Hey guys, welcome back to the segment that Mike and I do weekly where we answer your guys questions, comments, and see if we can add anything onto it and just go over topics in general. I wanted to start today by saying make sure you guys like subscribe, click the notifications bell, all comments, help the algorithm, and we may answer your questions in a dedicated video and you can go ahead and talk about the course. I’ll cut this part out,
Yeah. Yes. And we dedicate this show to you, our loyal fans and newer folks. Welcome to the show. I did get a few questions via email. I guess folks wanted their privacy. They asked about enhancing their mindset. I’m not big on marketing and advertising, as you can probably tell. I do a daily show, and the most I ever say is you can get a free download for the audiobook version of Inner Voice Trading, but we actually have a mindset course. It’s 12 weeks. If you liked anything about the book or the show and you’re struggling or you want to get your mindset to that of a pro level so you can get pro level results, we have, it’s a 12 week program, eyeline self-study. So you can do it at your own pace whenever you’re available. It’s a lesson a week. You can’t jump ahead.
There’s nothing to download. It’s all streamed inside the platform, the learning management system. And it’s the feedback that I’ve gotten from many people is that not only did it help their trading, but it’s really helped them change their outlook and improve their lives. So if you’re interested in that, there’s a link below. You can check it out. That’s one way to help the show. As Brandon said, our beloved ganja, please like and subscribe because we get really good data and we don’t want to sit around and talk about stuff that you don’t care about. So far we’ve been dead on, but we do a good job of listening. So it’s not terribly random. We listen to what your concerns are. We actually read the comments and the questions and it’s very, very important. But as far as I’m concerned, if mindset is your issue, there’s no pl better place in my humble opinion than to start there. Some folks need one-on-ones or what have you because they have bigger issues. And it depends what kind of student you are. Admittedly, some folks do very, very well with self-study, but check it out and then reach out if you have any questions.
And we got a lot more stuff coming on the education front, and I think it’ll be really exciting and really helpful for you guys. And with that said, let’s get into today’s topic. And I wanted to expand upon something that we talked about the last week’s episode, and that’s mindset and tilting. And I wanted to bring in a concept for my world and kind of get your take on it as well and see how that kind of applies to trading. But basically we talked about how the market can be really undesirable and death by a thousand paper cuts and how that can be wearing and mentally fatiguing for some people. And everybody kind of internalizes that differently. And I wanted to tie that into something that I do, which is the professional video gaming front and you know, have to cue matchmaking. And matchmaking is random.
You get random teammates and sometimes they’re good, sometimes they’re bad. So the odds are not always in your favor, but they can be. And basically what happens is somebody starts their day, they play one game, they have a really bad game, and then they’re pissed and they’re just a complete jerk for the rest of the day. And then they do tilt queuing and they’re just losing their rank. The rank keeps going down in the hole and they just turn into this evil, nasty person, really, really not nice. And I think that tied in a little bit to what you were saying about the internal struggle with trading and how that can affect you and you should just really take a break and go golf in Puerto Rico for five days. And I just wanted to see, see what else you had to say on that, if anything at all.
Yeah, I mean I think we’ve all seen it. When folks go on tilt, they’re imploding and it’s not pretty to see, unfortunately for many people when it comes to trading, if they blow up and they lose all their capital, they’re kind of done for a while, then they need a, which is interesting because intentions equal results. So if you don’t deliberately take the break that you need that everyone else can see that you need, if you keep trying to bull your way through and you lose all your capital, you’ll be forced to take that break. So as I tell you, and take some time off because you’ll preserve your capital, come back with a fresh head and perhaps a fresh perspective on things. But ultimately you end up in the same place. So you might as well do it on your terms. People don’t care if you’re a martyr and people certainly don’t care if you’re a victim.
Those are folks who are kind of insta block because to me it’s like what’s going to happen when you put on trades ahead of time? So that makes no sense to bitch and belly ache about the outcome of any one particular trade because no one trade is any more important than the next one. They’re just waves to surf. That’s it. You’re putting on risk, you have no idea ahead of time. And this is something that I’ll say after 35 years of doing this, I can certainly say, cause I’m a human being, which just means that we’re emotional beings. Unless of course you’re catatonic or you’re on drugs and you don’t allow yourself to feel anything. But that’s awfully difficult to have a good life with. That is that I’ve had hunches, I’ve had clairvoyant moments where I could kind of anticipate people’s behavior, but for the most part, I can’t say that I was able to anticipate or see any particular trade in advance and knew it was going to turn out to be one of, say, my top 10 trades. You don’t know that ahead of time. The best you can do is put the trade on and stay out of the results.
So that’s where my mindset is. It’s very placated in understanding that this is just a process. And over the years I’ve been able to get this eliminate stuff, not add crap. Of course I’ve got a million books, most of them I’ve read, some of them were sent to me. But the thing that taught me most about trading was my actual doing it. That’s why I tell you to do that. Can’t make any money with that. The broker dealers can’t sell you mindset stuff because there’s no money in it. They have to sell you advanced charting packages, duh. Right? But if that was really important, why would they have to replenish their client base every six to nine months? Because active traders who don’t have the right mindset blow up, lose their money, they become discouraged, they quit. They feel the system is rigged and it’s not because you are the system. And so you might as well sit and learn and study your own behavior and learn from it and then see how you can have compatibility with the market.
So that’s what I try to focus on is where’s my level of compatibility? Because it’s like dating or being in a relationship if two really good looking people meet, but there’s no chemistry, probably not going to be a second date nor there of relationship. So you have to kind of have that same type of chemistry that you have with your best friends and mates and whoever you are involved with romantically if you are, you have to have that type of chemistry with your behavior as it relates to trading. And when you don’t have that, you’re kind of just asking someone if they want a cup of coffee. And so it doesn’t mean it can’t evolve into something, but that’s how I look at losing trades. If I say, let’s go grab a cup of coffee and she says, no, I’m not interested, or I’m busy or I’m with somebody, to me, I still won.
Why? Well, because I stuck to my system and I asked the woman for a cup of coffee, whatever it might be, probably not the best analogy, but you got to be in it to win it. You have to put risk out there in order to get return. And if it’s dating or asking for sales, you’re going to face rejection. Now, there’s ways to work with the rejection, but for the most part, no means no. Right? That’s a good boundary to have. And every play date has a beginning of middle and end and the door prize, you get what you get and you don’t get upset. See, all these parenthood sayings apply to trading, but does that kind of hit upon going on tilt?
Yeah, I had a bit of a follow up with that too. And it’s like people, it’s easy to say don’t be emotionally involved in the results, separate yourself. But yeah, I kind of wanted to ask you how you do that, but before I wanted to talk about how I stopped tilt queuing in this game in particular because you, it’s like chess, right? It’s like an ELO system. You have to maintain a certain level of ELO to be in a specific category of rank. And it’s hard. It’s really hard to be at the top level. And what I started noticing is obviously in this game you’re communicating with people, and I would do little things that it was almost subconscious. The way I would ask for things or the way I would say things I could tell would kind of come off a little rude. And I didn’t understand that at the time, but I stopped, I became really emotionally analytical as to how I was approaching these situations and why I was coming into the same result of people firing back at me and being really angry. And then the whole game was just like toast. And so I really sat down and I was like, okay, well here’s where it went wrong. What can I do differently the next time? Yeah. And I kind of wondered, did you have a similar process for trading? And where is the point where you say, all right, I’m not going to pay attention to this or, and even how do you do that? How do you not pay attention to it?
So I think when you talk about going on tilt, the things that can destabilize you as a person in the marketplace is when you have either a gigantic win or a gigantic loss. People mostly associate going on tilt with losing money. But you got to remember the people out there have, the psychology of the trading world is very complicated. There’s some people who are starving for attention and they love drama and they do this because they want attention. So they put themselves in bad spots to lose money so they can stay at the center of attention as opposed to just putting on risk, managing risk and making money in a very low key way. I think when you don’t care about status or your ranking, because you talked about E L O and this and that electric light orchestra, obviously I don’t know what E L O stands for, but the point being is that if you don’t care about status, then you really don’t have to worry about making or losing money on any one particular trade because unless you’re in the bad habit of having to post everything on social media about your trades, which I don’t think really helps anybody you know can say, instead of looking for that, those dopamine hits on the vanity metrics, which is what they are, the likes and the retweets and stuff.
