BarroMetrics Views: Do What We Know
Dom’s comment today (http://tradingsuccess.com/blog/fulcrum-trader-2130.html#comment-5936) emphasizes again that there are two distinct elements for any success, but especially trading success.
- Know what to do
- Do what you know
When I did my due diligence on Chris Koozekanani, the feedback was he had something genuine to offer. I took the course and did find some original ideas. But then, he appears to have struck some difficulties, and failed to honour his commitment to me. But, his conduct in no way changes my opinion of his method.
Now Dom tells us of his experience with Chris’ trades.Chris failed to do what he knew.
Dom’s story illustrates what is wrong with so much of the hype that surrounds our profession: it often centers around having an advertised plan that bears no resemblance to reality. ‘I turned $1000 to $100,000 in 6 months!’. Even some courses that otherwise promote what appears to be a reasonable plan foster the belief that 100% pa return on capital is the norm to be expected.
The problem with these unrealistic expectations, especially for the beginner, is: they spend their time chasing rainbows. The reality is to succeed, we need to apply what we know, and we need to manage our risk so as to maximise profitability while minimizing risk of ruin. These goals require we put in the right kind of effort to become as successful as we can be. Any fool can make his track record look great when his trading is in flow state – when all he touches turns to gold – the trick is to remain as profitable as possible when in ebb state (when all we do turns to a loss). That has to be our aim.