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10,000 hours, really?
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10,000 hours, really?

  #111 (permalink)
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I wonder how many hours have been spent debating the merit of 10,000 hours until mastery...

20,000,000
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  #112 (permalink)
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AJ
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  #113 (permalink)
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jimjones26 View Post
I wonder how many hours have been spent debating the merit of 10,000 hours until mastery...

At least 10,000. We are all master debat... oh never mind.

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  #114 (permalink)
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squ1d View Post
Why would you need to know what makes the market run or how the software works? Your job is to figure out what makes the ticker move, and how it moves. Not how the infrastructure of the market works :P

If you're making the line go from the bottom left to the top right of your screen, you're doing the job.


You do not "need" to know to be profitable. This is the distinction that so many in this thread fail to grasp. Its a 10,000 hours to master. Not 10,000 hours to profit.
If you are teaching classes and writing books on trading, CNBC is calling you for guest appearances, everyone you know calls you for advice, or you trade large amounts of other peoples money then you might need or want to be a master. You might need to have extensive knowledge and experience in all sorts of market conditions and all sorts of instruments. You might need or want to be intimately familiar with all sorts of theories and strategies. Both good and bad.

If you were a master you might know many many things which are not necessary be a profitable trader. Profitable enough to call it your profession and have it be your primary source of income. This does not take, or should not take 10,000 hours. My guess would be 500 to 1500 hours. This include all reading, studying, and practice.
That will not make you a master, but you don't need to be.

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  #115 (permalink)
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mcteague View Post
You do not "need" to know to be profitable. This is the distinction that so many in this thread fail to grasp. Its a 10,000 hours to master. Not 10,000 hours to profit.
If you are teaching classes and writing books on trading, CNBC is calling you for guest appearances, everyone you know calls you for advice, or you trade large amounts of other peoples money then you might need or want to be a master. You might need to have extensive knowledge and experience in all sorts of market conditions and all sorts of instruments. You might need or want to be intimately familiar with all sorts of theories and strategies. Both good and bad.

If you were a master you might know many many things which are not necessary be a profitable trader. Profitable enough to call it your profession and have it be your primary source of income. This does not take, or should not take 10,000 hours. My guess would be 500 to 1500 hours. This include all reading, studying, and practice.
That will not make you a master, but you don't need to be.

But what is your definition of a master?

To me, a master trader is one that has very long periods of profitability with very small drawdowns. It has nothing to do with anything else other than the results. Let's say that in my mind, a master has been profitable more than 95% of the weeks over the past 3 years and has had a maximum drawdown of 5%. That indeed would take time to achieve.

Edit:
Just look at Market Wizards - most of them were really good at one thing and they just pressed the same button over and over and over. Most of them were trend-followers, but others were scalpers, and they didn't care about what other people were doing. They were mastering their style of trading, and are only considered market wizards because of their results and results alone.

I'll give you an example: I know someone from a very prominent mutual fund who doesn't actually trade or make investment decisions. In fact, he's really bad at it. However, he's a people's person and has gray hair, so that people trust him with their money. He takes their money and gives it to the actual decision makers. He is consistently invited to CNBC and Bloomberg TV to speak about his view on the markets. That's not a master to me, even though he knows more about the US economy and the investment business than 99% of successful traders.


Last edited by squ1d; March 8th, 2013 at 03:25 PM.
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  #116 (permalink)
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squ1d View Post
But what is your definition of a master?

I can tell you what it is not. It is not become profitable.

These are clearly subjective terms. Your high school physics teacher had a certain mastery of the subject. But she was not Einstein.

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  #117 (permalink)
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definition of a master

I am a master

I have a cat

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  #118 (permalink)
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mcteague View Post
I can tell you what it is not. It is not become profitable.

These are clearly subjective terms. Your high school physics teacher had a certain mastery of the subject. But she was not Einstein.

Indeed. Becoming profitable should be attainable within 1000 hours or less of deliberate practice in my opinion.

