Back to comparisons of trading with other activities, I have been involved with start-ups (off-and-on) for about 10 years. Both aspiring traders and new businesses experience a "growth curve". For new ventures it goes something like this: an entrepreneurial phase where an idea is transformed into a viable business model and growth is modest; and then a threshold “where revenue breaks out, and finally revenue growth. They say the"runway" for this growth is on average 5years. From personal experience, this has rarely been the case and the variance was surprisingly large.
Just like fledgling businesses, traders spend a lot of time figuring out a personal style and an edge, perfecting their methodology, eking out modest profits, until they become consistently profitable. From my experience in the pits, some traders "got-it" right away (and were profitable immediately), some never got it and were out the revolving door, and most were somewhere in between.
Bottom line; every business is different, and every trader is different.
Last edited by tigertrader; June 3rd, 2013 at 08:39 AM.
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i think it's almost true . anything that makes a good sense is "bad" in trading and vice versa ,cutting losses short and let profits run & kill the inner ego is against our natural tendencies .so it may take years not only to find an edge but to find a self discipline for trading. in the first look 10k hours may look exaggeration but hello reality every serious skill may need this period too .
i asked my barber about how much time does an average human need to learn your job ?he replied : only in 1-2 months you will learn it , but you need another 3-4 years to master it !
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I think that the 10.000 hours thing depends
a. on what you are doing and how well you can structure those hours ..
b. how much laser like focus you can put into each hour
c. how much you enjoy each hour
.. but I also think that it depends on the sort of trading you are doing. If you are trading with a very high timeframe (weeks months) then it takes many hours for your thesis to be proven right or wrong by the market. Not all of those hours will be very focused.
If you are short term trading .. then you can get a lot of transactions of experience in a day/week/month.
I read somewhere that when you open your first account that the objective is to gain as much experience with that account and learn as much as possible before you bust it. If experience to some extent can be measured in # of transactions (i.e. decisions .. provided they are sensible) then 10.000 could be 2.000 or it could be 20.000 .. or it could be never !
Last edited by podski; June 11th, 2013 at 06:06 AM.
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Below is a link to Part 2 of Charlie Rose interviewing Geoff Colvin (who wrote "Talent is Overrated"; whose main concept is that extensive "deliberate Practice" is what makes world class"). @tigertrader recommended the book and has talked about this subject in other threads.
What I find interesting is that in Minute 5:45 of the video, Charlie Rose mentions of a personal experience when he was near Martina Navratilova who was surrounded by people, and someone asked her:
"How many hours do I have to practice to become a Champion"
To which Martina politely replied
"If you ask that question, you will never be a Champion"
Meaning, you cant be counting the hours and figuring it out how many more you need.
Your focus should be on making sure you understand what really constitutes "deliberate practice" for your trading stage (for which I dont have the answer.. yet); and making sure that you pursue it with determination UNTIL you achieve your goal, in our case of being consistently profitable traders.
I have 12000+ hours studying just options. I thought I knew quite a bit but bought into a great mentor who has enhanced my trading and provoked new thought processes. I have blown out one small $20,000 account in last 2 years but am now doing pretty well. The learning process hasn't slowed and seems to accelerate. I have included in my hours statistical studies of probably 100 indicators.. alone and in combo (huge time expenditure to find none very note worthy). and about 2 years solely developing from my own hypothesis and systems development. Again all this was enhanced by a very well travelled and experienced mentor. We trade live daily with each other. Now to become better will take time and experience which hopefully will not be too expensive.
The webinar on Wyckoff this June 13th "Weis on Wyckoff" was awesome! I have found Wyckoff to be the best of gurus. This webinar enhanced my thought process again!
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Wow I read this entire thread...all 18pages.
Talent, hard-work and deliberate practice are what it ultimately comes down to.
To clarify my post, the 10k hours is for subject mastery. It is not for competency. Let us not equate competency to profitability, but for my post they are near similar.
