Last year, I wrote a blog with the same title and we talked about ten of the "spookier habits" we see Day Traders struggling to overcome. I've officially decided that this will be an annual thing! If you didn't read last year's post or want to refresh your memory, simply click the very cute but awkward looking bat now or when you're done reading this.
Now, on to this year's list...
1: Insanity. Doing the same thing(s) over and over expecting a different result. Tomorrow is going to be different! I lost $1000.00 today, but tomorrow I’m going to make all that back and then some! Really, what are you doing differently tomorrow? Well, I’m not really sure… You must have a written down game plan and conviction to implement your plan if you’re ever going to change anything in your life. Without a plan, sure tomorrow may be different, but guess what? That’s just luck! And luck will only get you so far in life and in Day Trading. If you’re stuck in a rut and think tomorrow is going to magically be different without a plan, it won’t be. Every day will be the same until you stop doing what you’re doing and try something new. If what you're doing isn't working, why are you continuing to do it?
2: Following the wrong people. Wayne is sooooo sassy at times and he drives me nuts! That one guy on twitter is such a cocky a-hole I have no clue how he has over 10K followers. I hear people complaining about traders like this all the time. If someone bugs you, gets under your skin and/or doesn’t help you in anyway with your Day Trading career, then STOP FOLLOWING THEM. Seriously, if for some reason I stress you out and cause your blood pressure to rise, why are you reading this? This includes the random person that keeps reading my blogs and then emails me about how "immoral" Day Trading is and "God doesn’t approve". Are you sure she doesn't? Guess what? I obviously disagree and you'll never change my mind, so move on my friend. Peace be with you, but please go bug someone else.
3: Ignoring the wrong people. If you’re only surrounding yourself with people that completely agree with you, you’re going too far the other way. Many people I follow and dialogue with in my Day Trading life have drastically different viewpoints from my own on many things. However, if I respect them as a trader and a person, the fact that we don’t agree on some stuff has little bearing on our business relationship. Hell, I’ll even hang out and have a few drinks with them at the corner bar, just as long as we only talk stocks and not stuff like politics, religion, or how great The Beatles were. Ridiculously over rated band right there! Far too often I’ll see someone block and/or dismiss a person simply because they had a disagreement about something. Usually one small stupid thing. Our overall political climate is teaching everyone it’s ok to act this way, but it’s really not. Bring a little civility into your Day Trading, and life in general, and I’ll suggest you’ll be a lot happier. Too often people STOP listening to the people that are simply trying to tell them the truth. We all need tough love once in a while. Stop being a snowflake and really listen to what you need to hear. The truth hurts once in a while.
4: Not spending your time wisely. This is related to the first two but slightly nuanced. Why are you spending a ½ hour a day watching the recap video of someone who obviously does nothing more than pump stocks to his/her flock of sheep? Why are you spending time in that chat room taking “calls” from a moderator who isn’t even willing to risk his own clown money on said calls? Your time is limited. Your time is precious and is THE most valuable thing you own. Spend it wisely. If you don’t value it, who will? Spend it on things and with people that are actually helping you get to the next level. Tune out everything that isn't.
5: Setting unrealistic expectations. I just took Mike and Wayne’s course and now I’m going to make $500 per day at least! Not so fast buckaroo… Slow down. If you’re not making ANY money consistently or only small $$$, nothing is the magic bullet and going to finally start making you millions tomorrow. Learn a process. Study that process. Implement the process slowly. Adapt the process to your trading personality and make it become YOUR process. Then, and only then, will you have a chance of banking bigger consistently.
6: Not pushing that buy button. It’s my mission (well, one of my missions) in my Day Trading life to help as many traders as I can get over this hurdle. It’s a HUGE issue for many and it was BY FAR the single biggest obstacle I had to overcome. If you’re too risk adverse, I’m here to help. Reach out after watching our FEAR webinar (<<--just click) where we dove into the topic. Remember, you’ll never hit the ball if you don’t swing the bat. And related to #5, swing for singles and doubles, the home runs will come later and far less often.
7: Not pushing yourself. Complacency. Stuck in a rut. What’s your daily average P&L over the last month or quarter? $20 a day? $200 a day? $2000 a day? Green is green, and I have mad respect for any of those stats. But what are you doing now, today, tomorrow, the next day and beyond to get past your current level? If you’re making $200 a day, making $300-$400+ isn’t going to happen on its own or by magic. See #1. YOU have to do something different. You have to shake things up and push yourself. Here’s a tip: the answer is rarely “I’ll just increase my share size”. Unless you’re trading way too small, more shares is not what you need. Rather, you need to increase the number of plays in your A+ Setup quiver, find more of your A+ Setups and/or learn to hold more of the shares you have for longer.
8: Focusing on getting noticed and getting attention, rather than making $$$. Look at me! Look at me! Someone recently asked me why I didn’t tweet more (including what I'm trading) during the day. Well, not only will I never try to pump a stock via $TWTR, unlike the #TFB, I’M TOO BUSY TRADING. I have no idea how so many traders actually trade yet manage to post non-stop on twitter and/or in their chat room. The attention seekers are always like “keep an eye on $XYZ” and I’m like, maybe YOU should stop typing and focus on nailing your entry on $XYZ. Oh wait, you’re already in and merely "calling" the stock now, I get it… Or wait, you don’t’ actually trade, my bad! You’re just here to get more follows and likes... You can see and find all the great A+ Setups in the world, but if you can’t execute you won’t make a dime. The ability to execute consistently is what makes someone a professional trader. Regardless of what social media makes you believe, Day Trading isn't a popularity contest.
9: Making excuses. Those damn market makers! Those damn algos! HFTs suck! My freakin’ POS broker! Those idiots in my chat and on twitter. WHY did I listen to Wayne on $TSLA? This whole thing is rigged against me! People who think like this drive me absolutely nuts! Sure, I’ve had the rare occasion or two to blame E*Trade for a screw up, or my cable provider or something else outside my control. However, 98.765% of the time a trade doesn’t go my way, I mess up and I have a losing trade, I don’t blame anything or anyone but myself. Intellectual honesty will help you go far in life and is essential when it comes to Day Trading. OWN IT. When CAN you blame someone or something else? When this happens:
As our course takers know, I’m actively trading and testing our new after hours “The Algo Got It Wrong” Setup during this earning season. FSLR was a prime candidate. Then market depth went haywire. Thanks E*Trade!
Happy Halloween everyone!
Thanks for reading. And remember, don’t eat too much candy, especially if you’re not using a standing desk and treadmill while trading!