Curly: "I'll tell you the secret to life. This one thing. Just this one thing. You stick to that and everything else don't mean sh*t."
Billy: "What's the one thing?"
Curly: "That's what you've got to figure out."
City Slickers, the movie
I was a golfer growing up. A good one. Good enough to win a few tournaments in high school and be offered a full-ride in college. But, I burned out before I ever got there. Wanna know why?
I couldn't get to the next level...the pro-level. What do I mean by the pro-level? Well, I could outdrive anyone and post great scores...especially in the clutch (never lost a playoff match). But, I couldn't do it day after day. Know why? Because I thought there was a skill level that I could only achieve if I perfected my swing. I would read magazine articles, study the best player's swings, and practice 14 hour days in the East Texas humid summer heat. All in the hopes of finding that one thing that would take me to the next level. And sadly, I never found it.
The worst part...everyone else thought I was great...but I didn't. So, I gave up my talents and offers and began living life as a typical young person. Always keeping this failure in the back of my mind...the what if?
Isn't it amazing that it took trading to teach me that "magic" next level? In fact, learning to trade has been eerily similar to my golf experience. Reading trading books and studying the best charts for many endless nights than I care to share. Searching and searching for that one thing...that one edge that would take me to the next level.
I assumed that talent and a perfect edge is what would take me to the next level both in golf and now trading. Thankfully, I have finally found the one thing that can take you to the next level. And I'll even be so gracious to share it with you...
There really isn't a next level. There isn't a level where everything all of a sudden gets easy. A place where you always have your "A" game. Everyday is different. In golf...you might wake up and your wrist bothers you a bit...so you naturally compensate for this condition and fight your swing for 18 holes. There's nothing you can do about this but adapt. Find a swing that you can be comfortable with...not one that is perfect....or hits that drive 30 yards further...but a swing that gets the job done whether you feel like a million bucks or have the avian flu. Learn just what that swing can and can't do...and then play golf! Day in day out...play your game. Don't worry about the dude that can drive 50 yards past you or the guy putting the lights out in Memphis. Play your game day in and day out with the knowledge that some days it will rain, your body will not be 100%, you're moods will change, people will change, and courses will change. And if you can stick to your game despite all these changing conditions...you'll find the so-called magic next level. Same goes with trading...
Find a strategy that gets the job done...might not belt out 50% annualized returns with 10% drawdowns...but works for you...and more importantly fits you. Don't worry about what anyone else is doing...just trade your strategy day in and day out. You'll never get to a point where the profits are easy and you can just print money at will. Realize that. The best you can hope for is you'll get to a place where you'll know your system and what it can and can't do...and you'll follow it. Simple as that. Some days...you'll look like an idiot...and other days a genius...and understand that's what it's all about. It took me all these years to figure that out. Crazy, isn't it?
This "one thing" can be applied to many aspects of trading. For example, in your backtests...do you optimize parameters on your entire trade set? If so, that's a perfect world that will never happen again. Throw out the best 5% - 10% of trades from the set before you begin tinkering. That way you're designing a system built on a bit more realistic data.
Same goes with golf...do you play that par 5 as something you can reach in 2 on your best day...everyday? Hmmm...
Several years later after my burnout I did pick golf back up again...won several local tournaments...only to hit the wall again. And haven't really played since...that's been about 5 years ago.