Philosophically speaking, genius may be a different animal than mastery (in the case of Einstein). I don't think that trading require insights of the magnitude of relativity to become great at it.

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  #119 (permalink)
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Big Mike View Post
And what about the traders whose charts are constantly changing? I mean different specialty bar types, different indicators, and thus different setups?

Is the 10,000 hours cumulative across all these differences? Or does one need 10,000 hours on a vastly similar approach to be an expert in that approach?

How different is trading one "chart template" with one bar type, and one set of indicators compared with a different "chart template" of a completely different bar type and indicators?

What about varying methodologies such as trading divergences vs breakouts, or trading extremes countertrend vs trend following and trend continuation? Do you need 10,000 hours of each?

Mike

I started part-time trade 2009. Been consistently profitable trader since mid of 2012.

In the beginning I was looking for the holy grail and changing my charts all the time, this is the biggest mistake a trader can do, second is to trade under capitalized, but this is not what this thread is about...

Stick with one chart temple/workspace at least a couple of months and focus on a few setups.

I think one year is enough if you from the beginning understand the importance to stick with one chart template. My opinion is, if you constitutions changing your charts, you will probably never be a profitable trader.

So, my 2 cents... If you want to experience a long learning curve or not, is up to you!

"insanity is doing the same thing over and over again and expecting different results." - Albert Einstein
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  #120 (permalink)
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10,000 hours



DionysusToast View Post
Prop shops give traders 12 weeks of training & then let them work SIM till they get good enough to be let loose on 1 or 2 lots. Some people are there on week 12 and some never get there.

3 months, not 5 years.

There wouldn't be ANY professional traders anywhere if it took 5 years of full time commitment to get profitable.

Think about it people, how would a firm be able to survive if if they had to pay people for 5 years before they got a return? How would prop traders on a stipend of $750 a month survive for 5 years on that pittance before they made enough money to buy a few new shirts, or eat.

What is it that occurs at hour 10,000 that is so special? Why not 5403 or 1726 or 8983?

It's just a myth perpetuated on teh interweb in my opinion.


one can always briefly search engine for something and only then have an opinion.

i am not a profitable trader just yet so i won't comment on that particular endeavor, but i'm knowledgeable in the subject of high performance.

it's scientific, it's fairly new and there are reputable experts on this field of knowledge. gladwell became famous for divulging the work of the field's founders, but he is actually very poor at communicating the key points there are. k anders ericsson and others have been developing this branch of knowledge for 20 something years now. ericsson recently put out the Cambridge Handbook of Expertise and Expert Performance which is not easy to get but a great read. and then, don't go to gladwell, go to tony schwartz to get a good panorama on the matter. schwartz founded a company called the energy project and has a great column on the harvard business review. he has worked with ericsson and other experts and has himself been teaching and implementing high performance in a multitude of areas. about 5 articles in the hbr sum up a lot of his positions: Six Keys to Being Excellent at Anything, Six Keys to Changing Almost Anything, The Magic of Doing One Thing at a Time, Manage Your Energy, Not Your Time, etc.


i have a blog on high performance, can't post the link, but you can easily find it searching for marcosagg. there two of schwartz's conferences can be found, and i won't waste time and energy typing what you can listen to in the two lectures, but the insight is great.


at the close of one of those conferences, schwartz explains ericsson's most famous experiment. the Berlin Academy of Music experiment, which first rendered the 10,000 hours of deliberate practice number and which states that talent does not exist in itself: anyone who presently has an ease or mastery at any task achieved it necessarily through past hard work. there are no "naturals", it's winning habits, proper rest, enough work in deliberate practice and appropriate coaching that take anyone to the top. the number holds for basketball players, olympic atheletes, engineers, designers, writers, comedians, musicians, and any world-class public performer.





Surly View Post
I would disagree with the reasoning behind the claim that it should take 3 months, if not no prop shops would exist. The prop shop environment is instructive I think - @TopstepTrader could comment on this with some authority I bet. Doing an informal scan of the "funded" traders on topstep I would estimate the average years of experience (including trading prior to working with topstep) is something like 3 or 4. I think you'll find that many of the traders who become funded with less experience have some background in finance or a related industry.

