Trading and Athletic Performance

Trading and Athletic Performance

Why am I sharing this email that was sent to a client of Anthony Giacomin’s (my brokerage partner) from an experienced trader trying to help a struggling client? I do so because I believe that it is right on and speaks to the belief I hold that trading is not an intellectual endeavor; it is more like a professional and highly competitive sport.

Take the time to read this:

“Ok, now the first time i read this story was many years ago.  So some of this might be way off but you’ll get the idea and understand.

Cal-ripken

When Cal Ripken was in his 2nd season he got in one of his hottest hitting streaks of his career.  He was on a 20-game hit streak and hitting like .400 over that span.  In the 21st game, his first AB {at bat} he hit a double down the left-field line.  When he got to 2nd base the shortstop came over to him and said, ‘Man, you’re really hitting well lately.  You must be doing a great job of keeping your head down, getting your hips through the zone, extending your arms and getting the head of the bat out there.’ 

Ripken thought nothing of the comments until he was in the on-deck circle before his next AB.  He thought, ‘that must be why i’m hitting well.  I’m doing all of those things the shortstop mentioned’  when he walked up to the plate he was saying to himself, ‘keep your head down, get your hips through the zone, extend your arms…..etc…’  He then went on to have the worst hitting slump of his career.  After every game he’d change something small.  Move his elbow an inch or 2, open his stance a tiny bit, raise his hands, move back in the box, etc. After a month of terrible hitting, he finally turned it around after scrapping all the adjustments he had made over the previous 4 weeks.
What i took from this story was a few things.  One is the obvious, things he was doing naturally, without thought, worked better when he didn’t think about them.  The 2nd is a little less obvious, as a hitter that has made it to the professional level, you’re already a decent hitter.  Just natural ups/downs are going to give you streaks and slumps.  Just because you go 0-16 doesn’t mean your stance or your approach is wrong. You can be doing everything right; just not getting hits.  What caused him to be in his slump was the slight changes. That prolonged it.”

I view trading the exact same way. You trade strategy XXX and it has an edge.  If you go through a dry spell where it’s not working after a week, a typical reaction is to change entries and exits and scaling.  You start putting different values on indicators etc. I view making those adjustments as prolonging your dry spell. No longer are you trading the plan. Altering it actually creates a whole new plan that you really know nothing about and have no experience trading. I think the key is consistency with methodology as well as little, hopefully none, emotion involvement.

Now, this is NOT taking into consideration that markets change. It’s possible to trade a method and after 18 months or so it just doesn’t work anymore. That can and does happen, so keep that in mind when thinking about this.”

Many of the folks who have attended my chats or listened to the webinars have heard me say that you always have to go through a new learning curve every time you change something in your approach. Make a final decision on what you will use and master and just stick with it. Just like in sports, everything works…or not…depending on how you approach and use it. Same in trading.

I felt that this story was very convenient to make my point about hopping from guru to guru, system to system and blog to blog. The result is money wasted and time consumed with no result to show for it.

This is the point of this blog entry.

Keep it simple.

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5 Comments
  • Jedi
    Posted at 18:48h, 17 November Reply

    Good analogy, FT71. Thanks for sharing the letter.

  • Jane
    Posted at 19:25h, 17 November Reply

    I think it is definitely important to do some research before Changing career. There’s a company called Ascentador that talks about this on the website.
    Cheers,
    Jane

  • Majik
    Posted at 16:52h, 18 November Reply

    Excellent!

    Thank you for the post FT71.

    Once again, a philosophy of maintaining one's focus and building on one's own personalized foundation – Not the anticipated expectations of following the illusions of what is perceived to be the reality of others.

    Relativity in all cases – works in any facet of our lives.

    Keep up the great educational content FT.

    I'm looking forward to your next presentation.

    Peace-
    Majik

  • E
    Posted at 22:49h, 19 November Reply

    Great post. I have a strong background in teaching and coaching athletics, and this is right on. Skills are necessary, and then it takes mental agility to stay focused and disciplined, no matter what distractions, obstacles, and fears to let our edge give us our results.

    You are a class act and I appreciate your efforts to teach.

    E.

  • tompower1963
    Posted at 10:36h, 21 November Reply

    yes, one would have to concur with that. You can't over anaylyze what you are doing right just go with it sometimes. And of course until it becomes ineffective and the recognition of that change.

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