The 10k hours is based on deliberate practice with active feedback, then adjustments to the skill were made. These feedback loops are critical. Losing money is only one type of feedback.
From my perspective
Trading has a large learning curve due to the many variables.
Thus the need to isolate and systemize to allow deliberate practice in those variables.
Some of the trading variables that could incorporate deliberate practice are
cpu skill(programming, other)
chart skill(reading, drawing, other)
indicator reading(if you use them)
chart platform skill
broker platform skill money management skill
Structured Mentoring imo can shorten the learning and mastery curve in anything. It could provide specific and active feedback not available to most traders. Practices and games(live) optimized.
Some reasons why many traders including myself have wasted time
jumping from systems or charts
inefficient use of brokers platform
seeing the trees instead of the forest
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To become exceptional and amazingly good yes 10,000 hours sounds kind right. SMB Capital reckon it takes 3 years trading everyday to become amazingly good and i agree.
Why is 10,000 hours a load of garbage to become consistently profitable?
Simply due to the fact that if it took 10,000 hours to become consistently profitable no prop trading firm would be in business.
How long on average at a prop trading firm for trainees with average experience?
9 months trading the entire trading session everyday with 2 hours of training. Some become consistent in 6 months others in 12 months. If any of you guys know SMB Capital they say the exact same thing. Read One Good Trade and most of their trainee traders who become consistent took them around 9 months on average. Took Mike 8 months and he had almost no knowledge prior to becoming a trainee.
A Prop Shop that is very interested in me says you need to be ready to train 1 year to become consistent.
For me personally my start was a rocky road too, until one day i found the right information
I was on and off for 6 years before i decided to take it serious and become a prop trader.
From the moment i became serious and decided to adopt prop trading training into my own personal training it took about 8 months to become consistent. Break even took about 5 months. The first 4 months was just well in the red.
You will literally fail your way to consistent results.
What's different between what i was doing the first 6 years and what im doing now when I became consistent?
Everything!!!!!!!! When you start to know real traders a common thing they all say is. F*#@K the books they are full of shit. And most of them are.
I trade completely different. I don't look at candles sticks, Fibonacci, Stochastics, MACD or any of that rubbish. I look at the money. I look for pain. I look for where traders or going be exiting bad trades and new money comes in. I look for size. I look at how price reacts to size. I break it down to what the market really is and that's an auction where big players move the price. Play the players not the cards. Play the game. If you haven't guessed i'm an order flow trader.
Why is it taking so long for you
You have the wrong information. You know this industry is full of people who think they can trade but don't.
Whether trading Futures, Stocks, Forex, Options go do this if you want to become consistent. Find a prop trading firm that has trainees. Find out how they train their trainees. Adopt their training into your training. Talk to real traders who trade today and find out as much as you can. Warning these traders aren't gona tell you shit. But they might tell you enough to direct you on a common path to trading success.
You dont understand trading is a skill
Another reason why it takes you so long is because you dont understand trading is a skill.
How you become good at a skill?
By doing it over and over and over and over and over and over and over again and again and again and again for as long as you can. Then you smash that limitation and go even further.
If you're and MC Squared Student Of The Market and have read 1000 books, been in a laboratory coming up with some system and back testing it, know how to calculate stochastics, gang fan gang bang big wang, you have nothing on someone who trades everyday. Soz just trying to humour.
Hard work and actually trading will make you great. Read the books too but you need to be trading everyday and becoming good in application.
Last edited by joeyk; July 24th, 2013 at 02:31 AM.
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This is not a response to the OP - just want any newer traders out there to realize that prop firms do not consistently take inexperienced traders and turn them profitable in 6-9 months. It just doesn't happen. Prop firms that are successful frequently get applicants with 3-10 years of experience. They pick from among the best of these applicants and then put them through their programs. They don't take people off the street and turn them profitable in 6-9 months - it may happen occasionally but its not the norm.
