I recently read a biography of Warren Buffet and it reinforced a thought that people who achieve the highest levels of success in their chosen fields have several important attributes in common. I don't mean to arrive at a judgment whether they are "good" people or "bad" people, only that they seem to share the same qualities in rising to pinnacles in specific categories. For example, just because a man becomes a great athlete or great statesman does not necessarily mean that he is also a good husband or father although he may well be. I only intend to look to those qualities that seem to coalesce with regard to the specific area in which a person has attained greatness and suggest that those same qualities are important in becoming a good, better, or even great trader.
The qualities I see that seem to be most important are (not necessarily in any order) passion, focus, determination, the creation of a plan, and patience, and some form of giving back. Is there any doubt, for example, that Tiger Woods on a golf course is focused and determined? Obviously he is passionate about the game as he has devoted his life to becoming the best there ever has been at golf. He demonstrates patience in that he rarely does anything foolish to try to force a result, but, instead, takes full advantage of opportunities once presented.
If we apply the same characteristics that Tiger has on a golf course to our trading is there any question that we are not likely to become better? I don't mean to suggest that each of us is capable of such passion, focus, determination, patience, etc. but only that an increase in those areas is likely to lead to an increasing chance of greater success. If we look at the flip side, how likely are we to trade well if we don't have a plan or if we fail to focus or try to force trades through impatience?
Recently in response to a questionnaire I sent to a prospective coaching student I received a reply that he enjoyed nothing about trading and considered it a necessary evil and something that he had to do. I replied saying that I thought he should reconsider the idea of retaining me to coach him because I believe it is essential to have passion for trading in order for there to be any likelihood of success. In my view that approach is true in almost all endeavors. So many of us go through the motions of life without a love for what we are doing and, at least as a partial consequence, may never rise to the heights we are truly capable of reaching.
I discovered trading relatively late in life, after age 50. It grabbed me and I have been passionate about it ever since. When I began, I had no other source of income, and not a lot of money, but I knew it was what I wanted to do. I studied trading at least six hours a day and often more. I loved learning about it and it became my focus. Even today, after many years of trading, I continue to study; I read, attend seminars, watch DVDs and do whatever I can to add to my trading knowledge. I do those things because I am passionate about trading. I do not contend that I am anywhere near being the world's best trader, but I continue to try to be and I know that requires effort. For me, trading is fun and the effort well worth it.
While it probably is not necessary to devote as much time and energy as I have to be a success in trading, I do believe it is necessary to have passion, focus, and determination to succeed in the business of trading. Patience may take a while as it did in my own case. In later articles, I'll try to discuss each of these characteristics in more detail as we continue to try to elevate our chances to succeed as traders and investors.
I hope you have a wonderful Independence Day and realize that an ability to trade is one of the wonderful things that can, indeed, let us be independent.
by Bill Kraft, Editor
Copyright 2009, Makin' Hay, Inc.
All Rights Reserved
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