Episode 202: The 10-Week Year, Trading Competitions and the Process Approach to Trading

by producer on November 13, 2013

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About a month and a half before we reach New Year’s and a time of resolution-making, your host Rob Booker explains how he has moved from the Gregorian calendar to using a 10-week year. So, Rob details his relatively newfound schedule and how it works.

Next we dip into the mailbag and read a hilarious comment from James. Then Anthony from South Africa wrote to ask about trading competitions and whether their winners’ incredible results are legitimately possible. This leads to an intriguing discussion of the reality of making huge profits and how consistently it can be done.

And finally, Rob wraps up this episode by talking about implementing a process — and committing to that process — instead of solely striving for a specific end result. This discussion will become the first part of a three-part series that spans over Episodes 202 through 204 of The Traders Podcast. Don’t miss it!

Links for this episode:

TFL365.com

Rob on Twitter: @RobBooker

The Traders Podcast on Twitter: @TradersPodcast

E-mail us! Producer@TradersPodcast.com

Trader Interviews.com

{ 7 comments… read them below or add one }

dwt November 13, 2013 at 10:59 am

You might have a look at http://www.forexfactory.com/showthread.php?t=56670 for an example of a guy who made crazy profits in a short period of time. He appears to have succeeded in a high volatility market (back when 100:1 leverage was still allowed) by shooting for the moon and succeeding enough consecutive times to hit his goal. And he insisted that this was NOT a long term strategy, but just a crapshoot. Still, fascinating stuff.

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Warren November 13, 2013 at 8:25 pm

Hey Jason, & Rob,

I am glad you guys mentioned traders who use demo accts. I’ve had the same opinion for a long time about demo accts as Rob’s buddy Boris Schlossberg. I think a demo should just be used to learn the software and mechanics of trading, but you have to go live even if you are trading for just a couple of dollars or less per trade. It really has to become real at some point.

Here is the link to Boris’ article I tweeted once.
Tweet: @ fxflow Boris Schlossberg sent this to me. Thx! RT “Demo Billionaires not Welcome” from… http://www.bkforex.com/boris-schlossberg/demo-billionaires-not-welcome/

I also think it is sick that people use demos to sell subscriptions to trade signals and trade recs on StockTwits and Twitter. You think the CFTC would be all over that? And you’d think the SocialMedia sites that deal primarily in StockTweeting would want the scheisters off, but what they really want is no one bringing it to anyone’s attention that they don’t have the time or ability to root out all the hucksters that the regular members see everyday and complain about. Scammers promote their other sites where you have to join and sign up with a paypal account. They always claim to have taken winning trades, but they never gave their entries in real time. I used to love these social trading sites but lately they have become too clogged with snake-oil salesmen. Every time you block one 3 more pop up.

Keep up the good work and I hope pick me for the trader house. But even if you don’t pick me, I am going to excitedly tune in everyday.

Warren

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Scott (fatbeetrader) November 13, 2013 at 10:11 pm

Sounds like a well formed outcome to me
I do something similar over each 3 months with daily targets, but I’m find it too long.
Perhaps i may need to shorten it to 8weeks.

Great podcast guys

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Scott (fatbeetrader) November 13, 2013 at 10:28 pm

….opps pressed submit by accident.

….great podcast guys got me thinking about reworking some of my process and dropping the goals, as like brad I’m pretty consistent over the months but sometimes when I’m having a draw down week or even day i feel the need to break a rule so i achieve my goal,rather than accepting it as part of the process. I cant wait to hear the other two follow up episodes.

Scott

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David Watson November 16, 2013 at 6:29 pm

Love the 10/12 week idea.. Will try it out.

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Brian November 20, 2013 at 9:03 am

Like so many things in trading, what works and what is trude depends upon the context. Although I do believe that all trading is process driven, the Alpha method can and does work, until it doesn’t. Therefore, we hear stories about trading greats who busted, and read books by Taleb about how many trading greats we should expect out of the millions that make the attempt. However, I’ll let you in on a little secret, it depends on your time frame. Just as Suzie Ormand can write books on investing, and sound like she knows something about trading, because she is discussing a long time frame, Alpha traders can make money on longer time frames and appear to know what they are doing. Take any of these gamblers into a day trading context, and they’d blow out immediately. I agree with Rob regarding the 12 week year, and his particular (brilliant) twist on switching between an Alpha approach and a process approach, but let’s be clear, that’s the approach to goals, not the actual trading. If you have financial goals and you let it effect your trading process, you are toast, it just depends upon your time frame for how long the toaster takes to make you a smoking charred wreck. If this isn’t so, and you decide when the market pays you, not the market, then why not take all your trades at lunch and during the overnight session? Because the market decides what it feeds you, and the bowl isn’t filled at regular intervals.

This returns me to my favorite episode where Rob Booker reflects on spontaneity. Rob said something to the effect that he didn’t think anything he had ever done on a whim had worked out, and that if he coud just remove those trades from his journal, the whole bottom line would change. So I guess what I’m saying is trading is about the process, if you leave the confines of that process you open the door to disaster, and what seems to work on higher time frames is obscured by probability and a lot of market baloney.

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Brian November 20, 2013 at 9:10 am

Another point I left for this PS was that process is what gives you reliable data. If you wing it, you not only transform the trade from a statistic into a struggle for survival, and therefore open the door for your ape brain to take over, you also make that trade irrelevant to your process. How are you ever going to make any progress if you can’t measure progress? Who the heck has the money to waste on irrelevant scientific tests? Every trade has to follow the system so it fits into the mosaic with which you will test the system. Combine that mosaic with what you expected from simple probability, and you begin to get a clear picture over time.

Unfortunately, most traders don’t approach the task with even this basic understanding of what they are doing, and sometimes jettison perfectly good systems as they flit from one approach to another, looking for something that “works.”

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