Traders & Trading

PieterSteidelmayer

Well-known member
283 54
If you trade just to make money, or because you think you can make money by trading, the chances are you will not. If you intend to make enough to buy the yacht and the private tropical island and then retire there, the chances are almost zero that you will do any of these things.

I’ve know a lot of hugely successful traders who made many multiples of their nearest contemporary in a given year, and then they disappear. Some in a blinding flash of losses shortly thereafter or more generally through a gradual regression to mediocrity and finally shameful exit from the arena. I also know a few, far fewer than the hotshot of the year brigade, who have been trading for many years and are rather wealthy and have become so from grinding out steady profits year in, year out with the occasional home run and always, always small losses. The former bunch of bright young things tend to do it for ego, glory, fame, wealth, kudos, hubris. The latter are a quieter bunch. If they do have the yacht and the private tropical island, they don’t use them very much as even if they can trade from them, there’s too much down time getting there and back – to where the action really is. And being away from the action for any length of time feels like living death.

There’s much discussion around whether traders are born or made, or both. But this misses the point. It’s like saying do runners run because they are born to it or learn it. Or why you do Yoga or play golf. Those things we choose to do. People don’t normally do Yoga or play golf with any intent other than to do Yoga or play golf – because they enjoy it, are even passionate about it. That’s the driver – passion. If you get up in the morning and there’s one thing you’d rather be doing than anything else, your passion in life, that’s really what you should be spending your days doing if you have any hope of happiness and possibly even fame and wealth too.

When you’re not involved in doing something you are passionate about there is anger, tension, aggression, misery and failure. There’s a lot of that evident on these boards. I’m sure there’s a lot of that evident in every industry – I’m not singling out trading as the nadir of lost souls, it’s just the one in which most of us are most interested. When you’re engaged in your purpose, your passion in life, there is no effort, no obstacle, no amount of time and effort you don’t willingly spend on the craft. Late nights, weekends, skip holidays forget to eat or sleep. All done without thought or regret. If you’re not feeling that about trading then get out now and find something else to do with your time, and money.

When I am presented with the opportunity to acquire for my team either this year’s hotshot or the less well performing, but steady trader, whom I note has been in the office as late as me most nights or in at weekends or routinely skips lunch – because they love the job, my decision is already made.

So if you’re in it just for the money, save yourself the hassle. If you’re trading because you love it, rather than for what you hope it will give you, then it doesn’t matter what methods, techniques, systems, markets, asset classes and individual instruments you trade or how you trade them, you will eventually find your way- providing you can protect your capital en route.

Nobody could accuse me of being mystical yet there is a passage from Kahlil Gibran’s “The Prophet” which I have committed to memory such is the resonance it has in relation to trading and traders and I have placed it at the end of this post. But for those of challenged attention spans it basically says; If you don’t like what you’re doing as your labor in life, find something else and preferably something you love doing.

You work that you may keep pace with the earth and the soul of the earth.
For to be idle is to become a stranger unto the seasons,
and to step out of life's procession, that marches in majesty and proud submission towards the infinite.

When you work you are a flute through whose heart the whispering of the hours turns to music.
Which of you would be a reed, dumb and silent, when all else sings together in unison?

Always you have been told that work is a curse and labour a misfortune.
But I say to you that when you work you fulfil a part of earth's furthest dream, assigned to you when that dream was born,
And in keeping yourself with labour you are in truth loving life,
And to love life through labour is to be intimate with life's inmost secret.

But if you in your pain call birth an affliction and the support of the flesh a curse written upon your brow, then I answer that naught but the sweat of your brow shall wash away that which is written.

You have been told also that life is darkness, and in your weariness you echo what was said by the weary.
And I say that life is indeed darkness save when there is urge,
And all urge is blind save when there is knowledge,
And all knowledge is vain save when there is work,
And all work is empty save when there is love;
And when you work with love you bind yourself to yourself, and to one another, and to God.

And what is it to work with love?
It is to weave the cloth with threads drawn from your heart,
even as if your beloved were to wear that cloth.
It is to build a house with affection,
even as if your beloved were to dwell in that house.
It is to sow seeds with tenderness and reap the harvest with joy,
even as if your beloved were to eat the fruit.
It is to charge all things you fashion with a breath of your own spirit,
And to know that all the blessed dead
are standing about you and watching.

Often have I heard you say, as if speaking in sleep, "He who works in marble, and finds the shape of his own soul in the stone, is nobler than he who ploughs the soil.
And he who seizes the rainbow to lay it on a cloth in the likeness of man, is more than he who makes the sandals for our feet."
But I say, not in sleep but in the overwakefulness of noontide, that the wind speaks not more sweetly to the giant oaks than to the least of all the blades of grass;
And he alone is great who turns the voice of the wind into a song made sweeter by his own loving.

