Now, I know that this is Nike’s trademarked saying and I hope they don’t come after a little trader like me but maybe, just maybe they were on to something when they choose this. (If you are interested, here is the story behind the tag line)
Just Do It
This is much different than the tagline I would give most traders including myself sometimes which is
Just Figure It Out
Do you see the insane difference between these two phrases? What does Just do it say? Go get it done. You have confidence in the preparation you have put in. You know your stuff. You are ready. Now Just DO It. No more thinking, lots more doing. Just figure it out says something completely different. You are not ready. You are not prepared. You should spend more time thinking about this problem because the problem is huge and you don’t have every piece of information you need to make sure that this problem is solved perfectly.
Of all of the traders I have talked to and maybe more because of my own experience I can safely and confidently say that there are more “just figure it out” traders out there than there are “just do it” traders. What do I mean by that?
I have spent too much time trying to figure it all out. I am a bit of a perfectionist and I hate risk. (So that’s a bad combination for a trader by the way. Just in case you didn’t know)
I’m not talking about fundamental analysis. Figuring out what the underlying economy of a currency is doing is probably pretty important, but doesn’t really ever translate into a five minute chart. That’s cool. Spend some time figuring out how interest rates and bond yields and economic production play into a country’s currency. But never think that figuring that out will give you everything you need.
Also, I am not talking about figuring out your method or your edge or whatever you want to call it. Put a ton of time into that in the right way risking very little of your capital but put in the work. That work may be the most important work you can do. How do you trade? If you can’t tell someone that in one sentence, you don’t know yet. What is your risk? If you don’t have that defined, this is an infinite loop game still that you can just keep depositing quarters too keep playing.
What I AM referring to is the point when all of that is done. That point you reach when you have to look at yourself in the mirror and realize there is nothing left to figure out. You know as much or more than anyone out there about your trading style and how to give the markets context and what you want to do every day.
This is the magic moment when “just figure it out” flips upside down and it’s a wast of time. I think this is what’s meant when referring to the law of diminishing returns. Trying to figure it out will only stop giving you a return and actually start to erode your productivity.
What stops us from making that switch at the right time?
Plain and simple. Resistance at it’s finest. Right when you are about to do your best work, you encounter your biggest problem and it wants to direct you back to the drawing table and the just figure it out loop can continue. But that’s the wrong move.
How do we make the switch?
Let me be honest, there is only one way to do it: You must step out onto the edge and most of the time you will just have to jump. Trust me, it’s not what a perfectionist control freak like myself ever wants to hear. You want me to what? Yes. You must risk life and limb to get to the place you want to be. No great accomplishment was safe. No great victory came easy.
The Wright Brothers
I don’t know why but I am thinking about the Wright Brothers as I write this. There are a million more examples of this but for some reason they are on my mind.
Think about all of the work and effort that went into making that first airplane. The hours and days and years and money and risk that went into just “figuring it out”. That is amazing stuff, to create that kind of technology and be a pioneer in a given field.
Now think about this: They could have stopped there. They could have created the modern THEORY of flight and left the actual flying to someone else. They could have stopped at “well, we figured it out”.
But they didn’t. They flew. They took everything they worked on in the “figure it out” stage and took the risk and moved into the “just do it” stage. I laugh as I sit here thinking about the rock paper scissors game that went on between the two of them for who would actually fly it. Probably didn’t happen but in my mind, it’s pretty funny.
So as I right this I bet there are two camps out there right now. The first camp risks without control to play the infinite game and just wants to deposit more quarters to keep the game going. The other camp has spent an amazing amount of time figuring it out and now has everything they need to take the leap but can’t because the risk is too great. Or maybe your a mix of both. I don’t know.
Here are my two steps to figuring this out and getting past it in your trading:
- Put together a plan. This is the figure it out stage. Understand it. Write your trading plan down. Make it simple. Risk very little real money on it.
2. Just do it. The exhilaration of following through is one of the least know highs a person can find. When you get to say “I did it. I followed my plan. I put an idea into action.” That’s the reward. The circumstance is not the goal here. The action needed to just do it is the win, the reward, the eternal take away.
Figure out where you are right now. Do you risk stupidly? then stop it and figure out a plan. Do you spend all of your time trying to create the perfect plan? Then stop it and find the way to be the person that gets to the edge and puts in the work and takes the proper risk.
Making money is not the true measure of a good trader, how well do they execute on their plan, that’s what separate’s the truly successful from the dabblers.