As to prop shops more generally, they don't just hire people, train them for 3 months and, presto, the trader is consistently profitable. If that were possible, who would they win money from because every tom, dick, and harry would be hiring MBAs and making them profitable in 3 months - who would be unprofitable? Maybe they hire someone with a few years of experience and turn them into a mildly profitable trader in 3-6 months but I would guess that much of this is due to the very tight external risk controls and constant coaching they receive. This idea that the average smart, motivated person can walk off the street with no experience and be consistently profitable in 3 months is fanciful IMO.

The 10,000 hour mark is obviously an approximation, not a magic number. And it refers to expertise, not mere competency. Finally, the research literature is pretty clear on this subject - which may or may not mean anything depending on your belief in statistical research and the scientific method.


an interesting series can be found in youtube, called Million Dollar Traders. a trading room of 15-odd complete novices was set up in london's financial city with one million dollars available to trade in 2009. they were filmed for reality tv. not every single apprentice got to the finish line or turned a profit, but the room outperformed the industry's average and placed near the top over a period of a couple of months.



BishopM05 View Post
^ I believe this is the key factor here. Along those lines, saying that as long as you're doing something for 10k hrs will get you mastery in trading is a little too much to assume. Too many factors go into when a trader "gets it", so I think of the 10k hours as an average. Sure, getting professional training and doing all the right things consistently can decrease your time needed just as podski says, "10,00 hours of slamming your balls in the fridge door is really hard , both physically and mentally" will potentially increase the time required.

Also, I've been reading a book (see below for link) which tries to figure out similarities between creative entrepreneurs - given that each has their own unique qualities that have made them successful. I haven't finished, but what I've read so far is that each individual makes a small, educated, and deliberate first step towards a goal. If things work out, they continue. If things don't work out after a measured amount, they evaluate and either adjust or move onto something else. I think this is interesting correlation for traders, however my only inclination against this sort of philosophy towards trading is that beginners often take too small of a step and change too frequently - exactly as Big Mike preaches against. That darn measured amount though..that's the tricky part! How long do we go without changing things?

I don't subscribe to the 10k hrs as a hard line, but I feel it's a good enough rough estimate to stop all but the biggest egos out there to assume they can do it in a day


Amazon.com: Action Trumps Everything: Creating What You Want in an Uncertain World (9780983131915): Charles F Kiefer, Leonard A Schlesinger, Paul B. Brown: Books



this is the part about deliberate trading. it's not spending 10,000 hours doing just whatever, people who do get to the top spend those hours in activities that are conducive to developing and furthering specific skills. fruitful, challenging work, which renders measurable results and is directed by someone with superior knowledge.

you need to get a very good outline of how markets work and how money can be made, then, experience different market modes and seasons in person, try and err for a while, get a massive edge and execute it consistently. that would be a rough outline of a learning curve for profitable trading according to me. and there has to be gradual progress along the way, it's not like once over a particular threshold of hours devoted to trading you can't place a bad trade anymore.

there might be people that can get there pretty much on their own, others might rely in getting appropriately coached. but yeah, there's solid research to back up the fact that anyone can learn anything someone else does within reasonable parameters.



BishopM05 View Post
I agree with that 100%...I wish I had the apprenticeship thing from the beginning. Of course, I'm new to the industry and no one in my family or circle of friends are even close. So, having no bar to measure, how could I have picked a good mentor? I don't have the capital to pay for one, and how can I trust someone else who offers to show me a few tips/tricks for free anyhow? Here, do this because I have made x amount of money for 1 year...pssh. As a beginner, there's no way to know if any of that suits me. A consistent, competent coach seems to be the best option, but also having skin in the game for a while will teach me where to set the bar for consistency & competence.

