Parallels between trading, marathon
The recent Ski World Championships provided a number of lessons that we as traders may take something from.
They started with U.S. favorite Lindsey Vonn crashing and ending her season by tearing her MCL and ACL while breaking her tibial plateau.
Lesson 1: Bad things happen to the best.
It is hard to call this a "black swan" event, as ski racers get hurt all the time, and the knees go first. So there's a direct parallel here for traders (aside from the knees).
Lesson 2: The best get back up and focus on the process.
In her absence, two other U.S. skiers stepped up to fill the void. Ted Ligety won three gold medals, something that hasn't been done in 45 years. And Mikaela Shiffrin, at 17, became one of the youngest world champions in history.
There are some sports where newcomers can perform well if they come into it with the requisite attributes, such as 12-year-old rock climbers who can outperform those that are "stronger" and much more experienced. But there are other sports that people can take up in college and still make the Olympics or even become a professional--mostly involving endurance.
Fortunately, trading fits into the latter category. Unfortunately, many people apparently believe that it can be mastered as newcomers.
New traders can have excellent results, of course, but they are by far the exception. And unless they put in the time and effort needed to develop skills, their "beginner's luck" will quickly run out. In fact, these traders are often the biggest losers in the long run because their early success makes them believe that they are invincible.
This brings me around to a couple of other sports articles about Tom Brady I was reading this week, one from The Talent Code and the other from Fox Sports . Both use his photos from the 2000 NFL Scouting Combine to illustrate how hard he has had to work since then, at least physically, to become the superstar quarterback he is today.
The point of all this is that natural-born talent alone is not enough to ensure success in sports or in trading. It is about persistence, preparation, and grit--and how we respond to adversity.
Think of it as a marathon.
(A version of this article appeared in optionMONSTER's Options Academy newsletter of Feb. 27.)
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