My 30 Day Trading Plan
In a wonderful little TED video Matt Cutts talk about the joy of trying out a new behavior for the next thirty days. From giving up sugar, to doing 10,000 steps daily to even writing a 50,000 word novel -- he makes the point that you will be amazed at what is possible to achieve within that time frame.
Cutts also notes, that the 30 day challenge creates a much more intense experience for the person. Instead of days just blending one into the other you really remember the month much more clearly as the experience and challenge of change engages you both physically and mentally.
I watch Cutt’s video the same week as I listened to a very interesting podcast interview with Matt Zimberg who is broker that works with many different type of traders. Zimberg’s insight’s into trading may be even more valuable that someone who manages the P&L for his own account, because Zimberg enjoys an outsider status relative to the game and therefore can speak to its intricacies with much more objectivity.
One of the key ideas to emerge from the Zimberg interview is that traders should really trust their system more. The urge to override your system at nearly every single point in the market day is extremely high. Especially if the system is based on mean reversion and forces you to buy or sell at extreme price points of the day when everything looks like it’s going against you. After watching literally tens of thousands of execution reports, Zimberg said that most traders would do better to trust their system more than their gut.
Now I have written extensively about my own predilection towards “system override” and in the back of my mind I am sure that Zimberg is right. I am sure I would probably be even more profitable if I let my systems trade with much less interference. But I also know myself well enough to realize that “hand off” is just not part of my personality.
Furthermore an observation from the other Matt -- Matt Cutts -- kept going through my mind. He noted that small changes undertaken in the 30 day challenge were much more sustainable than large ones. So I decided to combine the wisdom of the two Matts and simply just trade my system for the next 30 days. No “cowboy trades” where I go off the reservation and trade impulsively without any structure. No oh-I-know-this-is-a-perfect-time-to-buy/sell-a-currency-pair trades that have no legitimate foundation in my trading logic. In short no bulls-t. Just trade my system for the 30 days straight.
I’ll let you know how it goes.