Work is love made visible.
And if you cannot work with love but only with distaste, it is better that you should leave your work and sit at the gate of the temple and take alms of those who work with joy.
For if you bake bread with indifference, you bake a bitter bread that feeds but half man's hunger.
And if you grudge the crushing of the grapes, your grudge distils a poison in the wine.
And if you sing though as angels, and love not the singing, you muffle man's ears to the voices of the day and the voices of the night.

 

Mr Fox

Established member
510 136
Good Morning Pieter,

Wow, what an in depth, and insightful post to start the morning, and many lessons in there that we should all take heed off, so Thank You.

However I personally would disagree on some aspects, and that again is just my personal opinion, and please excuse me if you feel I am speaking out of context.

In your example of the 2 traders the steady Eddie who works hard, and the flash harry who seems to have the more natural ability. If I was in a position to hire one I would personally go for the one with the natural ability, the reason being, for someone to be in a position to hire means you have got enough people skills, and influence that you could use your people skills, and tutelage to teach either one of them to become proficient, so why not pick the one with the natural ability, and mould him into an even better trader, after all a more successful flash Harry is a more successful business you have, although if flash Harry's attitude reeked of being a know it all, then the decision to pick steady Eddie would be much easier.

I guess every person is different, and it really does come down to a person's genetic thought process. I know people who are very successful who are motivated by greed, motivated by revenge, motivated by a goal, motivated to succeed, and the thing that seems to be a constant in all these chaps is their tenacity.

In the Uk there is a very bad social attitude towards anyone who is successful, yet go across the pond to America, and their attitude is the complete opposite.

Having something to aim for is not a bad thing whether it's to buy yourself what you want, a loved one something special, or as you say a yacht, or Island, however with having a goal, there needs to be a realistic plan, and I'm sure there's people on this forum who trade who may not even have a trade plan that's there in front of them, be it written down, or committed to memory.

Personally speaking I have been going to the gym regularly for over 15 years. I initially went as my friends did, then once there it was being competitive with my friends on who could lift more etc, yet 15 years later I'm still there, but now twice a day. Cardio in the morning before starting trading, and weights in the evening. Now some may say why do you do something that you hate, well the simple answer is to stay in shape, to keep my nice clothes still fitting me, and more importantly, when a woman compliments you on how good you look(even if it is just mother), well that's motivation on a different level.

When it comes to trading I would not call it a passion, nor is it something I hate, but I see it as a challenging, yet satisfying occupation where I have to be mentally balanced. If I hate it there's a possibility I won't do it to the best of my ability, and if I love it, well there's plenty of opportunities for heartbreak on a bad day.

I set short term goals, have long term goals, and basically get my head down, stick to a plan, and go about achieving these goals with due diligence, and hard work.

Passion without a plan, a goal, and knowledge in a specific field can be very ruinous as my gambling friend would attest to.

Best
John.
 

PieterSteidelmayer

Well-known member
283 54
If you're going to disagree may I know if you have a background in the subject - running a professional investment team at institutional level?

Define natural ability.

I said nothing about working hard. Donkeys work hard, but I wouldn't hire one - unless he was the boss' son.

That apart sir, you went off on a bit of a tangent and appear to have missed the point I was attempting to make. It's got nothing to do with a vision or a goal no matter how realistic the plan to achieve this vision or goal.
 

Mr Fox

Established member
510 136
If you're going to disagree may I know if you have a background in the subject - running a professional investment team at institutional level?

Define natural ability.

I said nothing about working hard. Donkeys work hard, but I wouldn't hire one - unless he was the boss' son.

That apart sir, you went off on a bit of a tangent and appear to have missed the point I was attempting to make. It's got nothing to do with a vision or a goal no matter how realistic the plan to achieve this vision or goal.

Good Afternoon Pieter,

My disagreeing has no basis in running a personal investment team at institutional level but, as stated was a personal opinion.
:)

Best
John.
 

DionysusToast

Legendary member
5,963 1,501
Pieter - are you in the industry yourself? If so - in what capacity?

Just interested...

I think having a passion for trading is good. Trouble is, there's people with an obsession bordering on an illness. Those people will read what you wrote and think "this guy says it's necessary to put in effort, so I'll bring out the meth and do 100 hours straight.".

We had a member on here that matter-of-factly once said he slept next to his trading machine and that he would wake up at night to check his positions. As if this was normal and not at all odd.

It takes not a small amount of dedication to actually start pulling money out of the market but after that it isn't 'exciting'.

The interesting part and what keeps me coming back personally is the challenge of the market always switching gears on you and the fact that the more you do it, the more you recognize those scenarios and the more you feel you are "getting one over" on the market so to speak. I sort of feel like "Nice try Mr Market but I think I know what it is you are up to". There is a feeling of satisfaction when that occurs and it plays out to your benefit.

Then of course, there's days where it just doesn't come at all and you get cut up.

I always remember the first time I traded Eurex with a US dollar account on IB. I started the session with a US dollar balance. I ended the session with the exact same US dollar balance AND a small Euro balance. I can't explain that feeling but it was as if I'd broken the laws of physics. As if the money literally appeared from nowhere. Silly, I know but a great feeling.
 