I mean, I appreciate everyone’s feedback, but ultimately I know my worth and obviously this isn’t terribly retail, so it’s not going to have 1,000,005 followers, so I don’t care about that. I think this type of stuff is for those that want it, not those that need it. So to avoid going on tilt, I kind of have worked out all the potential outcomes ahead of time in my brain.
Now with stocks and futures, they’re a little bit different. You have limit moves and circuit breakers and this and that, but typically you learn the hard way that if you go after this ego fulfilling career kind of trade, when you flip the coin, what happens when it comes up tails? Because yes, you might put on a trade where you can make 60% as a rate of return on your overall equity, but for what purpose? How does that serve you? And if it comes up tails, what kind of damage are you going to do to your equity? Because I can share with you, there’s an actual equation that you can use to calculate the risk of total ruin, which means you blow up. Now the blow up can happen because you literally wipe out your account. Or two, you’ve just lost so much money that you’ve become destabilized and disgusted with yourself.
Nevermind the markets that you just stopped trading, right? Because you’re stunned. You never thought it could happen to you. This happens of course to folks who don’t put in protective stops. So to me, there’s enough out there in the lexicon of trading of what not to do in order to stay in the business for as long as possible. Because despite what you might see, this is a marathon. And I think if you come to the ta, one way that you can go on tilt is if you show up to this fight with a sprinter mentality, when we all know that it’s a marathon right there, there’s incompatibility between yourself and the market, and that typically doesn’t work out all that well. It typically works against the trader because you’re not going to muscle the market, not no chance. There’s no chance. So I kind of feel from a meditative standpoint, you can sit back and think about putting on a trade.
There’s really three things that can happen in varying degrees. You’re going to have unrealized gains after you put the trade on. You’re going to stay at breakeven function of time. What’s going to happen between now and the next several moments in terms of the price right now, you can stay in the trade and it can continue to leak against you, presuming you’re long and you’ll have your protective stop in, you can get knocked out. You never adjust those prices. Know what the point is ahead of time, put it in there and figure half the time you’re going to get knocked out. Some of the times you put on trades, there’s an enormous amount of buying pressure where you’re getting in. There’s a lot of slippage in skid, and next thing, your portfolio could be up 2% within the first 30 minutes of putting on the trade.
That happens too. So what’s your behavior going? How are you going to behave when that happens? You can work this out ahead of time. All wars are won before the battles are fought. So you should have that scenario worked out as opposed to sitting there kind of trying to figure it out on the fly, which when you’re newer is very difficult to do because you don’t have your instincts honed if you even have any instincts. And to me, the pros kind of know what place to call so to speak, not what trades, but how to handle their behavior when certain scenarios unfold. Then there’s the other magic trade, and that is, well, what happens when you pull something at 50 and after three days, it’s kind of like 49, 90, $50 and 10 cents. So you can employ what we call a time stop because you haven’t made any money, you haven’t lost any money, but whatever you thought was going to happen after you put on the trade after several days hasn’t happened.
So you can typically remove the risk and just offset the trade at no gainer, no loss, because you always have downside. And if momentum stalls, momentum’s, very, very important for traders of all shapes and sizes. And if momentum stalls right after you put the trade on, in my opinion, you can test this, but most of the time it’s going to work against you. So I just typically get out if that’s the case, doesn’t happen all the time, but when it does just say, okay, well look good on paper, put the trade on according to my rules. But I think the main thing is that you can validate yourself as a trader by can you follow the same process day after day after day? That’s what makes you a trader. Being profitable is something that you’re going to have to find out over time. There’s not going to be an instant gratification with that.
And even if you want, I think it’s very difficult to trade if you want instant gratification, I think you have to play the long game and think about what are your annual returns more than what you’re trying to do on any particular day. Because then again, without any real trading training, you can force yourself into stuff because you need that dopamine hit for the day. I don’t have that in my brain. Maybe I did, I can’t remember, but I don’t think it was ever part of my calculus. It was always a function of I can remember saying to myself, do I know what I’m doing? And what do just, I spelled out if I’m in a trade, it’s either going to go up, go down, or stay flat. So under certain circumstances, what’s going to happen? The easiest decision, right? It’s like applying to schools.
If you apply to your top five schools and you get into three of ’em, that’s actually a problem because now how are you going to choose when any of the five were going to work? Whereas if you applied to your top five schools and you only got to got into one, there’s no problem because there’s nothing to decide on because you only got into one school. So to me, the easiest trade is one where you get long and it hits your protective stop and you get knocked out. Nothing to decide there. It’s very mechanic, it’s very rote. The tougher part is what happens when it starts to move in your favor and you get antsy. Because again, in my humble opinion, if you’re newer, you’re probably looking for something to satisfy you emotionally. And again, not to plug the course, but the stuff that we talk about helps you address where these things come from.
80% of the time it comes from subconscious. You don’t even know where or why you behave the way that you do. But like me, ganja, anybody else, we’re all products of our environment. And so we have been taught by other people demonstrating through their behavior how you should behave in certain circumstances. And your sense is your sense of smell, your sense of hearing, your sense of sight, your sense of feel, you, the way you can perceive and feel someone’s energy, which is a sixth sense. You’re taught that because people are teaching you all day how they behave under certain circumstances. And you’re absolutely insane if you don’t think that that’s infiltrating your world. So you have to put yourself on a diet in saying, pardon my language, I have a no asshole rule. If someone’s going to act like a jerk or lose control the double, bye-bye because they’re only going to screw up your own inner game. You have to have enormous amount of discipline to not have that around you aside, just immature and annoying. And the last thing the trading world needs is someone who’s 32 losing money and acting like they’re 16 and they’re going to throw a temper tantrum. There’s no real room for that in the trading world.
Yeah. I wanted to add something real quick too. I really like what you said about calculating the outcomes and from each side, from the winning side, from the losing side. And I wanted to ask you, if you calculate all the outcomes for a trade and you’re like, I hope this is a winning trade, you’re like, here’s the chance that this is a winning trade. Here’s the expected value, praying, praying that it’s a winning trade. But you also calculate, calculate the negative outcomes, right? You’re like, okay, well I could lose 30% on what I put into this trade, which is a lot I know. But if you calculate that and it turns out you’re right, even though you lost money, does that still validate you in some sense? Because you’re like, okay, look, I calculated the outcomes, I didn’t make money, but hey, I knew that I could lose money and I lost pretty close to what I thought I was going to lose.
So you have to remember, the expected value in and of itself is on average. So here’s the funny thing about it is like say the expected value is 1.2. Even if you lose the expected value of every trade is one point. Two years ago I spoke with an author, she was a poker player, she’s probably still is, although maybe not professionally, Annie Duke. And we talked about how if you have a process and you follow that process, you can lose, but you still did the right thing. Whereas there’s other times in life where you can do absolutely the wrong thing, make a fortune and think you’re onto something. Those are the people who kind of win the lottery and then end up broke with too many rental income properties with no tenants, and they find themselves filing for bankruptcy. So you have to stick with the process.
My comment was more relegated to folks who aren’t doing the back testing, right? Cause they don’t have anything to go on, they’re in the dark. Now, why someone would want to stay in the dark about knowing something about the outcome of a potential trade is very foreign to me. I don’t know why. Why would you go to college if you didn’t know what the potential outcomes were? Why would you do anything if you didn’t know what the outcomes were? Now handicapping those, you’re going to get better at that over time. But to me, even if you have a losing trade, the expected value of that trade was the same as if you won. When you do expected values, you’re something that’s black and white, which is what’s your winning percentage? You know what that is? Or you can certainly simulate it. Again, to me that’s something you’d need to know because say for example, you had a trading idea and the thing only worked 20% of the time, that doesn’t mean that it’s a failure. Yes, if you’re in school, that’s a failing number by a big, big margin. But if the payoff is 40 to one, then that to me has positive expect and value. The question is, do you have the emotional makeup to be in a system that wins one in five times? Because that takes a special emotional makeup to be able to follow that system.
So again, we talk about the goal for the trader is to have a system with which they are compatible. If you take it personally that you lose, nevermind the magnitude of the loss, but just the losing in general, trading’s awfully difficult. So my focus was always like, am I onto something here? Because I have really good instincts and really good intuition. So I knew if I was close, then it was just a question of culturing the pearl. I could start to see things taking shape. But there were years where I didn’t know my backside from a hole in the ground, and I just knew like, well, I’m never going to go on tilt and I’m not going to blow up. Cause it’s hard enough to get a grub steak in the first place. So again, if you don’t care about status and if you separate what you think a winning trade does for your ego, you’re off to a good start.
