As a kid, I played Little League Baseball. I loved it. I was a good player too, at least relative to many of my teammates at the time. As a lefty with a decent arm, I got to pitch a lot. I dreamed of playing ball for the rest of my life...
Then came high school, the baseball team tryouts and a big dose a reality! I showed up not knowing what to expect. I attended a large high school so there were well over a hundred kids all wanting to make the cut. I quickly realized something. I was the shortest and smallest guy in the room, by A LOT. I first noticed this while standing in line for the batting cage. Watching the power of almost everyone else going before me was a real eye opener. A guy a foot taller than me with an additional 20lbs of muscle could really hit the ball. The physics of baseball. Sure, I had the coordination to make contact with the ball just like the rest of them. I just didn’t have the power.
Then I was waiting in line to show off my skills as a pitcher. Same issue. There was NO WAY I could throw the ball as fast as some of the guys trying out before me. Sure, I could be just as accurate and even had a nice curve ball, but no way I could compete with speed. Again physics. I quickly realized my dreams of playing ball were over before I ever stepped up to the mound. I never played again…
Now please don’t take this the wrong way. I’m a firm believer that humans can do anything they put their minds too. With enough determination, hard work and time you can accomplish anything you want! But let’s be 100% honest. There are limitations based on facts, science, physics, etc. Examples: If you’re 5’ 2”, you’re probably not going to play in the NBA. If you have poor eye sight, you’re never going to fly an F-15 for the Navy. If you can’t carry a tune, no band is going to hire you.
Here’s my point: No matter how hard I tried, how much time and effort I put in, I never could have played baseball in high school, let alone college and beyond. It simply wasn’t physically possible. I wasn’t anywhere near good enough nor was I blessed with the physical attributes one truly needs to be a professional athlete.
Sure, I could have busted my ass, worked out and practiced all the time and maybe, just maybe, there would have been a 1% chance (probably less, much less) I could have made the team the following year. For me, all that work wasn’t worth such a small % of a chance. Instead, I worked just as hard (if not harder) on something completely different. Something where the odds were much greater in favor of my success. After all, nothing was going to make me taller…
So, what in the hell does this story have to do with Day Trading???
It describes just one of the many things that is so great about Day Trading: Almost anyone can do this for a living. It doesn’t matter how tall you are. It doesn’t matter what your build is. It doesn’t matter where you live. It doesn’t matter what your previous jobs were. It doesn’t matter how old you are. It doesn’t matter what you look like. It doesn’t matter what your level of education is. You don’t need a master’s degree to be a Consistently Profitable Day Trader!
However, you DO need an unrelenting desire to succeed. You do need a work ethic, a really really really really strong work ethic. You must also be open to learning about yourself AND be willing to improve on your character flaws. Example: If you’re the type of person who doesn’t like to be wrong and can never admit it, forget it. Go do something else. I know, I know that’s not you… But if you’re serious, go ask your spouse, family and/or friends for an honest answer to that question and find out what they think!
One point I want to make crystal clear: Becoming and staying a Professional Day Trader is just as hard, with just as much work as becoming a professional ball player, or becoming a professional anything for that matter. Sure, the actual work and skill sets required are completely different, but the amount of work is still there. You must practice and practice and practice. You must review the game tapes. You must workout, especially your brain and emotions. You must be willing to change your mind and emotions too. And you must have both the mental and financial capital to get you through the try outs.
This my friends is the reason that “90%+ of all Day Traders fail”.
YES, Day Trading is hard. It’s freakin’ hard. But it’s completely doable IF you’re willing to put in the work. Most don’t. Like a normal job, they think they can show up on-time or maybe a few minutes early to work and have a nice day. The markets open at 9:30am but that does not mean you get to show up at 9:15am. You think a pro ball player shows up 15 minutes before the game without doing any homework on the opposing team?
Why do you think so many newbie traders gravitate towards the con artists on the street? Why do they not care that they are being front run all the time? They’ll gladly follow a trader who says “I’m in $XYX” and then frantically try to hit the buy button hoping for an entry close to the price that was shouted out but long gone. Why? Simple: They don’t want to put in the work, the time and the effort to learn how to trade. They would rather be told what to do and when to do it. That’s so much easier than developing a process. However, that is not sustainable over the long haul.
Why am I a consistently profitable trader? Because I bust my ass and I am willing to change. Period. Every character flaw of mine that gets in the way of me making money in the market, I fix. It’s not because I’m smarter, faster and/or taller than the next person out there. Again, this is why anyone can do this. You’re competing with the market and yourself, no one else.
There’s another small but tricky point I want to make here: Not everyone can nor should be the same type/kind of Day Trader. I learned over the years by trial and error (and losing $$$) that being a momentum trader best suits me. My borderline ADHD personality fits best with stocks moving quickly. I hate waiting for anything. I want to jump in, be right or wrong almost immediately (unless Level2 gives me a clear reason to stay in) and then sell SOME quickly. I don’t need confirmation from some crossover. I don’t care where VWAP is. Nor do I draw random lines on my charts. For me and my trading personality, it’s all about price and volume.
Not everyone has this same type of trader personality. That’s great! That is exactly what makes a market. YOU need to find what fits yours. If YOU need crossover confirmation, vwap and 50 lines on your charts, go for it. Do whatever works for YOU. Find YOUR process. Just PLEASE make sure you know WHY you’re using what you are using. Basically, have a legit reason for using what you are using. Don’t just use something for the sake of using it.
In short, you must figure out what type of trader you SHOULD be. Notice I said should be, not want to be. You don’t always get to do what you want to do. One should accept this and focus on what they should and can do…
Let’s go back to baseball to explain this point. Almost everyone in little league wanted to be the pitcher. That’s the cool position, right? I guess. But most kids didn’t have the skills for it. What a great coach does is learn about every one of the players and their individual skill set. Then they put them in the position that best suits them and the team. Placing them in the position they SHOULD be in, not necessarily the position they WANT to be in. Some got to play the outfield even though they really wanted first base. If they wanted to enjoy the game, they embraced the outfield and became the best damn outfielder they could be. That’s what successful people do.
One last note:
This past week I read yet another misinformed article (my opinion) about how dangerous day trading is. This one stated that a study found that 99% (not the normal 90% you usually hear) of people who try it don’t earn consistent money. I’m so tired of hearing/reading this all the time. Can’t we really say this about ANY profession? We’re not flipping burgers here! I bet if we did a study about who wanted to be an astronaut, or professional athlete, or actor, or countless other professions, we’d find very similar stats. Where are all the articles about that? Let's not say that day trading by itself is hard, it’s that being a true professional at anything is hard! It takes time, devotion and an unrelenting desire to succeed. So, whatever you want to do, GET TO WORK! Just remember, day trading is a profession, NOT a job.
By the way:
We’re going to be discussing what it takes be a Consistently Profitable Day Trader this Thursday (7/27) night at 7:30pm EST (NYC TIME) during our FREE webinar titled So, you want to Day Trade for a Living?. We’d love to have you join us. If you want to hear what we have to say, click the picture below and register. Bring any and all questions you have on Day Trading. We’d love to give you our thoughts on any questions you may have. Hope to see you there.
UPDATE: If you're reading this now the webinar already happened! No worries, you can catch the recording by clicking HERE!
Thanks for reading! Questions? Comments? Reach out and/or leave a comment below.