PieterSteidelmayer

Well-known member
283 54
I think having a passion for trading is good. Trouble is, there's people with an obsession bordering on an illness. Those people will read what you wrote and think "this guy says it's necessary to put in effort, so I'll bring out the meth and do 100 hours straight.".
That would be their business. I don't think bordering on being obsessed is such a bad thing. It is those with driving passion and unstoppable intent that bring things about and in the trading world it is never the alpha types you see in the movies that fulfill this role, it is the quiet, dedicated, focused ones. Perhaps the fault is mine in not spelling out passion alone is not enough. But without passion no skillset or earnest endeavor can ever succeed long term.

We had a member on here that matter-of-factly once said he slept next to his trading machine and that he would wake up at night to check his positions. As if this was normal and not at all odd.
He went home? Lightweight.

It takes not a small amount of dedication to actually start pulling money out of the market but after that it isn't 'exciting'.
That IS the point. The dedication has to be there in your nature, not forced, or it becomes an effort. Trading should never be exciting. It is the calm execution of superior intellect.

The interesting part and what keeps me coming back personally is the challenge of the market always switching gears on you
The markets are always changing. Human psychology does not. There are few successful professional traders using the same techniques in today's markets they were using 10 years ago. It has changed out of all recognition.
 
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Forexmospherian

Legendary member
39,928 3,301
That would be their business. I don't think bordering on being obsessed is such a bad thing. It is those with driving passion and unstoppable intent that bring things about and in the trading world it is never the alpha types you see in the movies that fulfill this role, it is the quiet, dedicated, focused ones. Perhaps the fault is mine in not spelling out passion alone is not enough. But without passion no skillset or earnest endeavor can ever succeed long term.

He went home? Lightweight.

That IS the point. The dedication has to be there in your nature, not forced, or it becomes an effort. Trading should never be exciting. It is the calm execution of superior intellect.

The markets are always changing. Human psychology does not. There are few successful professional traders using the same techniques in today's markets they were using 10 years ago. It has changed out of all recognition.


Spot on - I agree with you - which is a bit of a worry

Regards

F
 

Solas0077

Active member
236 14
The markets are always changing. Human psychology does not. There are few successful professional traders using the same techniques in today's markets they were using 10 years ago. It has changed out of all recognition.

Good point I think it is true but only in longer time frames because now intraday the robots play their own game that has changed a lot from the past.
 

DionysusToast

Legendary member
5,963 1,501
So Pieter, you aren't in the industry, right?

As such, i dont think you should be asking others for their qualifications.

Anyway, you have some interesting observations but on the topic of obsession, you are wrong. The obsessed never make money. The obsession is their downfall. They are the $5k account holders obsessed
With making a million, not the level headed guys looking to make low risk trades.
L
 

PieterSteidelmayer

Well-known member
283 54
So Pieter, you aren't in the industry, right?
Check the PM I sent you at 06:35 BST this morning.



Anyway, you have some interesting observations but on the topic of obsession, you are wrong. The obsessed never make money. The obsession is their downfall. They are the $5k account holders obsessed
With making a million, not the level headed guys looking to make low risk trades.
L
Seems a bit pointless arguing with you our respective sets of life experiences. I don't know any $5k account holders obsessed with making a million. You have the edge on me there.
 

DionysusToast

Legendary member
5,963 1,501
Check the PM I sent you at 06:35 BST this morning.

**PM REMOVED**

OK Pieter. But not the real Mr Steidlmayer are you? Or maybe you can give me the surname of Mac that used to be a runner for you.

As you are not Mr S - what you are is a fund manager hiding behind the name of a trader that is very well known in retail circles. OK - fair enough

Seems a bit pointless arguing with you our respective sets of life experiences. I don't know any $5k account holders obsessed with making a million. You have the edge on me there.

So how come you wrote this:

If you intend to make enough to buy the yacht and the private tropical island and then retire there, the chances are almost zero that you will do any of these things..

It amounts to the same thing. Small money chasing unrealistic returns. It should be discouraged and it is an obsession for many. You claim not to know about this obsession yet you describe it perfectly.

You sure are an enigma.
 
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kimo'sabby

Experienced member
1,622 287
So Pieter, you aren't in the industry, right?

As such, i dont think you should be asking others for their qualifications.

Anyway, you have some interesting observations but on the topic of obsession, you are wrong. The obsessed never make money. The obsession is their downfall. They are the $5k account holders obsessed
With making a million, not the level headed guys looking to make low risk trades.
L


Remaining psychologically detached throughout the whole discretionary daily routine, scalping on the retail side...[balls - formaldehyde - jar - museum]
 
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PieterSteidelmayer

Well-known member
283 54
DionysusToast - you have published personal information that was provided to you via PM with the implicit expectation of confidentiality. Let this be a lesson to anyone else thinking of entrusting you with similar information of your total lack of integrity.

If you compare J Peter Steidlmayer with Pieter Steidelmayer you will see apart from the different spelling of the surname, he uses his middle name which is also spelled differently.
 
 
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