I think this trader hates me.
Although most of you know I am an emotionless cyborg, I’ll admit this email got my blood boiling just a bit (I’ll have to check my programming for viruses).
That hurt. There is so much I could say to this guy about his negative attitude, an attitude that rarely leads to “winning”.
Nevertheless I responded kindly.
Here is what I wrote back after editing out all of the four-letter words before hitting send:
I understand your frustration my friend. I feel it too. But remember as a trader you need to focus on the long game. At the end of the day short term results are meaningless.
After years of trading I know drawdowns are an unavoidable part of the game. You see, we are playing probabilities and even if you have an amazing 75% win rate, you will lose 25% of the time. Unfortunately, those losses don’t come in a nice and tidy 3:1 win rate. Sometimes you will have 5 or even 10 losses in a row! As a swing trader that could lead to a two or three month drawdown.
Don’t get too emotional about it. Trust the process and results will follow.
Know that if you study your trades, follow a strong process and make minor adjustments according to the market and your own trading leaks, that drawdown will eventually turn upside down. My own biggest winning streaks have almost always followed drawdowns.
Trading is easy during when things are going good. What separates winning and losing trades is how they handle draw downs. That’s when the “mental game” comes into play and traders lose discipline. Head these words and you WILL become a winning trader.
I never received a response back, but sincerely hope this response helped (even if he still hates me).
Remember, during your next drawdown put the “drawdown plan” into practice.
- Stay calm
- Trust the process (as long as you have a good process)
- Don’t get caught up in short term results (think long game)
- Analyze your trades and make small adjustments as needed
Stick with it though the drawdown and there’s a good chance the drawdown will “bottom out” and lead to a big win streak.