Getting Back On Track With Persistence and Perseverance
Direct focus on better systems
This post is about rebuilding momentum after setbacks.
I closed 2024 with clarity and determination, excited for what the new year could bring. Only days later, a series of events left me in shock and clouded in uncertainty.
To compound matters, a rather serious illness took hold of a family member.
Suddenly the big-picture goals and to-do lists that I had set with such energy were paused. They were completely unrealistic, especially in my new circumstances. I lacked both the time and energy to dedicate to any of them, which only intensified the pressure I felt.
With scattered focus and reduced preparation, I did place some trades on the days when I could steal a moment. I lost 7 times in a row. This was the clear message I needed to shut down and be fully present elsewhere.
In the past, I have been a big proponent of setting big-picture goals. However, the more I think about it, the more this exercise feels like a complete waste of time. Too many goals are a distraction and get lost in time. They lead to diverted attention and chasing shiny objects.
Instead, the focus should be on building better systems.
As a trader in this high-performance field, you should strive to create an environment of “sustained excellence”1. This comes from baby steps and small improvements all adding up.
Obsess over this and eliminate everything else.
Scattered focus? Build a better preparation system.
Missing stops or in drawdown? Build a better risk management system.
Making the same losing plays over and over? Build a better review system.
Obsessing over trading at the end of the day? Build a better shutdown system.
Struggling to publish the Substack every Sunday? Build a better writing system.
It was listening to a podcast with Dr. Tom Crawford on Investors Underground that reinforced these principles for me.
Life is tough. Trading is tough. Everyone is experiencing their challenges. However, if you approach this career with the right attitude and persevere with a focal point on building sustained excellence, then you can work your way through these periods.
Here are the major lessons I learned from the talk that may give you direction and better help you navigate your challenges for the year ahead:
1. Smash self-doubt with persistence and perseverance
You must have the resiliency to hang in and experience failure.
In trading, there will be bad days, weeks, and months. This is all part of playing in a probabilistic game. Sometimes the market gets tough and edges stop working. At other times, your own human fallibilities compound problems. Losing is a constant.
The way through this is to build the confidence to persevere and persist.
This is easier said than done and doesn’t come naturally to some. At high-performance levels, 75% or more of the game becomes a mental battle. What blocks established traders is not necessarily talent but mental barriers that include:
→Self-doubt
→Scattered focus
→Self-limiting beliefs
→Performance anxiety
→Getting stuck on mistakes2.
The good news is that these are all trainable. The key is to view them as skills rather than insurmountable blocks, which can be improved through consistent practice. It is persistence to keep going in the face of such challenges that fuels improvement.
Pick one barrier and work on it exclusively.
For example, I am currently experiencing self-doubt. My performance has been inconsistent of late and I am now trading in a new environment which takes an adjustment period. The initial solution is to go over stats, reflect, and prove that I do have an edge and that I can be consistently profitable. It is to identify what is making me money and the conditions. It is also to pinpoint specific weaknesses or shortcomings. From here I can change my self-talk and focus on a better system each day. The effort must be channeled into the most meaningful to get results.
It all comes back to persistence and the perseverance to want to get better.
It comes from being a professional.
2. The starting point is to be professional and to commit to excellence
You must treat trading as a profession and consider yourself a professional.
This is because trading, especially day trading, requires an incredible amount of cognitive acuity, cognitive intensity, and emotional control all at the same time. It demands an edge, infrastructure, technology as well as experience.
If you don’t approach it professionally, it is going to be very tough to be successful.
Only last week, I logged in later than usual because of disruptions and barely had time to prepare. I was at my home “setup” in the kid’s playroom, with my 5-year-old daughter drawing in the background. I missed every routine and habit. The focus wasn’t there. Needless to say, it resulted in a quick sharp donation to the market.
Cutting corners very rarely pays.
Being professional means organising your life and environment in a way that allows you to perform to your highest standards. It is to dedicate yourself to getting better.
As Dr. Crawford says:
“There has to be a commitment to excellence…that means the way you approach your trading has to be the way a professional would approach any highly skilled profession. You have to build habits of excellence”
For example:
What does your prep look like?
