Learn How To Trade

[MJFinnegan87 10]

I know this isn't going to sit well with most -- especially the vendors here who like to attack me -- but one of the most important lessons I learned as a trader is that it is not possible to learn how to trade! This is why I don't claim to teach others how to trade. Something that can't be learned surely can't be taught!

 

One of the big breakthroughs I had in my performance was when I recognized that the effort in spent on learning how to trade was a mistake. In order to learn anything then it must be finite and it must be static. So, if we are to learn anything (completely) then it must be completely contained and never changing. If it changes or if we can't completely bound it (constrain) it then it is not possible to know it completely which is exactly what "learning to do something" implies.

 

Most professions are both unbounded and changing. There is no "learning how to program" either. It is not possible to learn how to program because if one truly learned how to program then it means (to me) that you can program anything in the world under any possible scenario. Nobody can do this! There are many specializations and new develops on a regular basis.

 

Let me give another example, it is not possible to, in general, "learn how to be a doctor". It only may appear that way. But, do you think the doctors of today would be able to practice medicine 200 years from now without additional training? Surely not...A good example can be found even today, I was reading some months ago that heart surgeons who had a decade of education and had expected to make 300k-500k per year were unable to find work because stints had replaced most of the work they would do. Many of these surgeons were going back to school to get additional education.

 

So, what does a trader who claims to have learned how to trade really mean? Really its not a objective measure but a measure ones own self confidence. A measure of how competent they feel and capable.

 

Let me back up and also say that I have produced materials on developing specific types of skills that have helped me. There are specific types of skills that one can develop, and that can take off years from the learning process.

 

The psychology that the average trader has, and promoted by average vendors, is so much different then the psychology that I believe the elite performer embraces. My psychology is one of a process. It is not a learned but a learning.

 

Instead of focusing the idea of "learning how to trade": focus on taking great opportunities. Focus on the process. Focus on listening to the market. Focus on building skills.

 

As well, there is no single way to trade. I trade in multiple paradigms, on multiple levels..

 

As I encouraged my students in my newsletter, focus on the opportunity.. focus on the process..

 

If I think about "learning how to trade", I draw a blank but I know how to find opportunity in the markets on a regular basis.

---

Blog - The Market Predictor

 

I agree with your assertion at least for the reason that: in many other proffessions, there exists one or occasionally a few, optimal solutions that yield a positive outcome with the highest chance of success. In trading, there is no optimal way for EVERYONE to trade an optimal strategy, such that eveyone can be profitable simulataneously. Trading is competition in its purest form, and it is not possible for everyone to outperform everyone else. The people who win this competition, are only able to do so at the expense of those who lose. Not everyone can be the winner of a zero-sum game(negative after comissions), and no strategy can be created or taught to disprove this.

 

I make money because I can consistently take money from a subset of traders in the entire market that I know I can outperform because I know my advantage over them.

[Qiman 10]

I decided to check into this thread, seeing as it was so popular.

 

What it most reminded me of was my teenage years reading Mad Magazine, thanks for the laughs many of you! The never-ending journey through the realms of human interaction. Not much has changed over the eons in that realm at least.

 

I think what Predictor was trying to articulate is that the markets can be incredibly dynamic, and what might work for months at a time might not be so lucrative when conditions change, due to new algos, volume crashes, changes in federal policies, etc., etc. In so many fields now one must be very adaptable and proactive to stay ahead of the curve.

 

Look at how some auto mechanics could not adapt to the computerization of their field, as just one example. The days of the backyard mechanic who just used wrenches are long gone.

 

With trading, I do indeed find the principle of balance and imbalance to be key. Will that someday change? I don't know, but it seems to me that it will always be a fundamental concept, one that requires the development of much skill to utilize in real time.