But like I said, so much of this stuff comes from your subconscious. Sometimes you don’t even know why you do what you do and you don’t know why you feel the way you feel. I make sure if someone’s sitting in my classroom, you don’t even get to lesson number two until you know what the hell you’re doing it for. Super clearly. And then I get to see what you write. And if I’m not one over again, this is all private, I never kiss and tell, I’m going to ask you to go back to the drawing board because I have a hunch that there’s something more to it.
What is why some people want to be famous? So they put on famous trades than they blow up and seen it a million times. I was asked to help a few people who were not that you couldn’t help ’em, you couldn’t get to ’em, they didn’t want to listen. And it’s just like addiction. You can’t aa, as I mentioned the saying before, which I borrowed from aa, I’m not an alcoholic, but I’ve been through Al-Anon a few times. It’s for people that want it, not those that need it until you’re, you’re willing and you make up your mind that that’s what you want to do. You’re not going to go get the help. And sometimes folks get caught in a rut and they don’t know where to turn to. So I always just say, stop trading because if it’s not serving you emotionally or mentally, then to stop doing what you’re doing because something’s not right.
And in any given trade, there’s always two outcomes. There’s the financial and there’s the emotional and then all the combinations that can possibly go on. So it gets super, if you look at it, whoops, it can get super deep. But starting with knowing what the why is, what it that, how do you want trading to serve you as a human being? Forget the p and l. How do you want this process to serve you in your life? Because to me, traders are risk managers and you have to look at it that way. You’re adding and removing risk at strategic times. You need to know why you’re doing that. What is your motivation? You need to know how you’re emotionally, emotionally sat, satiated. How do you win emotionally from that now and in the next year? How are you going to do it over five years?
And that to me is the benchmark of how you succeed long term more than how to swing, trade or date trade or trend follower position set trading, broken wing strategies in the options markets, or you trade the binary space in the uk. To me that is just how you express yourself like an artist would. Some people play piano, some people play the cello, some people play acoustic guitar. And then what’s your technique? If you play guitar, just like in trading, there’s a knack that you have. There’s certain folks who play beautiful nylon string, but don’t really have much to say on say, an electric guitar because it’s in a lot of ways it’s a different instrument. And that’s before you look at right hand and left hand technique. So to me, trading is super deep because there’s a million, there’s myriad ways that you get fulfilled as a human being and a lot of times it has nothing to do with the making or the losing of the money.
I wanted to bring this up in the last episode too, actually. It’s funny you mentioned Annie Duke. I’m actually a bit of a poker connoisseur. I find high level poker really, really entertaining and just fascinating. And you know, were talking about trusting the process and even developing your own and running it through simulations and testing it. And I almost brought up counting cards. I don’t know if you’re familiar with the concept, but yeah, it’s, it’s really big in poker and they’re communities built around this and
Blackjack.
And blackjack too. And for people who don’t know, counting cards is basically a system of assuring that, you know, win money, ensuring the best outcome I guess for each hand. And there are lots of different algorithms you do and you count in your head and it’s actually banned in some casinos too. They’ll kick you out for it. But what I’m trying to get at is there are rings of people, and you can find this on YouTube, it’s really popular right now. Actually. These guys will put a hundred grand together and they’ll say, Hey, we got five players, we’re going to go count cards at all these different casinos. And they talk about like, okay, so today we were down 50 k, but we’re still doing the right moves, we’re still counting the right cards. We know eventually we’re going to be up. And then by the end of the trip you, you’ll follow them along this journey. And they’re up 45 K from their start. So 145,000 and they just split that between each other.
Yeah, yeah, exactly. And Annie and the show mentioned the expected value of a hand. You could sit there at the table, play the hand absolutely correctly and still lose. You didn’t do anything wrong. You played the hand exactly the way you should have played it, but you lost. And that’s going to happen with trading too. I think it’s probably, I think our educational system has a lot to do with how people perceive accuracy, but you’re dealing with a high level of uncertainty and in a system, both poker, blackjack and trading where you’re dealing with probabilistic outcomes. And so for me, the minute I started to understand expected values and conditional probability in base theorem and that there are, like I said, there are myriad ways that trade could unfold to both make and lose money. I can sit and meditate on all those perspectives. The ones that I could even think about and bring into my consciousness and say, okay, these are all probabilistic, these are all I at the beginning, of course I couldn’t handicap them.
But over time you can learn to do that. You can learn to see, okay, what given your emotional makeup, not what, because we don’t get paid to know stuff. We get paid to execute. So what is it that you can pull off? Because no one cares about the idiot with an encyclopedic memory about trading charts or what have you. If you can’t put on the trade, that doesn’t really serve you, it doesn’t serve the community. Why? Because you could look up everything for free. There’s a video on it somewhere. So then the question is, what can you execute? What are you comfortable executing?
You get up every day, you go to a job. Why? Because you don’t want to get fired probably. That’s why right? There comes a point where you’re not self-actualized anymore, but it’s more fear-based. You’ve got overhead, you’ve got bills, you’ve got a mortgage, you’ve got a wife and children, or a spouse or a lover, whoever. Doesn’t matter to me what your preferences are. But I’m just saying that once you get those types of responsibilities, the stakes change. When you’re trading, you have to live with that uncertainty. But as I mentioned in previous shows, the uncertainty is where the money is because the uncertainty represents risk, not just financial risk, emotional risk. And you have to be willing to feel all of your feelings. They’re all trying to communicate with you. So it gets very complicated because especially for guys who aren’t m maybe, I don’t want to say stoic, but women are much better in processing their feelings and even talking about their feelings.
In my non-professional like experience, I’m not a psychologist, I’m just good at studying human behavior, especially around trading. So again, using myself as a Guinea pig, anything that I’ve ever talked about on the audio only version of the show as well as what’s going on in YouTube largely comes from my own experience and what I had to learn and what I had to go through. Even the inner voice trading, people are like, well, it’s a trading book, but there’s not a damn trade in the thing. And well, it’s a memoir, it’s what I thought I knew at the time. To me it’s got a lot of candor because every time I thought I was onto something, I find a new way to fail.
But the thing is, I never quit. So it’s a gesture of sticktuitiveness, if you will, because there were a lot, try doing that for four years. So I would say just learn to deal with the fact that when you put on trades, there are probabilistic outcomes and that you human beings, despite how smart you think you are, I’m going to call you out and say that you can’t predict anything. You might think that you can see things after the fact very clearly, but studies have shown that people are not as great as at predicting it. And you can kind of get honest with yourself that that’s the fact for you. Then you can let go of that and not drive yourself crazy and invite, as Brandon said, going on tilt, which only undermines you. There’s no real good thing that can happen when you go on tilt.
It always subverts your efforts no matter what in any area of life, this business is going to drive you crazy. So you have to have a strong emotional and psychological inner strength, if you will, because otherwise things are very rarely going to go as planned. The only thing that you can do is control your own behavior. And for some of you, that’s also very difficult to do. So that’s why we focus on doing it, because that to me is 80% of the business is can you control your own behavior? Can you act consistently for five to 10 years? Seems like it’s easy to see it, but doing it in real time when every trade has both the financial and an emotional payoff, both of those compound. So there’s no magic pill I can give you. It’s something that you have to get through experience. Which again is why I say doing the trading is going to teach you more about trading than reading books or watching videos, even this one for example. And that’s all I have to say about that.
Yeah, no, and I think to kind of add one more thing before we wrap up here, you know said going on Tilt really subverts your efforts and you’re a hundred percent. And what I’ve noticed specifically for me and my experience with this ecosystem and this game that I’m playing is you could have five great days in a row and you could literally just throw away all that effort, all of the six hours a day, the hard effort, the studying, you could throw away all that in one day of tilting. Yeah, one day. That’s it. And it’s really not worth it. And it actually gets worse than that because let’s say you go on tilt with work or play whatever it is, it’s going to affect you outside of that too. And who knows, you may say something to someone, you may, you’d be like, man, I really wish I didn’t say that, and I know it was just because I was angry about what happened today, but I still feel like a jerk now. And then it starts to affect you externally, and that’s like the worst because you threw away all your hard work that you put into whatever you’re it is you’re doing. And you also let it affect you outside of work too,
And now it’s in your head and that thing’s paying dividends. Absolutely. So I mean that’s why this is a beast in many ways. I don’t know why betrayed, because it’s so, there’s just so many moving parts that are, there’s stuff that you can see, but then the majority of it you can’t see. And when you are being triggered by stuff that’s coming out of your subconscious, then you have to either keep, either have to be like me and just be too stupid to quit, or you need to work with a coach and figure that out because it typically doesn’t go away by itself. There was an enormous amount of work I had to put in that I’m very proud of. I mean, pride’s a big banana peel, but at the end of the day, most folks would succumb to it because trying to make it over four years, that’s a lot of time.
