How Many Tools Do You Really Need In Your Tool Belt?

I began with simple systems. I got smarter and made complex systems. I got even smarter and now I trade simple systems.

– David Stendahl

It has always been my belief that you only need mastery of a few trading tools to be very successful in this market.  Most would be traders are completely incapacitated by this false notion that in order to trade for a living you have to accumulate a vast amount of knowledge and tactics over the years.  There is this belief that in order to be the best you must master not only one way of doing things but several ways of doing things.  Not only is this not true, the exact opposite is actually closer to the truth.

I have seen this ideology destroy so many new and aspiring traders.  There are a lot of services out there right now.  Some are predatory and/or teach bad habits, many are just plain bad and are the ruination of many aspiring traders, and a very few are actually very good at what they do.  I’m not writing this to cast stones, but to illustrate a point.  Traders are always searching for the Holy Grail.  They are looking for a system or design that gives them ultimate and instant success in the market.  They want in other words; a winning lottery ticket.  So many traders wade through system after system.  I have had traders who find their way to me and do very well with my system and see that it does indeed give them an enduring edge in the market.  However at the same time, they may have found another service that possibly trades a different vehicle:  futures, options, cryptocurrencies etc.  Or perhaps there is something about another service that seems to work and appeals to this aspiring new trader, even though they realize my system gives them an enduring edge.  Herein lies the trap that they get themselves into.  I don’t think a new and aspiring trader realizes the obstacles that I have had to overcome to get where I am today.  I don’t think they realize the tuition that I have had to pay in this market – my cost of success – and that it has taken years of experience to get where I am today.  The same is true I am sure of other individuals who run a successful trading service.  It is folly for the aspiring trader to think that he or she can be smarter or better than both of these individuals combined.  But what does the new trader do anyway?  He or she thinks that they can be a member in multiple systems, and master the best of both, and combine the best of both, so that they can have more tools in their tool belts and thus have better mastery and success in the markets.  Again, the exact opposite is closer to the truth.  Why?

Because varied market experiences, if not utilized and interpreted correctly, help to crystalize inaccurate beliefs.  To put it bluntly, the aspiring trader bites off more than he or she can chew.  Knowledge is power, but only if it is the right knowledge.  It only takes two or three workable techniques within a simple system to rise to the top of this game we call trading. Instead of getting the best of both systems, the aspiring trader spins their wheels and makes mistakes or takes losses going back and forth between each system.  When I speak with traders who need to take a break, or who blew themselves up, I find that it is not something that I did or that my system did, but that they freely admit that they were in multiple services and did this and that and it ultimately led to their ruination.  You can’t master one system alone if you do not fully embrace it.

The best traders are minimalists.  They find a tactic or a system that works consistently.  Once they have found them, they simply implement them over and over and over again.  Repetition really does have value.

So stop searching for the Holy Grail. The Holy Grail after all is you.  It doesn’t have to be MY system, but find something that works for you that is consistent and gives you an enduring edge, and then implement it over and over and over again.  Do not try to do too much.

6 Comments - Leave a Comment
  • Max lyon -

    Awesome article! Very well said and something I know many people do (including myself) when trading for the first time.

  • Colin -

    I have been practicing Brazilian Jujutsu for over 10 years and find that top level practitioners master and use the same basic moves over and over and over. Basics keeps me alive against faster smarter younger stronger and fitter opponents. I don’t see the market any differently than BJJ.

  • Will Etherington -

    Well said. I joined your service 1.5 years ago and left shortly after because the gains were so small for me; however, I was foolish as I had such a small account and was looking to make it big over-night. Your system is truly the best out there, the amount of knowledge you and the rest of the WC family has is amazing.

  • Zach Murphy -

    Great post Professor! The market provides many ways to be successful but mastery takes focus on a single process that you repeat the same way every time for consistent results. Every new piece of information good or bad will be confusing at first. Learning your method that has been tested and focusing on it until mastery is so much faster than creating your own. Looking at more than one will always cause distraction and confusion on the path to mastery.

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