 

On another note hit upon in this thread, the whole concept of Professionalism is indeed interesting, as ZDO so well stated. I earned two professional graduate degrees, they required much time and financial energy to acquire. Some of what was learned was useful, but some of it does not work so well in the real, very dynamic world we live in. And indeed "professionalism" can be over-rated when licensing laws interfere with the free market, and alternative ways of doing things, as with health.

 

About the only thing I really know, is that all of us understand relatively very little about everything and anything, compared to what there is to comprehend. I currently teach cutting-edge wilderness survival skills, and my classes have made a huge impact on some pretty experienced and skilled people. And yet it absolutely overwhelms me that there is one level after another of deeper understanding and skill waiting for me to comprehend and Master. I am basically like a child groping in the dark at 53 years old. But it is just as well, for I never want the Journey of exploration and discovery to end!

[Ingot54 13]

So ... Predictor ... you were saying ... before the thread was hijacked by the patronising and insecure one, who feels threatened by the discussion.

 

I want to get into a discussion - not engage some infantile tit-for-tat-I-can-piss-over-walls self-proclaimed genius who is a hero in his bathroom mirror.

 

I dunno why he gets oxygen, to be candid. The thread's been pissed on.

 

Can we address the OP's topic please, and not follow the agenda of some trading stud who wonders if he can still get it up, after his personality bypass surgery?

 

And hurry please ... my nurse is on his way!

 

[4EverMaAT 10]

If the OP was trying to say (to some degree) that you cannot know everything there is to know about the market with words, with symbols, then I concur. The greatest inspirations usually come from unknowing and unlearning what you observe does not work. Then when you see something that does work, you 'know' it works from experience, not just because someone said so.

 

It is difficult to follow or observe something abstract. You would need to develop or follow concrete steps, preferably a system that has a continuous cycle of the same core steps to test the validity of the steps. But when the OP makes a statement like

 

"...So, what does a trader who claims to have learned how to trade really mean? Really its not a objective measure but a measure ones own self confidence. A measure of how competent they feel and capable.

 

Let me back up and also say that I have produced materials on developing specific types of skills that have helped me. There are specific types of skills that one can develop, and that can take off years from the learning process..."

 

What are these objective skills or steps that the OP refers to?

[SunTrader 10]

This thread is predictable. The markets aren't.

 

But then you don't have to predict to win. In fact it gets in the way of winning.

 

Leave that to the 90 percenters or those who can teach but can't be taught. Huh?

 

Doctors who aren't doctors etc etc. :doh:

[onesmith 10]

[ame=http://www.youtube.com/watch?v=Uq-FOOQ1TpE]TEDxTeen - Jacob Barnett: Forget What You Know - YouTube[/ame]

[onesmith 10]

[zdo 20]

Thanks to some of the new guys for pulling this back on topic from Post #27 forward.

 

I’m thinking the distinction we’re working with in this thread is that 'parts' of our brains can be trained but not programmed and some of it can be programmed but not trained. The fight broke out when the OP wanted to discuss the first and so he ‘neglected’ the other side which is obviously precious to those who are more dominant in or emphasize the second.

 

The link below contains a potential exercise for each of us in exploring what is possible for us to “learn” and what is possible for us to “train”. On the surface it most fits into what Steve46 has been talking about lately, but a little bit of neutral curiosity can provide some explosive insights into what Predictor is talking about too.

 

A Primer To Intraday Market Moves | ZeroHedge

 

Having been in this business a long time it reminded me how traders used to get a contact high off Larry William’s trainings, but very few really listened to what he was saying …and the key element his students most neglected were the almost EXACTLY same statistical studies which drew out the prevailing daily tendencies of those days!

 

 

...(chapters and chapters... then...)

 

 

 

Necessarily short and oversimplified but - The threshold from surviving ( as in to learn and “practice one or two basic setups hundreds of times” KOMODO) to thriving is in training to know, in the moment, if and how those statistical tendencies are working (or not) that particular day. (or even more dastardly, that part of a particular day )..

ie (and OP can correct me if I'm off here, but) - ---"learning" not enough.