It’s 1200 and something days, whatever, of insecurity, of uncertainty and having to deal with that. But I eventually found out that I had that type of makeup that I was largely born with. I feel like similar personality traits, I’d be good as a 9 1 1 operator or an emergency room surgeon. Cause I just don’t freak out when things are stressful. I stay. I’m a self-contained unit basically, and you focus on the process. So it’s a good book out there if you want to read something that’s kind of related to trading, but not specifically about trading. And it’s called Simple Heuristics. I don’t think I have it here. No, it’s probably in the bookshelf somewhere. But anyway, it’s called Simple Heuristics that make us smart. You might find that interesting when you’re thinking about indicators and your process and what is it that you can do that you can replicate day after day after day and create for yourself your own version of best practices as it relates to trading because it has to be congruent with who you are as a person.
Anyway, I appreciate everyone being here. Again, I don’t really tout stuff, but I know the course that I built came straight out of hard knocks and through my own experiences and it’s actually what I did to evolve myself into the person that you guys kind of see through the video here. Now with a lot of help from the folks who helped and mentored me over the years. I don’t think there’s anything like it out there. And if you’re struggling with that, this can absolutely help because there’s no place to hide. So you might have to take a beat and give yourself a couple of weeks or months to get ready for it, but it’s kind of in your face and it forces you to address stuff that you might not have had to have addressed before. But if you wanted bad enough, it might be a good fit if you’re really hellbent on making it as a trader. But as Gja said, please like and subscribe. Check the bell. What does the bell do?
It gives them notifications for when you post a video.
Oh, subscribers don’t see that.
They do, but the YouTube subscription box is broken. So even this is actually good knowledge for people who are subscribed to channels and they’re not getting the videos. They may actually be uploading videos, they’re just not showing up in your subscription box because YouTube has issues with that sometimes.
That’s why he’s here. He’s smarter than me. So check the bell, check the bell. We’ll do this. We’ll keep doing this. We love it when you send in comments and have questions and stuff because sometimes we talk so fast. I’m from New York, we talk super fast and I might lose my train of thought, but kind of keep going. So keep the comments coming in. It means a lot to us too. It’s kind of good to give back to the community from a Think and Grow rich kind of standpoint. So thanks for being here, ganja. Thanks for all that you do. I like the feedback, I like the vibe of the show. It’s good. You bring up good questions too. Good follow up stuff. Help the show stay focused and thanks everybody for watching the show and doing the deep dive with us. I think you can achieve whatever you set your mind to. The mind is the best computer on planet earth. Just remember that. Intentions equal results. So you need to know deep down what are your true intentions. And that might be intimidating for some folks if you’ve never been put in that kind of spot to really have to think about it, especially if you’ve been living your life for someone else. Anyway, I appreciate everybody being here and I’ll see you tomorrow. And Ganja will be here again next week.
Thank you guys very much. See you in the next one.

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This is an automated transcript

Hey everybody, this is Michael Martin. Happy Tuesday. So I have another comment that came from YouTube by Roman. I hope I’m saying the name right, and it says, can you please, can you make videos on these topics? One, patience until our setup forms. Two, writing prophets. Three, emotional intelligence. Sure. I mean, I kind of have been making videos on those all along. I could probably spend a whole year on any of those three because they’re very deep subjects. I think it starts with the fact that we’re products of our environment and that the people that we were surrounded by are nuclear family. Our friends, they demonstrated certain behaviors in certain circumstances, when they were happy, when they were sad, when they were angry, when they were rich, when they were broke. And we learned that, right? We learned that behavior and part of it becomes part of us because if nothing else, it’s in our subconscious. If you’ve ever seen somebody fly off the handle or you have found yourself doing that, it probably comes from have you having seen somebody else doing it, right?
Verbal abuse that’s typically taught. People don’t gene generic generally come out of the womb wanting to rail on people and berate them. That’s kind of stuff that you have to see. Well, where did you see it? It might have been an innocuous type of a thing where it wasn’t really a big deal, but it was on that particular day. Usually those folks have regrets if they have any sense of consciousness. So I think we could take any of these and turn it into an episode. We’ll start with the first one. Patience until your setup forms. There’s a lot to be said. I’ve mentioned patience. What is patience? It’s the state of not doing anything. You’re in a moment of limbo. You’re waiting. Now that could mean you also have your stops in and you’re just waiting for the market to come to you, right? It’s life on life’s terms.
You don’t want to chase, or you certainly don’t want to engage in the market just because you’re not doing any activity, right? Because trading is not making executions. That’s the very last step in a very, very long process. Does that make sense? So it has to be intentional intentions, equal results. Well, what do you trade for? You’ve heard someone really bright say, what do you want your trading to do for you? How does it serve you? Does it help you busy up your day? Because man, you could look at charts in multiple timeframes and uptime and downtime and throw on indicators, and you could spend hours every day observing that stuff, but not making any particular progress. So I think when you think about patience, you have to think about what is it? What is it that you feel when you have to sit on your hands, right?
Because that’s really what comes up. Cause I don’t think of patience as a feeling or as an emotion. It’s a state of being, right? Patience where they’re, there could be things to do, but it’s out of your consciousness right now. So you’re going to go learn it on the fly. I don’t really advocate that. I think do your preparation. I think it was Paul Tooter Jones who said, the trading happens between 5:00 PM and 8:00 PM every night. And what he was saying is in the greater context is that that’s in your preparation at least, that that’s when it was for him for the next day. You might do it earlier in the morning, especially if you’re short-term trader and you’re looking, you’re really looking for a catalyst more than you’re looking for the name. So that’s a different mindset than someone who might be stalking as a position trader, knowing the fundamentals of a commodity future or looking at technical charts.
A good example of doing that right now and looking at a move that’s underway would be in sugar, right? Sugar’s taken off. There’s fundamentals that are going on. The charts moving up, hasn’t taken a break. I’ve seen these things move. They can keep going for a long period of time before it kind of settles in and creates another stage as stock traders would call it. So where did you have to be patient in other parts of your life? And what were the results then? Because chances are, if you don’t like the feelings that you have to feel when you have to be patient, there’s an emotional model, a psychological model around that you’re replicating. And it could infiltrate your trading. You might find it. We talked about relationships yesterday. If you’re impatient, you might try to accelerate a relationship before it’s had enough time to really ripen on the vine so you can study your own behavior, which is why I say self-knowledge is more important than trading knowledge.
Because if you don’t know who you are, it really doesn’t matter what you know about trading, about anything in life. You need to know what makes you tick. And the folks that I know that are really successful, whether they’re traders or Richard Branson or anybody else in business, is I believe that they have superior self knowledge and they know what they can execute. They can envision themselves living a life that’s very different from the one that they’re in, and they make that their goal and they go towards that goal knowing that it’s going to be messy, that it’s going to be full of failure, but they’re going to keep failing forward and learning along the way. So when you learn the hard way about patients that if you sit around and you keep trying to put on trades, when you have no business being in those trades because you put them on because of boredom or because you saw somebody else making money in a certain name, you realize that that type of behavior sabotages yourself by way of drawdown, right? Because it’s very rarely that you’re going to put on these trades as a roll of the dice and they’re all going to work out and become career trades. What are you thinking about? And I’m not trying to ridicule people because I’ve had these thoughts in my mind. I did things very intentionally coming up where I didn’t really roll the dice. I can count on one hand the time that I took flyers. I always had a preparation involved. My thought process might have been faulty because I was ignorant
To myriad things that you need to be aware of. But I was still making attempts because it’s in the attempts that you learn. Now, maybe you’re going through that right now. It’s hard to say. There’s no context in your question. But where in your life did you have to be patient? Was it applying to a school and you were waiting for the acceptance letters? What did you do? Did you call your friends and daydream about what it would be like to be in that school? Did you start looking at the online store to buy the hoodies with the repping the school name? Did you go visit the campus again by yourself? I’m not making fun of anybody. I’m just giving you some for instances. What did you do when you had to be patient? How did you spend that time productively knowing that you’re powerless over the outcome?
