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This interview is worth a listen. FYI at the end the interviewer does a pitch. But the interview itself is not trying to sell anything and has some excellent points.
Interview with one of our frequent readers, Larry Tentarelli.
Michael Covel talks to trader Larry Tentarelli. Tentarelli started trading his own account after leaving Merrill Lynch in 2003. Covel explores some of Tentarelli’s influences: from Napoleon Hill (taking accountability for your own actions), to Jesse Livermore (“The money isn’t made in the daily fluctuations; the money is made in the big swings”), to Ed Seykota (“everybody gets what they want”). You don’t have to be a computer engineer or rocket scientist to come up with a trading system, nor do you have to have all the time in the world: Tentarelli spends less than 15 minutes a day on average trading his own programs. He also relates several “light bulb” moments he had that led him into trend following: from an investment in Chinese oil to reading about Tom Basso’s experiments with coin flips to determine entry points. Further topics include the distinction between predictive and reactive technical analysis; the importance of connecting and asking questions to those who have more experience than you; and the idea of knowing what you want out of the market.
"The day I became a winning trader was the day it became boring. Daily losses no longer bother me and daily wins no longer excited me. Took years of pain and busting a few accounts before finally got my mind right. I survived the darkness within and now just chillax and let my black box do the work."
Just to try and goose some discussion because this is an important topic for traders
What does it mean to "Take responsibility for your own actions" in trading?
Opinions?
"The day I became a winning trader was the day it became boring. Daily losses no longer bother me and daily wins no longer excited me. Took years of pain and busting a few accounts before finally got my mind right. I survived the darkness within and now just chillax and let my black box do the work."
Traders talk about this as if it means that one must take responsibility for everything. To me that's absurd. One has no control over the market movements, just over entries, exits, and position sizing.
Take responsibility for everything that you do control, and don't worry about the rest.
Most of us would do well to heed the advice of classical Stoicism:
"Some things are in our control and others not. Things in our control are opinion, pursuit, desire, aversion, and, in a word, whatever are our own actions. Things not in our control are body, property, reputation, command, and, in one word, whatever are not our own actions.
The things in our control are by nature free, unrestrained, unhindered; but those not in our control are weak, slavish, restrained, belonging to others. Remember, then, that if you suppose that things which are slavish by nature are also free, and that what belongs to others is your own, then you will be hindered. You will lament, you will be disturbed, and you will find fault both with gods and men. But if you suppose that only to be your own which is your own, and what belongs to others such as it really is, then no one will ever compel you or restrain you. Further, you will find fault with no one or accuse no one. You will do nothing against your will. No one will hurt you, you will have no enemies, and you not be harmed.
Aiming therefore at such great things, remember that you must not allow yourself to be carried, even with a slight tendency, towards the attainment of lesser things. Instead, you must entirely quit some things and for the present postpone the rest. But if you would both have these great things, along with power and riches, then you will not gain even the latter, because you aim at the former too: but you will absolutely fail of the former, by which alone happiness and freedom are achieved.
Work, therefore to be able to say to every harsh appearance, "You are but an appearance, and not absolutely the thing you appear to be." And then examine it by those rules which you have, and first, and chiefly, by this: whether it concerns the things which are in our own control, or those which are not; and, if it concerns anything not in our control, be prepared to say that it is nothing to you."
There are many things in trading well beyond our control. When we enter a trade we have absolutely no control over what the market is going to do. It will do what it will do no matter what we think or believe about it. We can try to talk it our direction or yell at it when it goes the wrong way to no effect whatsoever. I think a real key to trading is to get to point where you have ice running in your veins. Where you cede control of the things you can't control but take full responsibility for the things you can..
"The day I became a winning trader was the day it became boring. Daily losses no longer bother me and daily wins no longer excited me. Took years of pain and busting a few accounts before finally got my mind right. I survived the darkness within and now just chillax and let my black box do the work."
Yes, and it goes back to the point in your signature. Wins and losses no longer mean anything emotionally, they're the same. Reaching that point of detachment is the Holy Grail of trading psychology.
You are never in the wrong place... but sometimes you are in the right place looking at things in the wrong way.
I suppose that the next logical question is: if I am detached from winning/losing, why do I trade?
My answer is: because I love trading, being a trader, putting on trades, analyzing market situations, improving all the time, striving for excellence, experiencing competence. It's a life well worth living. No other justification or reason needed. It is intrinsically worthwhile.
You are never in the wrong place... but sometimes you are in the right place looking at things in the wrong way.
One major area I had to take personal responsibilities for my trading was being very honest about my weaknesses.
Nobody likes to admit they have weakness. It took me a while to come to terms with fact I had internal flaws that caused me to do certain destructive things in my trading. At some point in my journey as a trader I inflicted so much pain upon myself that I had to admit I had problems. Not with my entries and exits etc but with my own character.
I had to take personal responsibility by not pinning it on my methods but by pinning it on me. Then I had to take measures to either change or setup a system that kept my impulses in check. I largely had to do that by developing an auto trade strategy. I fully realize even today if I went manual and the right conditions happened I could lose control to my own impulses and blow out my account. That does not mean everyone has to take same path but that is how I had to take responsibility.
"The day I became a winning trader was the day it became boring. Daily losses no longer bother me and daily wins no longer excited me. Took years of pain and busting a few accounts before finally got my mind right. I survived the darkness within and now just chillax and let my black box do the work."
Yah, that's definitely a biggie. Most of us had to pay lot of money to discover how flawed we are.
I had to put my weaknesses in check by instituting some hard rules about the maximum number of trades I take in a day, how I manage open trades, and the fixed # of contracts. I never take more than 3 trades in a day and never change the # of contracts I trade during the day. This makes sure that if I tilt, damage is limited. As for open trade management, I found that it is best not to tinker with the trade until my SL or first TP point are hit. After entering a trade and setting them up, I turn off the trading screens and wait for an audio alert indicating one of them was triggered. I don't look at the market til then.
These have worked very well for me, but as you say, each has to find his own.
You are never in the wrong place... but sometimes you are in the right place looking at things in the wrong way.
for the idea and raising awareness.