Perhaps this is why old money stays old, and us new dogs have to work our asses off to get a shot at creating something for our families...oh well, I guess I'll be in the over 10k hours category. Ha!


this makes a lot of sense to me. here what i would say is that common sense is also huge and not everyone has it from the time they start trading. through what i read in the news and financial sites and in spite of the alluring spin they always try, i firmly knew that the "buy and hold" strategy, (the only way to make money off the market in the minds of most), would absolutely not work to make money from 2007 onwards. only after attending a trading conference did i learn of selling a stock short of having it and then realized money can be made in the market nowadays (hugely complicated and risky, but possible against all odds still).

with that same common sense i presume i can discard snake oil remedies for trading, but also take some indicators and strategies that seem valuable to me.



DionysusToast View Post
The danger as I see it with the 10,000 hours thing is that you might have people reading this thread, with 3,000 hours invested and NO CLUE about trading and no idea what moves price.

These people could, in theory, pat themselves on the back, double their efforts and tell themselves "only 7000 more hours to go" and continue making zero progress.

The 10,000 hours itself is just a number from a book, thought up by some guy. When looking at numbers like this, you have to consider why he came up with 10,000. It is a very nice, round, big number isn't it?

Why not 7473? or 5610? Not so appealing are they?

Fact is - there is no real science behind the number being appropriate for trading, it's just a lovely, big, round number, which attracts people. It attracted Mr Gladwell, it attracts people on trading forums.

There is no basis for this particular number being more appropriate than 8,000 hours. None at all. There is no basis for this number being more appropriate than 11,000 hours. It really is just a made up number and it has really taken root with a lot of people.

I've heard people say "Stare at the DOM for 10,000 hours and you will see it". Seriously? Stare at the DOM for 10,000 hours and you won't be able to see anything!

You need a reference point. You need to know what to look for. Doing it "The hard way" isn't necessarily "The smart way".

I'd say, if you are 500 hours in and you really don't feel like you have progressed, then you need to change your approach. If you don't have a way to monitor your progress, you might as well stop altogether.


the 10,000 hours stuff is legit, scientific and solid. doctors, researchers and prestigious universities stand behind it. probably more so than a lot of trading methods in themselves which can be more art than science.

but yeah, you have to be making gradual progress and learning from those that already are where you want to get to. and in the end, the number of hours devoted into learning to trade is not that important, it's the quality and direction of what you are doing, and the bottom line of limited time and money to devote to trading will also put those who aren't making enough progress out of the market as well, sooner or later.



mattz View Post
Today’s trader is the most overwhelmed person in the history of trading. The platforms have created a perpetual paper trader, the educators have created traders who move from one method to the next, and the different software vendors also cause traders to move around from one method/platform to another. This is ALL in the hopes of finding the “right” consistent method.

The idea of a focus has gone out the window.

At some stage the attempting trader finally gets it. He starts the focus on the method that fits his/her personality (framework, time frame and frequency) learning a platform A to Z, ignoring the irrelevant info and focus on things that matter.

He starts to gather information from experienced traders and not those who know only 1% more than him/her. The process of tweaking starts and finally accepting the fact that not all the stars have to align to pull the trigger while simplicity could be applied.

The “getting it” part depends on the individual trader and would make the differentiation between the hours it takes to master it. When you “get it” might be 1K hours, 3K hours or 5K…after that the work begins. I must say that considering all the choices that traders have today 10K is reasonable. Bottom line is that the 10K hours is not always the learning part, sometimes it’s the hours of sorting the BS from the real content to learn from.


absolutely agree. but then, the hours developing an eye and finding common sense were obligatory and not wasted by any measure.



one other thing i would point out to is that one of the great difficulties of being an independent trader is actually in being independent itself. i work in management consulting, and for a couple years now have been going the freelance and independent route. self motivation is something that most people struggle with, and the self discipline required too work on your own is huge too. i witnessed many cases of people who had all the technical knowledge and experience required to contribute to projects i worked in but that wouldn't hang on for long because they couldn't manage themselves. that's why most companies have office spaces and fixed working hours, because the vast majority of people perform far better when given structure and direction.

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