 

... (chapters and chapters... then...)

 

...a related way of getting at this is practical understanding of the differences between "judging" and "judgement". The first is learned. The second has no need at all to be 'learned' - the only 'learning' needed is for the first to 'learn' how to get out of the way of the second.

Edited August 8, 2012 by zdo
(slightly more) readability ;)

[BlueHorseshoe 10]

I’m thinking the distinction we’re working with in this thread is that 'parts' of our brains can be trained but not programmed and some of it can be programmed but not trained.

 

Hi zdo,

 

Thanks for an interesting post.

 

Would you be willing to expand a little on the distinction you're making between programming and training?

 

Cheers,

 

BlueHorseshoe

[Yorkid 10]

I think you guys are over analysing this.

 

I learned to drive. Does this mean I have to drive the same car for the rest of my life? Does it mean I have to confine my driving to the same roads I took up until the point at which I passed my driving test?

 

So, what does it really mean to say that I've "learned to drive a car"?

 

The claim "I can drive" doesn't exclude the fact that there might be better drivers that I am, just as the phrase "I've learned to trade" doesn't exclude the possibility that there might be better traders than I am.

However, the process of trading carries with it the hidden meaning that the skill of each is pitted against the skills of the rest. This is not so with the skill of driving (though some people seem to drive as though it were). Driving is a cooperative enterprise in the success of its outcome (its "process" as it goes on from day to day) - which is to say that the overwhelming number of participants achieve their goal (arrive safely). Trading is also a cooperative enterprise in the success of its outcome (its "process" as it goes on from day to day) - which is to say that the overwhelming number of participants do not achieve their goal (make a profit).

 

[student] So, Mr Teacher (whoever you are), what is it you really have to offer me (your humble student)?

[Teacher] Assuming that you have a certain degree of numeracy and technical competence (otherwise you wouldn't be talking to me), as your mentor I offer you hope and fellowship in the face of adversity and the ultimate impossibility of documentary completeness.

[Pauses for thought]

[Teacher] Oh, yes, and the fact that your enemy is the rest of the class.

 

So, if you want to "learn how to trade", by which I take it you mean you want to learn how to be a successful trader, then look for transferrable skills in places that fit the profile of the successful trader. But where would the good traders be without all the bad ones? By the law of averages, at least some of those bad traders must end up becoming teachers. Those who can trade, and those who can't trade teach, thus ensuring the viability of the "process".

[rplust 10]

I guess the great teacher does not take any answer except "yes sir!"....lol.....but if he was such a knows trader he'd neither have the time to teach nor to post here because he'd be busy counting the money. I chose this sarcastic introduction because I remember my initial efforts a few years back that I thought to be successful I'd need to learn the trade and of course who were the best to learn from.... well, those great gurus who I thought knew everything. To make it short, the internet is full of those (most of them I'm sure failed making a living by placing there own trades) and of course there are thousand indicators out there which will tell you where the price will go the next minute and more of this BS.:crap: Sick and tired I soon decided to return to the basics by just drawing a line at every round number i.e. 00, 25, 50, 75,...( last 2 digits} you can observe that the price, thriving for balance will respect those levels most of the time. Or you could use pivots. Anything that visually indicates S/R levels if you can't see them on a naked chart. If you are also aware how institutions trade i.e. they will take out your stops first sitting below those levels then you can actually trade safely. The rest is observation and anticipation. The market is hardly random i.e. history repeats itself. This is how I trade, it makes fun and money and thus I agree with the Predictor. There is really not much to learn and definitely no need to spend thousands of Dollars for those "know everything" teachers.

Price moves either up or down (well, isn't that great news!) and turns around when it runs out of gas (supply or demand) you just need to see where. Don't tell me there is anybody out there who could not do that! I will take his money:haha:

[AdamG 10]

Interesting discussion and quite a diverse field of characters. Many frames of reference and varied range of experience.