So I look at that as patience can mean a few things now as it’s hitting me. It could be when you’re not in a trade and you’re waiting for a setup and it’s not there, or they haven’t evolved yet, or you haven’t found them right? Because now you’re stacking emotions. You have to be patient, but you’re also frustrated that you don’t have enough names. So how do you do better research? So that feeling might motivate you to help yourself do better research so that you’re better prepared. That means maybe fewer missed opportunities. Cause I don’t know these days what the screening process is. I know there are tools out there. I don’t typically endorse any of ’em, but you might find one that helps you screen your names because that’s the beginning of it all right? Is to figure out what’s going to even be on your watch list to trade the certain way that you trade.
Then there’s, when you’re in the trade, you might have to be patient. Is it moving enough for you? Or do you cauterize the winning trade because you can’t take the pain of winning, right? I have a whole thing on that where I think there’s a whole family in a universe of short-term traders that could make a lot more money if they could just learn to hold onto their positions longer, especially if they’re winning, you see? So what does that feel like? Does the lack of patience cause you to unwind an otherwise good trade that you’re in because it’s whatever, it’s hit your three R level or it’s 3 45 eastern time?
So try to reconcile what those feelings are trying to teach you, because I believe sometimes the feelings that you do want to feel are on the other side of the ones that you don’t want to feel. You just have to learn to get used to them and take what used to be discomfort and make it comfortable. How do you do that? Massive repetition. You just keep doing it little by little. You don’t have to make gigantic strides. Just do it little bit, little by little. But then again, if we’re all pleasure seekers, what is it that you feel when you have to be patient? And how does that serve you think you don’t like those feelings? Why?
Because I’m from the school that there’s no such thing as a bad feeling. They’re all good because they’re all showing you that there’s a certain stage of where you are in your life right now that doesn’t conjugate with an image that you might have. And I learned, one thing I learned from Ed was knowing how to understand the difference about judgment and being a judge so you can really go to school on yourself when it comes to patience, because sometimes sitting on your hands is the best trade. And that could mean two things. One, not putting on a trade impulsively, which I know a little bit about. I I’ve acted impulsively when I was younger.
And then what do you feel when you have to be patient when you’re in the trade? So there’s two things there. What to do when you are not in a trade? Do you force trades because you’re busy and you can’t take the feelings of doing nothing when there’s other people that might be making money trading another style and another instrument or another asset class? So how can you reconcile that and realize that sometimes being a pro means no activity, right? Because either the setup that you’re looking for isn’t there, or the exit on the trade that you’re in isn’t there either. So then you could study, yes, I didn’t get stopped, I didn’t take my profit, but I have a time stop that I’m going to put in now. So after two or three days, if I’ve been a trade and it hasn’t worked out, I’m just going to offset the risk because clearly momentum has stalled.
Now look, I can go on and on about this stuff for hours, but to me it’s like the best thing that you can do is really study yourself because behavior predicts where you end up in life and it’s no different for traders, you see? So look at that and just notice there when you’re engaged with something and you’re looking for an outcome, but the delivery of that outcome is uncertain, right? Cause trading in and of itself is probabilistic. Look at anything in your life though. You reached out via email to somebody or you sent someone a text or you were going to get tickets for the new Basquiat installment downtown la, which I would I’ve seen last week and I would go see it. I’m going to probably see it again. When you invited somebody and they didn’t get back to you. So what is it like? Why didn’t they get back to you? Well, maybe they’re blowing me off. Maybe they’re being discourteous, this and that. Maybe the email went to spam, maybe their phone was off when the text was sent and it was never delivered. So you make up all these things in your brain about what it could be that’s off putting for you and maybe what happens, you act out of emotion and snap at the person. So again, that all comes from not being willing to feel the feelings around patients.
What happens when you have to sit on your hands?
Does that emasculate you? Right? Do you feel you should be doing more? Maybe your opinion of yourself is not congruent with where your ability is just yet. And that could certainly cause a lot of trouble because you could find yourself. I was in the very beginning of my career on Wall Street, I thought that a trader was someone who could trade any asset class in any timeframe and owe how wrong I was. And my success only came by saying, okay, I have to put some of my goals and my dreams and my aspirations on the back burner and focus on one. So I think I remember telling you that I had to first cut away foreign exchange, the interbank stuff, then I had to stop options trading. Cause it took up a lot of time and there was certainly a knack to it. I had some skill in managing stocks, but I had the best results from commodity futures, and that’s just the way God wanted it, basically.
So I put four x options, equity derivatives and stocks over here while I focused on getting good at one thing and one style. And then from there, I could grow. In the meantime, I had to deal with the feelings of like, why was I a failure at far X and how do I reconcile the fact that I had skill in trading stocks, which was much more popular, much more broad asset class that almost anybody could talk about. Whereas commodity futures is not necessarily a household asset class, if you will. It’s not something that you’d jump in a cab in New York City and someone could talk to you about the march april spread in natural gas, for example, where they might have an opinion about Amazon or Apple and the new iPhone at the time, or this and that. So the best thing that you could do, I think, in any of this trading stuff, is really study yourself and investigate why do you feel the way you feel?
And then how did you pick up those feelings? Because it’s from learned behavior, right? Then you could begin to unwind it and or replace it with behavior that’s better for you that suits you based on what your goals are, and of course what it is that you want your trading to do for you. That’s why I bring all these questions up because they all kind of come back to that. It all comes back to you having a goal and having a clear vision of what you want your life to look like in the future. So anyway, thanks for the question. I appreciate it. Please like and subscribe and let me know what you think and the comments below. I usually respond and or I’ll do a show on the next one. Thanks for being here, folks. I’ll see you tomorrow.

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This is an automated transcript

Hey everybody, it’s Michael Martin. Thanks for being here. Move the camera around a little bit just because I wanted to, needed to get the mic closer, but then it was in the way of the other setup, so I moved the camera over here, see if that works a little bit better cause I want the sound quality if I’m too far from the mic, even though it’s a great mic, the sound quality doesn’t really work out all that great. So it’s going to be a great week. I have some great topics and ganja and I actually have already recorded Wednesday’s episode. So for today I want to kind of talk about a question that can kind of tie into that Wednesday discussion that I have with Ganja Brandon. And it comes from a comment on a video. The video was building higher levels of discipline. And Micah writes, I wanted to know your take on relationships, both friendship and intimate within trading.
It seems to me that most highly successful traders either taking their personal dating life seriously at much later time in life or never even concerned themselves with the thought of a romantic partner during the first few years of development as a trader, is this the price a trader must pay for success. Friendships dwindled down as well when someone wants to get a drink at night. This is a long comment, especially for us folks in la. It seems like a poor choice when we know what lies ahead of us in the morning. Yeah, meaning Coco opens at 5:00 AM in Los Angeles because it trades in New York. There will always be something for us to do. Is this just how it is in the early years or is this just the way things are when you dedicate everything to trading best? Micah? So thank you Micah for writing.
And so I don’t know what the dating habits are for the men and women and non-binary folks in this space. To be honest with you, I do know a lot about relationships because I’ve had a lot of them. I know what makes it work for me. I know what it makes, what work for partners that I’ve had the women in my life. But I think, and this is kind of a truism, it all really comes down to communication. I don’t know that traders who are just starting out are single celibate or whatever, or they let go of certain friends. I think I can share with you this. When folks do the mindset training that we have, they start to see the world in a very different light. They see themselves in a different light and then they get to interpret their own behavior and their behavior in their relationships with a different lens.
And so in that case, they can yes, kind of sift things out and let go of certain things that they had been holding onto or establish newer relationship relationships or deepen the ones that they have. I think communication is key. When you’re in a relationship, what is it that you want out of it? Do you just want the physical part and the sex? Do you want companionship? Do you want someone to validate you? It gets very deep in terms of what are your personal needs? What is it that you want out of the relationship? Just like I say, what do you want out of your trading? People are like, well I don’t know man, I just want to make money. Well, that’s not really why you trade, right? It’s not why you trade. There’s so much more to it. So I think it’s an evolution.
