Think you “can’t” be a trader?
1. Not enough time
I hear a lot of excuses from people as to why they aren’t—or can’t be—successful traders.
All of these excuses are absolutely ridiculous…
This is the most common excuse people give me. They’re busy… they have a full-time job… they just generally have less time than every other single person in the world.
First of all, each of us has the same number of hours in the day.
Secondly, I don’t know where we all got the idea that, in order to be successful as a trader, you must sit in front of the screen all day. But it’s the most preposterous, ridiculous, stupid thing I’ve ever heard in my life.
If you’re sitting in front of the computer all day, it’s likely you’re terrible at trading. You’re probably sitting in front of the computer because you’re watching the positions that aren’t going well.
The very best traders in the world aren’t the ones who sit in front of the screen all day. In fact, the best traders I know spend maybe an hour a day in the study.
2. Not smart enough
The second complaint I hear all the time is, “I’m not really good with computers,” or “I’m not really smart about this stuff.”
I was the worst student at my law school. They almost didn’t let me graduate.
The very best traders that I know were terrible students. They didn’t fit into the academic culture. If you’re trying to in front of everybody else academically, you’re going to be a terrible trader. You take things too literally. You’re trying to memorize facts and get rewarded for that memorization.
My favorite traders are smart people, but the most important quality of these individuals is that they’re “common sense” smart. They don’t have an open losing trade and then lie to themselves about how good it is. They’re always telling themselves the truth. They’re rational about the decisions they make. And they have the skill of estimation—meaning they’re able to see ahead based on the decision they’re making now.
Meanwhile, the single greatest quality of every egghead “straight As” person I’ve ever known is they couldn’t see one step in front of themselves. They couldn’t see what was going to happen tomorrow.
Think about your own kids. Do you want your kids to get straight As or do you want your kids to be the ones who everyone else looks up to because they understand how things work? How real life works.
If you want to be great at trading, you need to have common sense about your trading. Cut off your losing trades. Ride out your winning trades. Don’t take a lot of trades. Trade in smaller positions sizes.
Just have common sense.
3. Not enough money
People will say to me, “Well, I’m trading with a $50 or $100 trading account.” And my answer is always, “Where is your other money going?”
Now if you live in a third-world country, know that I love you, and I try to provide as much as I can to you for free. And maybe you do have a $200 account. Fine—we’ll make $1 and keep $1 and make $1 and keep $1 and build it up from there.
(And if you live in a third-world country, get your account hooked up to Darwin X. Prove you can trade responsibly with very small losses and very consistent small gains. You could be managing a portfolio of $500,000, even starting with a small amount of money.)
So stop making the excuse that you don’t have a lot of money. Stop saying unless you can double your $1,000 account, this isn’t going to be for you.
That’s just gambling. Go to the racetrack instead. Trading involves a substantial risk of loss. But most of the time, that’s reserved for the people who are gambling like drunken monkeys.