The end of the experiment is here. I am both glad to be done and in the same exact moment, I will greatly miss the reason to sit down and write about life and trading every day. When I set out on this journey, I really didn’t plan to write so much every day. I would never have thought I had that many words in me. Here it is, day 40 and I am still writing… The entire experiment is over 20,000 words. My high school english teacher would be shocked.
First of all, thank you to everyone who read these posts. I met new people who are on the same path I am trying to travel that leads to better ways of living this life. @spacepip thanks for the videos and conversation. @lavertrade awesome input and ideas. Rob Booker and Matt Lacoco you guys are awesome. Thanks for the life changing text conversations throughout.
Why did I do this?
In all honesty, I’m not even sure what possessed me to start this. The best I can come up with is I wanted to trade for a living, I couldn’t do it, and so I wanted to shake things up. I wanted to force a change and force my hand. The definition of insanity is doing the same thing over and over and expecting different results. Unfortunately, that was my trading. It was insanity. Over trading, undefined and untested systems, stress from expecting an overwhelmingly good outcome from entirely underwhelming effort.
In short, I was an amateur, and I was immature
If you read back through these posts, I think those two words were used quite often. I am not certain because I can’t bring myself to go back and read anything I have written. Weird quirk but I hate listening to myself or rereading what I write. But I know that as I think back on the entries, those two words stick out.
Immature: “Having emotional or intellectual development appropriate to someone younger” ouuuuuch… I can’t really deny it though. I have great conversations with a good friend about what it means to mature, to face the world in a different way than we are used to. Deny the old dominant thoughts that things should be easy, that good should come without a fight, and that battles can be won without sacrifice. To mature is to leave behind childish ways of looking at the world. Let me make one distinction here. This is not cynicism. “The world sucks.” My broker and my boss hate me.” and its all their fault that nothing good has happened for me.
Amateur: This idea wholly belongs to Stephen Pressfield, my now favorite Author after finding his work through a Raghee Horner tweet.
Side note: this happened to me twice in this experiment. First I found “Turning Pro” from Raghee’s tweet and then just yesterday I found the “Secret Life of Walter Mitty” trailer by complete accident. I truly believe that fortuitous events happen to those that are looking. If I never would have been traveling this path, those two pieces and countless other articles, videos, and quotes never would have crossed my path. Take the first step and see what you can find.
So back to amateur. Here is what Pressfield has to say about being amateur and what it takes to turn pro
“When we talk about the switch from the mindset of the amateur to the mindset of the professional, we’re talking about a total, fundamental, life-overthrowing revolution.
“The amateur is in the habit of yielding to Resistance, just as the alcoholic is in the habit of taking a drink. I can’t prove this, but I would bet the farm that the chemistry of the Resistance-addicted amateur’s body is as deformed as the physical chemistry of the heroin addict’s. To change, he has to alter that chemistry. And he has to do it by will power alone.”
“I turned pro myself because if I hadn’t I would’ve died. I couldn’t stand myself for one second longer or endure for another minute the wasted, pointless life I was living. Like the Peter Finch character in Network, I had run out of bullshit. Otherwise I never would’ve found the courage. It was too hard. Too unknown. Too terrifying.”
“The good news about turning pro is it’s free. You can’t be excluded. No one can turn you back at the border. The act is self-initiated, self-sustained, and self-defined. You turn pro in secret. Not even the NSA knows you did it. But you know. And I’ll know when I look in your eyes. I know how hard it was. I know the price you paid. I know the guts it took. I know how scared you are, and I know how weird and alone it feels. I salute you. You are one in ten thousand. You have done what many, many talk about, but damn few actually do.”
Just rereading these quotes from that article get my blood pumping. I couldn’t stand myself for one second longer or endure for another minute wasted. That pretty much sums up why I did this. I wanted to turn pro, I needed will power and determination I didn’t think I had, and couldn’t stand another second of not taking steps to change.
So I Started it…
I began this journey thinking that I could expose my trades to anybody who would look and listen and spend my time talking about systems and backtesting and indicators. I wanted to prove myself out. I wanted to validate the thesis that if I traded successfully, I could somehow validate my days and desires. I hoped this would propel me from money loser to money winner. I hoped I could skip over all of the really hard stuff and get right to the victory dance (which you DO NOT want to see by the way). Well, if you have read any of the past post’s you know that just didn’t happen. I went down the rabbit hole, or as the matrix put it, i took the red pill. I decided early on, at resistance point, that I didn’t ever want to resurface as the same person. I couldn’t. I didn’t even realize it but I was about to learn things like self control, discipline, willingness to be ordinary, and how to live with the tiger and not to kill him before the word “success” could even enter my vocabulary.