Obviously if there are people, how could you explain it? If I was in a court of law, how could I explain that? Younger male traders, a group of people that I came from because I’m older now, how come they might be single? Well, when you’re studying the how to of trading, that can become all encompass encompassing. I don’t recommend you go that route. Cause I do know for a fact that you can burn out very, very quickly if you don’t take the time to, I don’t want to say decommit, but to put the market on the side for a while and not think about it. It’s a very healthy thing to do even when you’re just starting out and you’re like, I got to look at my charts. I got to read another book, I got to listen to another podcast. I’ve got to go do all this kind of research.
I think that is important. But anything in life, you have to have a balance. And if you don’t or you can’t find a partner that’s going to work for you, it might not be the partner’s fault, it might be the fact that you just communicate poorly. So setting boundaries, what’s your safe word? Mine is banana. What is it that you want your partner to do for you? And what don’t you want from a relationship? Do you want someone who’s in your back pocket? Which is a nice way of saying another expression who’s kind of this way? I don’t want that kind of overbearing type of situation with men or women in my life. So I think if you can communicate clearly, especially if you’re using a dating app because it gives you all the fields. Don’t put stuff like if you voted for Trump, swipe this way or if you’re not, if you voted this way or if you’re not a friend of this or that or whatever. I mean you have 140 characters to kind of say what it is it, what is it about you that makes you shine and you’re going and you’re defining what you don’t want in other people.
So be careful what you communicate, right, because you only have that brief moment in time to express yourself. But again, I do think it’s important to describe what it is that you want and what it is that you don’t want because that’s very, very healthy. You need to know the boundaries for yourself as well. What is it that it’s not like you can tolerate or put up with it? Cause the other people aren’t bad. They’re not bad people. We’re just talking about chemistry and is there a good fit? So what works for you? Because they can all be very, very lovely people. I, and for one, I never don’t do bad breakups. So I’m thinking maybe you communicate early on what it is that you want out of this relationship. Where the boundaries, what kind of time do you have for the relationship? Here’s what you can commit to, here’s what you’d like to see from your partner and then have that conversation.
It’s a very adult-like conversation to have. I think it’s a very healthy one too, because then as they say, expectations have built in disappointments. If you’re meeting people out and this and that happens and you start hooking up and things start to go down the physical path very quickly, that can lead to resentment because if those needs, needs don’t get met after there was a certain type of behavior and all of a sudden you turn on a dime, no one likes surprises like that, right? In life. And it’s just fair. So I think in the onset you might talk yourself out of some business if you don’t know what I’m saying. But unless you want all the drama thereafter, why would you want that? Why would you want all that angst between yourself and a partner? Because things got off to a certain start and then you put the brakes on stuff because you wanted to dedicate time looking at your charts.
I would go out on the date you, but I know when you’re younger and you’re starting out, and again, you want that validation. So you put the work in because you want the winning trades. So you can break down your emotional models. Again, why do you do what you do? If you’re older and more established, then you already have a strong idea of what it is that you’re doing every day to create your alpha. And that there might be certain days, especially if you’re at a place where you say you just trade natural gas and for any one particular day or week, there just might not be a lot of activity in natural gas for the way that you trade it. So you might have some extra time on during that week. Well that would be an interesting conversation to have with your friends or your partners that you know like to be spontaneous because that fits with your type of schedule.
So can you find a partner who can get up and go, Hey, market’s week, I’m looking to be long gas sold off 15 cents Wednesday of last week and you know, were looking to get long at two 50 basis to Junes and it didn’t work out. And so now you think the chart’s going to need several days if not more, to repair itself. So you take a three, four day weekend. So can you find a partner who can get up and go right now as far as platonic friendships, same sex stuff, especially if you’re a guy, you know have to remember as guys are coming up, there is a PAC mentality to guide behavior and there’s a lot of peacocking going on. There’s a lot of, I don’t want to say lies, so I’ll use the fancy term pre verification where folks want to cast a bigger shadow when they’re younger because they don’t have anything to show for their experience or for their education at that point.
And I think that’s kind of natural and they’re really insecure, they mean well. It’s certainly those are feelings that I have felt. It’s like, man, I went to this great school, these teachers, some of them had Nobel prizes and what do I have to show for all my hard work? At the beginning it wasn’t much. It was all promised. It was highly projectable as a draft pick so to speak. So I think with those types of friends, there’s nothing wrong with watching people peacock. I think it would get under my skin very quickly though. Now given my temperament now when I was younger, I just kind of shrugged it off because I knew those people were kind of blow hards and the folks who were talking about all their conquests really weren’t having all their conquests. You probably know the type. So you should find people who support you when you’re endeavors.
Obviously not talk about your behind your back, not try to cut you at the knees every time you’re in a group of people. Those types of folks are usually just jealous, insecure, they might not have a clear vision for themselves and they’re on their own path, nothing wrong with it, but that type of negativity isn’t going to help you be a better version of yourself. So those types of things, if you really care about the person and you’ve known them a long time and they’re acting out of character, you might want to have a one-on-one and just say, Hey, I noticed when we’re together you take these pot shots at me. Why is that? You know what I’m saying? Because I find it hurtful and you talk about your feelings, you can’t be wrong as soon as you call the guy a loser or whatever, you’re going to look to escalate stuff. And if that’s what you want, then by all means escalate and don’t even wait, just cock the guy in the face and let him figure out where the new boundary is.
But I would definitely take the time to communicate those things and then realize you’re going to do better if you kind of congregate with folks who are on a similar type of mindset or trajectory because then you could support one another. And so your peer group can become your tribe or your own little mastermind. So that might be something to consider. But I do believe that when I think about relationships and trading intentions equal results pretty much in everything in life. So if you’re not in a relationship, it’s probably because you don’t want to be. Because I think if you want to have a healthy relationship and be a traitor and do it from say California, when the markets are largely New York and Chicago hours, you can do that. But you just have to build out the boundaries and what you’re willing to do and what you can’t do and then effectively communicate that.
The good news is when you do that, I think you build trust with people because now you’re being open and honest and saying, here’s what I can do. Monday through Thursday might be a little challenging in terms of doing stuff, but as long as we go out and I can get home and I don’t know, get to bed by 10 o’clock on any particular night, there’s no real reason why we couldn’t go out and see a movie or grab some dinner or do something during the week or if there’s sleepovers, just understand I got to get up at five and get out the door. It’s nothing personal, but we’re not going to be any adult activity that next morning because I got to get up and get to work. And it’s important to me that you understand that this is something that’s hard even for the best of people.
I’m just starting out. But this is important to me. I want to have a good relationship. I like you as a partner. I always want to have an open line of communication. If whatever I’m doing is making you feel a certain way, then please let me know and communicate it with, cause I’m figuring this out as we go along too. Those times of those kinds of conversations are good for bonding. And so you can communicate, it might always go the way you want it and the person might say, I need someone who’s a little bit more available. I need someone who’s a little bit less intense, but that’s okay. It’s better to figure that out early on than to go put 3, 4, 5 months into something and find out that your tab A doesn’t fit into her his slot B, if you know what I’m saying.
So I think if it’s important to you, then you can find a way to make it work. And it all starts with really, really good communications. So anyway, folks, as Brandon likes to say, on Wednesday’s episodes, please like and subscribe. And then there’s a bell thing you could click on too. Apparently it gives you notifications. It also gives us really good data on the stuff that we’re publishing and how well it’s resonating with the audience. I’ve been given away the audiobook version of my book, the Inner Voice of Trading. So there’s a link below in the description. You can get it for free. It’s a free download. It’s probably four or 500 megabytes, but it’s really good people. It talks about my journey, kind of how I failed my way to success is the cliche way of saying it, but with a lot of candor.
I speak about what I thought I knew at the time and what I endeavored to do and what the results were. It’s basically about a book of failure. I had millions of winning trades. I didn’t mention any of ’em in the book just because I don’t think the community needs another book that gloats with the secrets of trend following or the little known things that day traders do because they don’t exist. There’s not little known things. It’s the age of the internet, everything is known, right? Anything that you want to know is already on the internet somewhere so you can go find it. So there’s no such things as secrets. There’s no little known X, Y, Z because everything data’s proliferating.
