Thursday, May 03, 2007

One Habit is Not Enough

One Habit is not enough to make you a Highly Effective Trader.

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Just in case you haven't noticed by now, my blog is cluttered with futures charts, trades, and reviews. It could be interpreted as an obsession with futures trading, but I prefer to think of it more as a passionate committment.

Today, I had one of my best days since I started trading futures, and it was a reminder of why I am doing this. I am passionate about trading, even despite the previous slumps that I went through, and the recent "tuition" that I've paid to learn how to trade futures. I have such an undying thirst to become better, to perform better at trading, whether it be futures, options, or equities. And this passion is the fuel for my committment to become that better trader. So for me, practicing the habit of being committed every day is easy.
However, what I have learned is the somewhat obvious point that committment to the vocation of trading is not enough to become a Highly Effective Trader. Becoming a Highly Effective Trader is about practicing all of the 8 Habits, not just one. In fact, I am beginning to see that the 8 Habits are interdependent with each other.
For example, without a sense of committment to your vocation, all the patience in the world will not help. Or, without practiciing discipline, all the committment in the world will not help you. Without a sense of self-confidence about your trading performance, you will find it harder and harder to begin with the end in mind. And without practicing all of the habits, you will find it hard to maintain your sense of self-confidence.
If you are weaker in one of the habits (like I feel like I am weaker in practicing the habit of patience), then it will tend to drag the other habits down with it. For example, a lack of patience will negatively impact trading performance, and that will negatively impact your self-confidence.

So, it is not just a good thing to practice all of the 8 habits of the Highly Effective Trader, but also a necessity.


john said...

congratulations on the great day!

i need to print a copy of the 8 habits

john said...

btw, can u post all 8 of them? thanks in advance

Phileo said...

Hi John,

My article on the 8 Habits of the Highly Effective Trader is located in the "Best Of" Tab, check it out.