What does your focus look like?
What does your infrastructure look like?
Do you have a proven edge?
Do you have a risk management strategy that you can stick to under pressure?
How do you review?
How do you channel meaningful work to get results?
All of these areas compound. You can’t just wing it and expect to make some cash. Even if you do, you are definitely not going to be able to sustain it.
Professionalism is a dedication to your craft. It is the desire for continuous improvement.
That motivational orientation all by itself is part of high performance.
3. There is a common trait shared by all of the highest-performing individuals
The best-performing athletes, high-performing CEOs, high-performing surgeons, and high-performing traders can all be characterised by their ability to focus.
Traders go from trade to trade day by day. The best get back into their zone and execute. They zero right back in on the next challenge.
The average player loses their energy and gets easily distracted. They get emotionally involved in a trade rather than accepting the price action.
Fear of missing out or overtrading? That is a loss of focus.
Making mistakes? That is a loss of focus.
Diverting attention to every ping, headline, or call out? That is a loss of focus.
The truth is that only a small portion of your trades will make up your entire P/L. As a consequence, it is so important you maximise these moments. This comes about by doing less and doing it better. You don’t need 10 depth screens open. You don’t need to trade every stock with news. What you do need to do is focus on the most meaningful for your system and accept there are other moves outside of your control.
This is a skill that is not often touched upon but again can be trained. Build routines and habits to get you into a state of flow at various moments throughout the trading day.
Increase self-awareness to be a calm, confident, disciplined, and process-orientated trader. If that is your approach to trading every day, you get better, and it becomes easy to manage the pressure.
4. Its ok to be disappointed but do not be discouraged
There is an important mental distinction between accepting losses and mistakes as a potential learning lesson versus devolving into a state of despair.
The lows suck. No one enjoys losing.
Disappointment is dissatisfaction with performance and an acceptance that we can be better.
Discouragement is an attitude of “what the hell is wrong with me”. This nails you and it becomes much increasingly harder to come back in the following days with energy and purpose. It can take hold of you and form a negative feedback loop.
You have got to make mistakes and lose money to learn. The disappointment fuels growth. This attitude makes you want to work harder and see challenges as part of the journey.
Billie Jean King, one of the greatest women tennis players of all time, said to Dr. Crawford:
Pressure is a privilege. There are alot of people who go through life and never have that experience
That is a very powerful perspective.
Pressure is putting ourselves to the test and experiencing. Trading gives us that opportunity set almost daily.
Turn disappointment into energy to fuel growth. Instead of getting discouraged, work harder at it to get better.
5. Burnout is real. Attend to what you need to do and build a shutdown routine
Obsession is necessary BUT you have to know where to draw the line and shut it down.
To build a virtuous cycle of energy and to consistently perform, you have to respect the rest and recovery cycle.
Some markets are open 24/7. Our phones keep us alerted to every headline and move. There is a temptation to be across it all and chase the next big thing into the night. You may be able to get away with this for a night or two but you can’t sustain it.
Again, as a trader, you need to be focused over long periods day after day. Recognising this, you need to build a rhythm so that you don’t burn out and you don’t kill yourself by comparing yourselves to others.
Dr Crawford calls this “crossing the bridge”. Have a ritual at the end of the day where your journal, you learn and get better, but then you must shut it off to cross the bridge. Pull joy out of the rest of your life because that fulfillment feeds the energy and cognitive acuity to be a great trader the next day.
This will look different for every trader. For some, it may be getting on the train or hitting the gym, for others it is walking in the door to the wife and kids. At this point, everything else is out of your control so enjoy the new moment.
Conclusion
As I get back on the desk and begin the new year once more, the attention will be on small improvements each day through refining my systems. Gone are the big-picture goals to 10x sizing or hold the next big catalyst trade from open to close. Instead, if I maintain my professionalism and focus, I trust that the results will follow.
What could you do better to increase your trading professionalism?
https://www.investorsunderground.com/dr-tom-crawford-interview/
Tweet by Alex Auerbach @AlexAuerbachPhD