But anyway, that’s all I got on this subject about relationships. There’s probably a lot more to say, but I ultimately think intentions equal results. If you’re a clear communicator, you’ll attract the right person and that person will appreciate who you are, everything that you are and everything that you’re not. But anyway, thank you for the comment. Michael, I Micah, I appreciate you writing in everyone else. Please keep the comments and the emails coming cause they give us good data. And I’ll see you tomorrow.

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Everybody, it’s Michael Martin, happy Friday. So this week we’ve been talking about discipline, and why do you think that is? It’s because that had the biggest impact on my performance more than anything. Any other attribute? Yes, I always had a good attitude. I had always had a strong inner voice, but I’m trying to demonstrate that it wasn’t about a particular chart pattern, but my behavior around the chart pattern, right? Because if you know how to draw head and shoulders down, it’s pretty much the same for everybody. You know what I’m saying? Now, how you trade, that can become part of your edge, you see? So that’s why I don’t get too fussy about chart patterns and things, because ultimately it’s how you behave around the chart pattern, right? We talked about the importance of not personifying your p and l. Why? Well, because over a short period of time, p and L maybe isn’t a good representation of who you are or what you know how to do, because the external forces of what’s going on in the marketplace are much stronger than what you’re bringing to the table at the time, or the market is just not amenable for your particular trading style.
So in fact, if you’re starting out, you might have to sit on your hands for a while and wait it out. And if you’re a more experienced trader, you might have to switch strategies if that’s part of your game plan. We talked about time blocking and putting things that are really, really important. Earlier in your day for me, my days got really busy as the days went on and things would happen that I’d have to deal with, someone would call and say, I need to meet with you, or I have a referral that I want you to meet. And so if I had planned on doing, say cardio or the gym after the close, things got really messy after say three o’clock eastern time for me when I was starting out. So what I found out was if there were things that I wanted to do that were important to me that I absolutely needed to get done for a whole bunch of things, including my own, I had to put those things first, meaning earlier in the day, and I mentioned getting in my exercise because it was just too easy to go meet with people.
Someone would call you and say, Hey, I want you to meet this guy. I’ve got what they would’ve season tickets to save Madison Square Garden or new Yankee Stadium. And at the time, Shea, now Shea has been raised for city field, and the old Yankee stadium has been raised to give way to the new one, which I don’t particularly like as much. But nonetheless, someone would say, Hey, I want to introduce you to this guy. Could be a good client for you. That’s referrals or the lifeblood of your business at that point in time. So I would put my cardio or my exercise early in the day. That might not work for some of you, especially if you’re short-term people because you’re looking at the morning’s news as your catalyst, right? Your catalysts aren’t going to happen perhaps until closer to the opening bell. For me, I did my work the night before
To know what my wishlist was. So there were very few catalysts that I would be worrying about that day because ultimately price is going to go where it wants to go, doesn’t matter what people say. So when you’re disciplined, it directly impacts your p and l. So if you were personifying your p and l as we were speaking about it, I think in Monday’s episode, this might be a way to help get you out of that mindset where if you have a day where you lose money, whether it’s a thousand dollars or it’s a hundred thousand dollars, it’s not necessarily a reflection of who you are. It could be if you’re taking flyers and you’re making trades out of desperation, that could be the case. But I think you even know while you’re doing that, that that’s not exactly behavior. And even if you don’t want to go pro, you still have to exhibit professional behavior to get the same results that they’re getting.
You see what I’m saying? So that’s why I always encourage people to try to trade other people’s money because once you have the discipline down to trade your own money, you’re acting effectively like a professional trader. So you’re going to get pro results. Those pro results could be very valuable to other people. So when you also have enormous amounts of discipline and not take trades that you’re making up on the fly, what ends up happening is it absolutely impacts your p and l because by sticking to your discipline, a lot of things happen. One is you tend to stick with the setups that work best for you. So you work, you’ll make more money on average over time. Two, you block out the emotional need for taking flyers or recommendations from other people during the day because you can’t come up with your own ideas.
You’re looking for leadership other in other places, which doesn’t typically work long term. So you block those out. Then by sticking to your discipline and blocking those out, you further build your confidence. Why? Well, because now you’re not your own worst enemy anymore, and it just doesn’t matter if you’re working at Caxton or whether you’re doing this at home in your pajamas. When you take a person who’s got average ability and fill ’em up with confidence, there’s really no stopping that person. So the scale of it doesn’t really matter to me. Everybody falls victim to this when they get psyched out. Doesn’t matter what your line of credit is or what your capital, your assets under management, whatever your firm uses in terms of measuring that amount of corpus, i e, your account balance. So I find that discipline is also important because it affects your attitude and your attitude to me is the most important thing.
Cause it’s very hard to succeed in anything in life. If you don’t have a good attitude. Can you take things in stride, right? Do you live in a paradigm of personal responsibility and realize that everything that you do and everything that you don’t do affects your trading and therefore your p and l, right? You don’t want to put in a protective stop. Well, you might get away with that once in a while, but sooner or later, that’s going to come and grab you, and then you’re going to sit and say, man, I should have known better. I don’t know what I was thinking. How did I let myself get into that bad habit of doing that? Because especially if you’re trading several names, it’s hard to have mental stops for everything. So then you have to let go of the boogeyman of like, oh, they’re going to run the stops.
That’s overthinking right there. So put your stops in. But ultimately, when you think about trying to improve your p and l, it’s not so much looking at a new chart pattern as it is examining and measuring your own behavior about what it is that you’re doing in your existing trading. That’s what can be improved upon first, more than going out and finding yet another chart pattern or another subscription or another discord. Ultimately, these people all have to start somewhere. So why don’t you start and do your own homework, right? That’s the whole point here. See something that other people haven’t seen. Now, it’s very easy for me to sit back and say this now, but everybody, if they know my story realizes that I struggled probably for longer than most of the folks watching. And the thing is, is that I had a good attitude and I didn’t quit.
And when things didn’t work out, I didn’t quit or get pissy or take it out on myself because it’s hard to make money in good markets. You need to still have that sense of discipline. No one gives it away, and that’s just the way the world works. If it was easy, everybody would be doing it. I think a lot of folks try it. Now, ultimately, if you’re running larger lines of credit, you might find that markets are stalled for certain types of trades that you’ve put on. And so you might consider trading smaller until we see some good numbers. Right now, we’re in earning season, so it’s the end of April right now in 2023, and earnings are upon us. So you might want to wait if you’re a discretionary trader and just kind of see what’s happening, win some of the names in your sector and see what they’re doing.
Are they meeting expectations? Are they coming in below? And then how are, obviously the most important thing is how are, how’s the crowd reacting to the news, right? Because sometimes this is very frustrating. You can see a company missed by a penny and no one cares. You could see another company misses by a penny, but the expectation was higher, and the thing could be off quite a bit. The thing could be off 10%. Likewise, I’ve had situations where street, you know that the company beat by 8 cents, which in certain companies could be a monster number and the stock is flat. So you don’t know when we’re coming into earnings just how things are going to work. Has the stock moved a great deal in anticipation of the earnings? And therefore when the earnings number comes out, the thing is basically flat. So you have to be careful around that.
I wouldn’t make big bets if you are coming out of a drawdown. I wouldn’t make big bets before earnings. That’s really a gamble because again, human beings are not that great at prediction, despite them thinking that they have a great feel for things. You might have a feel for how other people behave, but it’s very difficult to be clairvoyant to guess what the earnings number’s going to be and then how people are going to react. So this is why I think studying your own behavior is more important than almost anything else, because you can have the perfect setup, you could have the perfect chart pattern, you can have the perfect clients, you can be approved to trade any market, but it’s what you ultimately do that predicts where you end up in life. So you have to have enormous amounts of discipline and self-control around all the places where you get to enter your orders.
Because just because you have the power to enter the orders, sometimes the best ones are where you’re sitting on your hands, i e, you don’t even enter them, right? Anyway, don’t forget, folks have been given away the audiobook version of the Inner Voice Trading. Click the link below. It’s on me. It’s about four or 500 megabytes. You can get it there. If anything in the show has resonated with you in any way, please leave a comment, like, subscribe, click the bell so you can get some alerts, and I wish you a great, great weekend, and I’ll see you on Monday.

