If you have been trading for any length of time, you probably succumbed to the most common mistake that we, as traders, are prone to make. Trading is like any other endeavor in which we strive to be successful. To become consistent and profitable takes an immense amount of time and effort. Remember that Malcolm Gladwell, in his book Outliers, talks of ten thousand occurrences as the magic number to become proficient as an expert. Trading is not any different, although many investors become attracted to trading as a path to get rich quick.
Most traders try to shortcut the process to become consistent and profitable. Instead of taking the time to become an expert in a proven trading method and spending time on a refining that method, most traders are prone to jump from guru to guru or from system to system in search of the ever elusive Holy Grail.
The reality with any system that some self-proclaimed guru is currently touting is that all systems work until they don’t! Think about that for a minute.
The financial investment and investment advice space is a multi-trillion dollar industry. Huge international companies are constantly competing for the investor’s dollars either to offer investment advice or sell a system that guarantees returns. Consider that these huge multi-billion companies can throw almost limitless dollars to find something that works 100% of the time. With nearly unlimited resources, would it not make sense that, with the state of technology today, at least one of these firms would have developed the perfect, guaranteed system by now? News flash… they haven’t!
Think about this: if a perfect system became developed, would a financial market even exist? The financial markets require both buyers and sellers to make a market. If one or more parties had “100% guaranteed” system, who would take the other side of the trade?
Instead of wasting your time and money searching for the Holy Grail by jumping from system to system or guru to guru, you would be much better served developing your skills with a proven method that generates tangible, quantifiable results.
Consistent results are achievable by using a method that simply relies on probabilities and basic mathematic principals to provide the edge you need. Focus your efforts where the odds are in favor of your success and not on the latest and greatest system that works great until it doesn’t!