July 27, 2010 - It's Harder Than it Looks

Featured Trades: (THE HARSH REALITIES OF TRADING)

3) It's Harder Than it Looks. A recent piece at the underground website, Zero Hedge, by one 'pivotfarm' resonated with me in explaining how hard it actually is making money in the market (click here for the link). It looks deceptively easy from the outside. You buy a share, watch it go up under its own power, and sell for a profit. How hard is that? This is why the securities industry has such a long history of attracting those interested in shirking hard work, aspiring to get rich quick. If you do encounter those with new found fortunes, they usually stole it. You want to run a mile from managers touting perfect track records, as they are usually fake. The reality is a little bit harsher. The author lists the great lengths that the pros go to insure success, including endless education, iron clad self discipline, and independence of thought. He refers to New Yorker writer Malcolm Gladwell's insight that if you look behind the scenes, success can usually be explained by unbelievable hard work (click here for my 'Evening With Malcolm Gladwell' ). I draw these simple analogies for potential traders. Just because you like listening to music on your car radio doesn't mean that you can compose Beethoven's Fifth Symphony, reading the Sunday papers doesn't bestow on you the gift to write Tolstoy's War and Peace, and watching weekend movies doesn't turn you into Steven Spielberg.

Potential Trading Wizards?

Legal Disclaimer

There is a very high degree of risk involved in trading. Past results are not indicative of future returns. MadHedgeFundTrader.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles and all other features are for educational purposes only and should not be construed as investment advice. Information for futures trading observations are obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the information. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein. Affiliates of MadHedgeFundTrader.com may have a position or effect transactions in the securities described herein (or options thereon) and/or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies.