The Weekend Trader – Trading Lessons From the Cup

Sunday 6/19 Update – For all traders over 40, or for those younger who have been told they’re not cut out for this biz, you HAVE to watch this morning’s Parting Shot by Bob Ryan on ESPN’s Sports Reporters discussing Tim Thomas.

Oh, and the weekly PivotPoint Briefing has been posted in the PP Briefing Room tab … and Happy 19th to my daughter Chelsea … and Happy Father’s Day to all Dads!!
Yes, I’m a sports fan.

I’ve supported pretty much every local pro and college team near where I’ve lived which includes the New England, Seattle, Dallas, and Madison, WI (Go Badgers!) areas, but I admit hockey is my first love and I bleed the black and gold of the Boston Bruins.

You see, I have since I was eight years old. 

And I’m far from alone on this … Exhibit A being this absolutely wonderful piece by ESPN’s Bill Simmons.

For you “youngsters”, watching hockey in the late 1960s often consisted of snuggling up to a black and white 14″ TV and trying to find the puck through the snowflakes of UHF (young folks can Google that!) transmission.

It consisted of trips with my Dad to the old Boston Garden (or as I used to say, “Gahden” before I lost my Boston accent in my many years of travel) in obstruction view seats behind a pole or in the nose-bleed seeds of the rafters among the Garden rats.

It consisted of playing street hockey in my driveway where I was goalie and my best friend of Chara-like size would fire shots at me, often breaking every window of the garage and adjacent porch … after which time my parents would simply replace the each window with plexiglass.

It consisted of having Bobby Orr as my hero given his combination of skill, grace, and personal humility.  And yes, he’d drop the gloves and stand his ground when absolutely necessary.

It consisted of sneaking an AM radio under my pillow at midnight when the Bs were playing on the west coast.

And despite two championships in the early 1970s, it often consisted of heartbreak due to some odd team malfunction at the most inopportune times.

So you have to understand where I’m coming from when I say I had a very enjoyable week.

And yes, there are many trading lessons to be learned from the incredible Bruins’ run for what is arguably the most difficult trophy to win given the grueling two-month campaign after a full season … and I’ll use parallels to my own trading to illustrate.

In the finals, the Bs were not the more skillful team … that would go to Vancouver who had the so-called “pedigree” of high scorers, and more than a fistful of “bests” in terms of regular season statistics.  In fact, the comparison wasn’t even close. 

And then Vancouver got out to a two-game lead in the finals, at which time all of the historical probabilities were heavily tilted in the Cannucks’ favor.  After all, the Bruins would have to win four of the next five against the best team in the world who had home-ice advantage on their side.

And then they blinked.

Vancouver thought they could simply “show up” to finish the job, while the Bruins dug deep and found their “heart”.

The Bs won Games 3 & 4 in a lopsided manner on home ice to tie the best of seven series at 2-2, lost a 1-0 nail biter in Game 5 back in Vancouver, and then once again won 4-0 in Game 6 back in Boston to set up a winner-take-all Game 7 back in Vancouver.

Yet the mistake Vancouver made was to simply believe that all they had to do in Game 7 was to show up.  In interview after interview, their mantra of “don’t worry, we’re going back home and will be fine” was repeated over and over again.  You really got the feeling that all they had to do was lace up their pedigree skates, and they’d be hoisting the most famous trophy in all of sports.

But as the Bruins grinded and grinded them into submission in Game 7 minute by minute, it was clear that hard work and “heart” (remember that Annie Duke interview?? … a must read for traders) trumped historical pedigree, overwhelming probabilities, and skill. A 1-0 Boston score after an extremely hard working goal later became 2-0, then 3-0, and finally 4-0.

There are of course stories like this everywhere where the hard-working and resourceful underdog overcomes all odds to win … from David vs. Goliath to the 1980 USA vs. Russia Miracle on Ice to - now, the 2011 Stanley Cup Champion Boston Bruins.

OK, what are my trading lessons from all of this.

First, hard work trumps historical pedigree.  You see, by my definition, I’m not the most “gifted” trader. For I have to earn every penny via sweat and toil, while staying on guard to both protect and grow it. And despite my many market successes, I frankly and completely suck when I think I can “just show up” and sleepwalk through a trading day or week.

Second, despite the statistical odds against trading success due to the constant transfer of wealth from the vast majority of traders who “don’t get it” to the small minority who consistently win, never underestimate your potential to cross that thin line (Remember our Bamboo roots!) or listen to the naysayers.  You simply have to work harder than everyone else … and all the time.

Third, make your trading a self-proclaimed personal competition.  The initial trading journal portion of this blog is full of posts during my 2008-09 $2 Million run where I simply viewed that time as a personal “race” and pretended that I was constantly coming from behind. Remember that fictitious drawdown concept that has since become well-publicized and chronicled in trading journals?

And finally, celebrate and share your successes.

Tooday, there will be a parade in this city of champions (yea, we’re admittedly getting spoiled as the only city to now have a championship in every major sport in the span of seven years) where over a million people who similarly bleed Black and Gold will line the streets.

You see, deep down and like similar cities, Boston is a blue-collar, nose-to-the-grindstone working man’s town.  It’s a city where sweat, toil, and sacrifice once launched a historical revolution for freedom, and where those championships – like the 2011 Stanley Cup – rooted in hard work and humility are rewarded with particularly deserved celebration.

Reaching the pinnacle of your field is no easy task.  In 2008, I was blessed with a similar accomplishment in reaching the top of my field for trading performance among my asset class.  And yes, for one short day and post, I celebrated it … in part to recognize 366 days of extremely hard work and personal sacrifice, yet more so to try to inspire others to do similarly.  (btw, that Fireworks picture from that 12-31-08 Night to Dance post — one of the viewed posts of the blog – was actually a photo of fireworks in, of all places, Vancouver!)

Life is short, but the lessons are long.

Work, compete, and celebrate … but most importantly, Praise God, share the glory, and pay it forward.

For the latter will provide the greatest reward of all.

Congratulations to the 2011 Stanley Cup Champions … the Boston Bruins … and to all who overcome the “meaningless” odds to reach their fullest potential.

And yes, the $250 Jellie Trader Training Webinar discount remains in effect. Just email me at don@donmillereducation.com and I’ll email a special invoice.

And look for the weekly PivotPoint briefing in the Briefing Room tab over the weekend.