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Hey everybody, it’s Michael Martin. Happy Thursday. So this was a big thing for me and that was learning how to time block effectively. It’s one thing to keep a list of your to-dos, which are different from goals, and then how do you place them throughout the day knowing that you do have to pay some attention to the markets, if nothing less than entering your orders and seeing if they get filled. And if they get filled, where do you put your protective stops? Or for those of you who add to your winners because you don’t buy your optimum position size at the beginning, how are you going to scale in and at what levels? So I had all that worked out. Then over studying that for months and months and months, I was able to isolate what was it that I did in my behavior, in my preparation that required a higher waiting.
In other words, what was much more material in my behavior that led to my trading success rather than looking at things that might have felt good. And so what I found was that there was a lot of, I had macros written out on Lotus 1 23, which was the prevailing spreadsheet of the day. Trading simulators really didn’t exist and the whole cottage industry of coders and this and that didn’t exist either. So what I learned was that I was super sharp in the morning. I was like an early, early morning, late evening type of a person. But the late evening part became problematic because it was in and around time where I should be going to bed. And what I found was in studying my own behavior that when I was looking at computer screens after 10 o’clock at night, and we’ll talk to ganja about this, it does something to your energy and it actually makes you more awake.
At least it did for me. And so I had a tough time winding down if I was doing a lot of market related stuff the night before, well, late night before. So I would do my preparation usually after dinner. I wasn’t much of a TV guy. I was in New York. I’d go to a lot of events, that’s for sure, because I was into the arts and New York culture, and that could mean everything from Broadway plays to off Broadway stuff. That was fun. I had family members in entertainment business. So we saw a lot of musicals, a lot of shows, saw a lot of ranger games at Madison Square Garden, saw a million concerts there, radio City musical. Then there was obviously taking out clients to relationship build and bond and all that kind
Of, so you were out a lot. And what I would do is if I met those folks after work is I would come home and I would get my preparation done immediately. Now, the good thing is that if you’re looking at certain markets and how you buy stuff, or if you’re looking at a certain, looking for a certain pattern, one little look at the chart, you can kind of see are you even in the neighborhood or is that instrument even in the neighborhood of where you want to be? So a lot of times you’re just scrolling through stuff and it needs charts would need weeks or months actually to develop. So there were a lot of the ones that I didn’t have to look at until the weekend because I knew during the week that the charts were a disaster, for example. So then I would focus on, okay, what happened with the things that I am looking at?
Because then even the smaller portion of that are the ones that you’re actually entering orders on. So there might be, say, 12 names on your to-do list. You might have three or four orders in. The other ones are still kind of close, but they’re not right there yet. They’re not at the price that they need to get to the pattern might need more time to develop. So those are kind of close and you have your eye on ’em, but they don’t warrant putting an order in yet. And then there’s everything else, which is the majority of the securities. So that goes for, at the time there was probably 60 traded commodities around the world. Obviously there are tens of thousands of stocks around the world, but in terms of liquid commodity futures, say there’s five dozen, there might be 12, one dozen on my list.
And even of that, there might be only three or four names where you’re actually putting in an order, for example, for a directional trade. So I would just kind of have to review stuff because if you look at the same things every day, if someone said, okay, where’s may sugar trading? You kind of know where it is because you’re looking at it every day. Not necessarily in real time, but from looking at the chart and where you’re putting in your orders, right? Then for the other names, like say you had 12 names on your wishlist and you have four of them, you have orders on the floor, there’s another eight maybe with those, you’re going to put in alerts and say, okay, well alert me when it gets to this neighborhood. So now I’m going to rely on the technology so I don’t have to use all my brain power.
But here’s the thing, I would double check my work in early morning for making sure that I didn’t have any errors. Because if I read in the wrong order and they execute it, there’s no problem with the execution. They executed it the way I told them to. So that’s on me. If I enter it on the screen and I fat finger something that’s also on me. So I wanted to make sure for the orders that I was entering on the phone executions that I had all the math and I’d still make mistakes. What was the biggest one? So in futures, they have this thing called first notice. Now, unlike options where the
Owner of the option has control, especially when you think of it from the standpoint of being able to execute, there is no necessarily execution in commodity futures. Bulls want things to go up, bears want things to go down. But you also have this unique aspect of commodity futures that you don’t really see in stock so much, unless of course you introduce, say, pair trading or options. And that’s hedging. And so you can buy hedge and you can sell hedge selling hedges work. When you’re in the production of a physical commodity, you grow soybeans. So you’re along the physical. So to hedge, you’re going to sell futures. If you make tofu or if you crush beans and make vegetable oil, sometimes there’s certain vegetable oils that are a hundred percent soybean oil. So you get the soybeans, you crush ’em, you bake bean meal or 45% protein, and you get soybean oil, which can be used in foods and salad dressings and this and that. And so when you look at all of that.

So when the, lemme just get regather. My thoughts here. You would look at if someone sold futures, it’s because they were long. The physical. Now I’m long futures because I want to make money as a bull, but they’re someone who’s long the physical that’s actually selling the futures to me because they’re hedging. Maybe they think the price levels are right where they’re supposed to be. And at that point in time, you have to be concerned with the thing on the futures contracts calendar called first notice. And that brings into sharp, sharp relief the time when the shorts can deliver against the longs. So in futures, again, it’s the short seller who actually has the power in terms of delivery. Whereas in the options space, the people who buy the puts and calls can exercise them in futures. It’s the short sellers, especially those who are hedging that can deliver the physical to the long.
And I would never commit to memory what that date was because you would figure like, here’s expiration and you would count backwards. Now it’s all available on the internet. You click the button and you can see it. But back in those days, the information wasn’t so proliferated around the system to know that stuff. The C B O T website didn’t exist. So it was harder to get that information. So I would be aware of where was the volume, where’s the open interest for sure. And that kind of helped me stay clean for most of the time. But I can’t tell you, it was probably half a dozen times a year, again, over hundreds or maybe thousands of trades I had six times a year it would happen that I’d call in an order. Jira would say, okay, just so you know, say it’s a Thursday.
Okay Mike, I’ll put the order in. But just so you know, in case you didn’t know, first notice is Tuesday, Wednesday next week or something like that. And I’d be like, damn. So he’d say, do you want to still put in that order? And I’d be like, okay, let me, let’s cancel that order and I’ll go look at the next expiration. Sometimes it was May, if we were, was the May kay contract the next month not is not always June, it depends on the commodity. It might be July. So I would look at the next commodity chart, then expiration month. Sometimes the trade signal wasn’t there. So that would happen a lot. Well, it would happen enough that I wanted to study and learn what that stuff is. The good news is that the technolo technology kind of caught up and populated everything. So I kind of knew where I would want to start unwinding trades or not even put them on because of this thing called first notice. But what’s going on behind the scenes for me with all of this is that is the main takeaway for today is not to study first notice, who cares? It’s that the most important stuff in your day you should do first in the morning. That’s how you would prioritize. Talk a little bit about intention equals results and time blocking. And in the
Time blocking space, you want to make sure that you are in fact putting the most important things that you should be doing for yourself in the earliest part of your day. Because you always want to make sure you can get done the most important things as days go on. And as time transpires throughout the day, you might have something happen to you in your business or in your personal life that throws a wrench in things and precludes your being able to do what you want to do. And if on your schedule you had these really important things to do, it can create a big conflict and that could impact your life. It could impact your trading. Obviously force maur and random events happen. You can’t escape and they’re going to happen to everybody. But that’s why I feel like first thing in the morning, what do I do is largely exercise.
That’s when I typically go do my cardio because it’s important to me and I want to get it in. Yes, I know you probably know by now that I study martial arts, but that’s largely anaerobic, right? It’s mostly position. It’s not even about muscle. I mean, you need some athleticism, but you need good technique is what you need. So I don’t need, yes, you need grapplers cardio for sure. But anyway, so I do my own cardio in the morning and then I’ll do my review. Obviously this is very early because I’m in la, just review my orders to make sure there’s no typos or again, I haven’t screwed up the first notice thing or this and that, and I do the review because then it doesn’t cascade, right? And because that’s the most important part of the trading is the risk management, is knowing that and double checking the position sizes, which I largely do unlike a spreadsheet, on a spreadsheet or through the simulator. But then, you know, want to just double check your math to make sure that you absolutely have stuff nailed down. So if you’re struggling with things, maybe what you can do then is isolate the things that you do during the day that you know or you can attribute your success to, and make sure that those are happening earlier in the day than later. Please like and subscribe to the show folks. I appreciate you being here. Keep the comments coming and I’ll see you tomorrow.

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