What has a bowl of coco pops got to do with knowing your numbers and successful trading?More than you might think
I saw the above picture in my Instagram feed by a Fitness Professional Ben Carpenter, someone who I follow and respect a lot! A very smart, and funny personal trainer and fit pro, who in short, knows his shit and is all about the numbers and the research.
Now, I am no diet or nutritional expert and I am not professing that successful trading comes down to your cereal of choice however, there is a point here I am coming to!
Earlier this week I posted this picture in the Traders Support Club Private Members Forum, asking our students what they thought was link between two same size bowls of cereal and their own trading? These are a couple of the responses I got: –
“Two setups, which both look similar on the face of it but one will give you much more bang for your buck.”
“The markets can be deceiving and sometimes can be too good to be true, therefore leave no stone unturned when analysing potential set ups.”
Pretty good responses I would say and two very good points to consider. Maybe the second one is implying the granola is too good to be true? Which leads on to the point I want to make about successful trading. But first…
In Ben’s post he makes the point that when someone starts dieting it’s common for them to switch to what they are think are “healthy” foods. Now with dieters’ main goal usually being weight loss, a consistent calorific deficit will be the main contributor to their success. So, in the granola example they can, without even knowing, unwillingly end up consuming way more calories than they should. All done because their focus is simply by thinking they are making “healthy” or smart choices.
So, I hear you cry! “How does this relate or even help me in my pursuit of successful trading?”
Let’s just stay with the losing weight theme for just a little bit longer.
How could this lack of knowledge or understanding be helped or made better? Does that person need a complex understanding of the nutrient combination of granola and the metabolic processes that happen in the stomach ones it’s consumed? Nope, they could just start with not always believing the headline on the packet. Or at least questioning the headline and taking the time to know the numbers of what they are consuming! Then, further on from that, track their own calorie intake and then take the time to review those numbers on a weekly basis. Anyone seeing the link to successful trading yet!?
The same comparative issues can arise with a trader. Yes, complexity of understanding has its place in trading as often it’s not as simple as some may state. Just like weight loss, many trading educators do new students a disservice by making and marketing trading as simpler than it actually is. Yet many also market it as something way more complex than it needs to be! But that’s for another blog post………
So, you could start by firstly asking yourself, are you taking the time to know your numbers? Then, are you putting in the time to track your trades and trade stats? Or are you NOT because it feels like too much hard work or it seems too complicated? Or are you doing the first two but are either tracking the wrong numbers or don’t know how to interpret the numbers you have?
The challenge is the food industry (just the trading and trading education industry) are marketing to you with words and phrases that can lead you to make certain choices. Headliners like “healthy option” or “90% win loss ratio” unbeknown to the reader can lead them down a path that creates false hope around their actions
Another contributing factor in both cases can be having unrealistic expectations, which again is a whole other blog post subject in itself. This is then aided by the headlines, then is compounded by not understanding the numbers and then not tracking them once the person gets started.
I have heard the excuse with people trying to lose weight and learning to trade that it’s all just too complicated and there is so much information to consider. That might be the case but have they chosen to believe that without doing the work and getting the help from people who know what they should be focussing on.
Try asking yourself the question, are you taking the time to study what the real numbers are in both your bowl of granola and within your trading strategy? That way you may see if your unknowing actions are taking you further away from your goal and putting you at greater risk of failure?
And if you are not sure where to start in your pursuit of successful trading, remember we are here to help so get in touch. Very often our job as trading coaches and mentors is not to teach you something new but get you to look at what you are doing and get you to look at it differently! The result is then you change your actions. Remember though at TSC that’s for trading. If it’s for weight loss I would go and see Ben.
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What a fabulous analogy….. just shows how everything is everything ….. one can cross learn from different areas not seemingly related…… great read!
what an eye opener , just realized what i’ve been doing wrong. WOW!!
Great post Ali, love the message brought home by the analogy. Yes, for me, sometimes logging my trades and screenshotting feels tedious, but you’re right…analysis of what I’m consuming (trading) is essential to achieve my trading goals!
Glad you liked it David. It’s all about creating these good habits even if we don’t enjoy every task my man!