The OP is correct that trading is a skill and that actual trading is required to become consistent. The OP is also correct that finding a successful mentor can be a great way to learn how to trade. However, the OP's notion that you can learn nothing from studying and learning concepts from written material is flawed and newer traders are cautioned to take this advice with a grain of salt. Learning can come from many different sources. I would also caution newer traders about moving to lower timeframes in hopes of becoming profitable. Generally speaking, markets become more efficient the lower the timeframe analyzed.
Seek freedom and become captive of your desires. Seek discipline and find your liberty. - Frank Herbert
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I agree with almost everything you said, except for taking my advice with a grain of salt. If i received this advice 5 years ago it would of cut my learning curve big time!
Prop Shops don't take people with no experience. That's why i said"average experience" before you even get to the first test they will want to know you have been actively trading, among other criteria. Of course they aren't going to take someone with no experience, you wouldn't even make it to the first test or meeting.
The junior traders who receive a seat in a Prop Shop can and become consistent within 6-12 months (I said 9 to average it out). The ones that become consistent are few and far between the rest get cut and mostly leave especially if its a prop shop that doesn't pay you a salary. Don't take my word for it, actually ring a prop shop up and ask them, or go to one of their seminars. If you need a reference from some book read One Good Trade by Mike Co-Found Of SMB Capital. It says the same thing if it takes you longer then that you will probably be classified as a liability. Sometimes they keep you for longer because sometimes a trader could be very close to becoming consistent and the firm wants a return on their investment. If you don't look like you're progressing and doing what's expected for a junior, you will be cut. So it's possible to become consistent in 6-12 months!
There's a long list of traders that i know who have done it in under 12 months with average experience. But you need the right information first. If you need evidence. John Grady (futures trader) did it in 9 with average experience, Mike from SMB did it in 8 months with average experience, there's literally 10+ stories in One Good Trade of many who did it in 6-12 months with average experience. A prop shop that i'm involved with have talked to me about many stories of becoming consistent in under 12 months that's why they advised me to be willing to train extremely hard for 12 months. Did i meet these traders who did it in under 12 months? Yep met some of these traders and talked to them too and it was a real eye opener. My trading friend who i trade with over skype every night and came to the prop shop with me became consistent in 7 months with average experience and i did it in 6 months with average experience. List goes on buddy boy but you need to work and i mean work dam hard. I work 7 hours a day on my trading just as a basis point for people reading this. 6 hours of that is actually trading 1 hour is study and training such as visualization and journalling and looking over video of me trading the day before. I video record my screen.
I didn't say you can't learn anything from books.
That's why i said "Read the books too but you need to be trading everyday and becoming good in application.
Other words keep reading and going to seminars and similar things but you must be actually trading. Too many times i see wana be traders reading 100x more then actually trading and they wonder why they aren't consistent yet.
Well i ask these wana be traders the question again. How many hours have you put into actually trading? 50 hours? Well there's your answer. So you want to be a trader and you only put 50 hours into actually trading and making trades and you spent 1000 hours reading books. Good luck to you.....
Last edited by joeyk; July 30th, 2013 at 03:06 AM.
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@joeyk - sound like we basically agree with each other. I believe you said you'd been trading on and off for 5 years before you "became consistent in 6-12 months" so my point is that people off the street are not going to be consistent in 6-12 months and also that even in these prop firms with all the training and coaching, many still fail.
I've posted before about it being mathematically impossible for prop firms to consistently take traders without much experience to profitability in 6-12 months, certainly not substantial profitability. You're post is very good (with the caveats I mentioned) for new traders to read in that it encourages them to seek out mentorship and/or employment at a reputable prop firm because these are the best ways to shorten the learning curve.
I have read bella's book (great read) - I have a friend who is studying with them now. It sounds like a good program (albeit expensive).
Seek freedom and become captive of your desires. Seek discipline and find your liberty. - Frank Herbert
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