My first response is that I believe trading at a high level (consistent high returns - outlier) is a combination of art and science. I do not think that you can teach someone to be a great artist. You can teach him (her) the tools and some techniques and he may become a good artist but it is something in him that makes him great.

I just want to be good. If 'great ' happens - that's great.

You can teach market history, tech analysis, fundamentals, money management, probabilities, etc but I would venture to say that it is debatable that discipline can be taught successfully.

What do I perceive to be the 'Holy Grail' regarding day trading?

 

Your next trade has a 50/50 chance of being right.

 

If your probability is 60/40 (quite optimistic) and you work with an advantageous risk/reward strategy then you will do well if you have the discipline.

 

I content that everything can be taught up until 'discipline' or when hormones kick in

[zdo 20]

...Would you be willing to expand a little on the distinction you're making between programming and training?

 

…missed seeing your question earlier… thought this thread had gone inert… will make an attempt … wish you had asked everyone so that someone who ‘knows’ could really explain it …

 

I think we’re bumping up against the limits of language – even busting out in poem wouldn’t really help… “answers” to such questions are best found ‘inside’ your own life…etc etc… here goes nothing…

 

“Two distinctly different brains coexist inside our head. Each processes information quite independently from the other, and each uses a distinctly separate processing language. Each looks at the world from a different point of view. Each brain accumulates and stores a different memory of the same experience.”

 

sequential-----------------------------------------synthesizing

 

deductive------------------------------------------inductive

 

‘disassembles’ wholes into parts--------assembles parts into wholes

 

exhibits a separating influence-----------exhibits an integrating influence

 

guided largely by ’tangible goals’--------guided by ‘intangible purposes’

 

categorizes objectively----------------------discrerns subjectively

 

gathers and stores data--------------------transforms data into ‘wisdom’

 

can be programmed-------------------------can be trained

 

activated by “flaw-finding”------------------activated by “value-finding

 

or “What’s wrong?” questions------------or “What’s right?” questions

 

 

 

more re limits of language, etc. Like yur orkid just said - “I think you guys are over analysing this”. It’s really not productive, but our tendency when seeing side by side stacks like this is to go further into separate, compare, and contrast mode… so

“what does what?” is far less of an important question than “how do they complement each other and work together even better ?” As a friend, I will just bluntly tell you – reading all this and the fkn accompanying incomplete list, etc will not get you much closer to ‘understanding’ these brains or making them more ‘accessible’ to you !! …

 

“… the two functions must work together as a team …what clues do you get from the table’s comparisons about how this partnership can best occur? For me, the most telling comparison looks at programmable versus trainable. A computer chip is programmable.” Horses, which have almost pure synthesizing functions in both hemispheres of its brains, are only trainable. If horses had significantly more developed sequential ‘brain’ networks, we would attempt to program them to win races while they were “standing in the paddock., much like we attempt to program our children in school …”

 

...not further going into it here, but it should be noted that those “two distinctly different brains” are not the only essential ‘brains’ in the first body...

 

and just for snicks ... let’s note some of the words that I didn’t utilize. I have COMPLETELY recused from service two of our main and typical ‘collective paradigm’ words connected to this subject – analytical and intuitive…. took them out because they are now, in a word, misleading…

Also, note the absence of relying very much on brain hemispheric references … historically emblematic but now also misleading. However - one notable point around the left / right brain business is that brain development leaning ‘feminine’ tends to produce cooperative cohesiveness between these ‘brains’ and less specialization… while ‘masculine’ brain development tends to produce expertise / specializations and lower communication / cooperation / access bandwidth between the two ‘brains’.

…One other word, a big ape in the room that really needs to be mentioned / included, but isn’t = ego. :rofl:

 

Acknowledgements and references: All quotes herein and the stacks (which I abbreviated) are from Kurt Wright, my 'thinking' coach in another lifetime…

 

hth and have a great weekend all

 

zdo