So instead of using this forum to discuss trading, I used it to expose my journey as really just a guy, through the lens of trading. I set out to talk about my actual trades every day but after a couple of days, I found it so uninteresting. Let me say that another way, I found myself wanting to change my bad habits, my amateur behavior, and my dominant thoughts of lack and loss and replace them with the things I really wanted to be, and it all happened just because I wanted to be a trader. From immature wild expectations of everything in life to a controlled expectation of hard work.
So What Changed?
Almost all of the preconceived notions about trading I came into the experiment holding have been put through an examination, whether I wanted them to or not. Here is a short list of the specific ideas and practices that changed because of this journey:
1. Trading frequency- When I started this, I was a classic over trader who was unable to stick with any position. I wanted to trade, and traders trade right!? They push a lot of buttons and make money very quickly and price never works against them… ever. I wanted to be in the market, but didn’t really know why other than I knew that if I wasn’t, there was not chance of me making money. ahhhhhh there is the key word. Chance. If I was not in the market, there was no chance of me making any money. For the most part I left it to chance. Chance entries, chance stops. Everything about my trading was a surprise. It was an endless loop that needed surprise to win eventually, I just had to weather enough bad surprises I guess.
That is not the case any more. The experiment helped me to train my reactions, to form new habits. I haven’t taken a trade in weeks that wasn’t apart of the plan. No more jumping in and out and looking for surprises.
2. System- In the beginning, I had an untested system that I could not look anyone in the eye and give an answer for the question “what is the reasonable expectation for your system on a weekly and monthly basis?”. I learned throughout this process that that is one of the most crucial questions to ask and answer if I am to achieve any lasting success in the financial markets. What is the reasonable expectation for my system? And can I be held accountable for those outcomes. No bending the rules because I feel this need for money. No switching the rules because I am afraid that what I created doesn’t work after it has been tested.
Now, I have set rules and I am currently in the middle of the process of identifying my “monthly reasonable expectation”. Most of my trading is now done by the robot I created. I defined those rules and tested them. Why would I not use it to my advantage? I also talk with my wife about it all the time and we are working to treat the trading P&L the same as we would with any business. No more room for surprises…
3. Strategy- Eight weeks ago if someone would have asked what my trading strategy was I would have looked at them and been like what the hell are you talking about? My strategy is to win and make money… What I didn’t realize was that this was not a strategy but an outcome. Strategy is what plan I am going to put into action to reach that desired outcome. It can involve only discretionary trading, it can involve discretionary and robotic trading to get to the goal, and it can even mean both of those plus doing another job until a strategy without the extra job can be defined if so desired. Strategy is not something that needs to fit into a certain mold or box, but once defined, needs to be molded and not changed until the desired outcome is reached.
My strategy now involves proper lot sizing always. No exceptions. It involves discretionary trading, robots, and a job to reach my needed outcome right now but the strategy also addresses what it will take to not have to use all of those things to get to the outcome every month.
I am going to keep this to one idea. I turned pro. Not just in trading but in so many ways I would have to write a real book to explain them all. Defeating resistance, doing whats easy, making a plan, defining the process and then adding tons of discipline to that process. I could literally write an entire book on the things I have learned about life because I did one simple thing, I made a real effort to change it.
Surprisingly, I think Life of Pi was my favorite movie I watched during this time (see day 14). The imagery of the tiger as the self he had to conquer was very powerful for me. He had to face himself on that boat in ways that most of us probably will never have to. To learn to live with that side of us. The untamed strength that Richard Parker represents is what can make a person dangerous and needs to be reigned in, but we should never try to kill the tiger because all greatness needs those exact same qualities.
SO NOW WHAT….?
So now what? I keep asking myself this question. I believe that if you had known me 40 days ago, and we got together tomorrow in some coffee shop and shared a good cup of coffee that you would see a difference in my eyes, the difference Pressfield talks of. It’s just a glance between those who have made the transformation. Those that have walked through the fire and have allowed themselves to be melted down and reformed,
Trading is different now. I want to let the robots do their work. I don’t have to be in control. The perspective on life is very very different now. I can’t go back to old ways. I would be lying if I told you I was going to go back and try so much harder at being a better trader now and I am going to quit my job and trade full time. We say that like it’s important. That’s like me saying I am going to quit my job…. and go get…. another job! No crap. That is a reasonable expectation I think. A job is a job and now that I have most of the trading stuff in perspective, I can do it, and move on. Be super successful at it and in the same breath never care about it again. Why?
There is a greater adventure
There are adventures where we make life better for those around us. Adventures that are not so self absorbed because that is no adventure at all, it is just boring and utterly unfulfilling. There is purpose and meaning and the ability to change things for the better.
So… I am off to find that adventure. I am looking for my helicopter to jump in so I can go do something incredible.
Thank you everyone, I have so much enjoyed this journey with you… I will continue to write once or twice a week, hopefully about the new adventure.
Shonn Campbell “Trading Experiment 2013”
P.S. no matter when or where you read this, I would love to hear from you. firstname.lastname@example.org or @plateautrader