt a chapter in a book you just flick to and just peruse over with your bi-focals? No!...Besides, discipline for what? Discipline for a winning method....thats easy....too easy. A method should be flexible to accomadate all market conditions, in fact, why trade method, why not trade market conditions anyway? An 'open mind method' would coincide better than an absolute, because nothing is absolute( only in hindsight). Sounds rubbish, probably is?

 

[SOCRATES]

No, It is very far from being rubbish, because you are alarmingly right. It is a method that embraces the idea you should be flexible and accomodate market conditions, whereas it is a system that is inflexible, because that is all it is., well, just inert, until something is done with it.

 

[donaldduke]

"Hey Joe! I gave up my engineering career to try my hand at trading. Now I’m in trouble. I guess the discipline needed for engineering is quite different from that needed for trading. Would you agree that all discipline is not the same?"

Brother, you have spoken the truth. The discipline required for successful trading is quite different from that needed in the sciences, engineering or mathematics. Rarely do any of us grow up learning how to operate in an arena that allows for complete freedom of creative expression, with no external structure to restrict it in any way. However, trading comes very close to being that kind of environment. In the trading environment, you have to make up your own rules and then have the discipline to abide by them—for as long as they work—and then the discipline to change them when you see them not working. The problem is that price movement is fluid, always in motion, quite unlike the highly structured events that most of us are accustomed to. In the market environment, the decisions that confront you are as endless as the price movements of which you are trying to take advantage. You are faced with the decision to participate, the decision of when to enter, the decision of how long to stay in, and deciding under what conditions you will get out. There is no beginning, middle, or end—only what you create in your own mind.

Joe Ross

Perhaps you should change your nick to Mark Douglas.

 

[dbphoenix]

Perhaps you should change your nick to Mark Douglas.

Actually, Wyckoff pre-dates all of this by 70 years +/-, virtually word for word . . .

 

[chump]

don't see why we have to get so esoteric about an issue that is really very simple...discipline regardless of it's sphere of application is simply the ability to subordinate what you think you want to a lower priority to that which you actually know you really need in order to achieve some desired outcome...ask any athlete who knows he has to roll out of bed at 5.30am to train when he would much rather stay where he is etc ..much more interesting debate is how that ability is acquired if it is acquired at all...

 

[dbphoenix]

much more interesting debate is how that ability is acquired if it is acquired at all...

True, and I took part in one but don't remember where. I'll try to find it.

I don't know that I'd use the word "ability", tho. It stems largely from confidence in the plan, and I've already posted enough about trading plans.

 

[swingtrader77]

discipline

chump
not so sure that its necessarily being mentioned because its a "simple issue"

The point here is really to re-emphasise its importance as being the cornerstone of any good trading strategy

We all have divergences from adopting a disciplined trading approach to differing degrees and need to understand and have its importance re-iterated. I am no different in this respect and reading books on say the Psychology of Trading is something I would highly recommend. I have done it and its almost like an injection. Soon the medicine wears off and I need another injection

Discipline in trading is trading and following a set proven strategy (via back-testing if you are using a black box system) with the right stake at the right time and accepting that sometimes the strategy will lose but in the long term will provide positive returns

Something I read that I found very important is that "Successful trading = following a disciplined trading approach. Financial gains are to some degree secondary". When prioritised this way, I find it easier to follow my roadmap

Good Luck
VN

 

[dbphoenix]

Found it already. Amazing. Maybe Search and I are finally becoming friends . . .

http://www.trade2win.com/boards/showpost.php?p=163440

 

[thedunce]

"Hey Joe! I gave up my engineering career to try my hand at trading. Now I’m in trouble. I guess the discipline needed for engineering is quite different from that needed for trading. Would you agree that all discipline is not the same?"

Brother, you have spoken the truth.

[ ... ]

Your Profile says that you are a Veteran Stock Operator who is an Author and Tutor. Surely with this wealth of experience it would have been prudent of you to have advised and briefed your Brother regarding this Profession before he quit his Engineering Job? It would have saved you the bother of creating a Thread.

 

[SOCRATES]

Actually, Wyckoff pre-dates all of this by 70 years +/-, virtually word for word . . .

No he did not. You ought not to say such nonsense to confuse everybody just for the sake of making a post.

You remind me of one idiot at a conference of 2000 investors and traders, in Wembley, two or three years ago, all stripes and braces by the way, who recounted how he was supposed to have met JP Morgan in a lift and asked him what the market would do that day, to which the grand old man replied that it was going to fluctuate, for certain...No one dared to challenge except me.

The true story is that there was a lift boy working one of the lifts in the JP Morgan building in Wall Street, around the 1920s. This young fellow was very keen on the market and had accumulated a small portfolio of securities. He was looking for an opportunity to have a word with the great man himself. One morning he had his opportunity. The lift was empty and JP got into it. When the doors were shut the lift boy ventured to ask "Mr Morgan please, I have a small portfolio of stocks, can you tell me please whether in your opinion the market is going to go up, or down today?". JP pondered for a minute and then brusquely replied "Well, it is going to fluctuate, that's for certain". The lift doors opened and he swept out to his office without another word. This story is documented in the biography of JP Morgan and published in paperback by Wiley.

You ought to be careful of making unsubstantiated pronouncements of this kind, they are very annoying to those of us very familiar with all of this, and very confusing to newbies and the uninformed and the vulnerable and the gullible.

 

[dbphoenix]

No he did not. You ought not to say such nonsense to confuse everybody just for the sake of making a post.

Actually, he does, though what Morgan has to do with anything of this is unclear. Perhaps you saw "Wyckoff" and thought "Morgan".

Livermore, incidentally, said much the same thing. You remember Livermore, don't you?

 

[SOCRATES]

Where does Wykoff actually say such a thing ?

And when or where did Jesse Livermore ever say you ought to change your nick ?