Nearsightedness, or myopia, as it is medically termed, is a vision condition in which close objects are seen clearly, but objects farther away appear blurred. - American Optometric Association

Every now and then, it’s appropriate to regain some perspective in life.

And based on some recent mail, it’s time to once again try to put my ongoing babbling into perspective … using my favorite concept of “time”.

Throughout the last decade, I’ve likely preached more about the concept of “time” more than any other single topic.

Two prime examples include the famous January 2009 “Svithjod Rock” post (which was subsequently asked to be syndicated and appeared on the inside cover of the 2009 International Trader Expo Directory among other places), and one of the first slides of the Jellie Training series which states, “Trading is all about a Long-Term Accumulation of Short-Term decisions”.

The main reason I tend to get “soapboxy” about this concept is that the vast majority of people on this planet – and traders-in-training and losing traders in particular - continue to miss the point as they remain interested primarily in short-term, microwave-type results.

Such is why (1) I revised the tone of this diary some time ago from immediate data/results intensive to more substantive intensive, (2) I’ll only offer live trader training over an extended four-week period which MUST include my live trading, and (3) I’ve been so cautious with the Trading After Dark (TM) launch so as not to provide even a single hint or inference that results over a single day, week, month, year, (insert other microscopic time period), etc. matter … because they don’t EXCEPT in accumulation over a very long period of time.

I was reminded of this again twice over the weekend when (1) I was getting ready for a Webinar that I’ll be giving Linda Raschke’s team next Wednesday, and (2) I received requests over the weekend asking for some detailed statistics and the posting of daily results.

The latter of which falls in the “give a mouse a cookie and he’ll ask for a glass of milk” category since I’ve sliced & diced both micro and macro results via an array of published statistics, tank transcripts, diary entries, 38 weeks of live team trade narration in 2009-10, and actual trade plots ad infinitum over the years.  And I’m STILL looking for someone else to publicly share their horror days. But I digress.

You see, short-term numbers – whether good, bad, ugly, or indifferent – mean absolutely nothing. 

Zero.  Nada.

Let me try the following analogy.

Many outside of New England don’t care for Bill Belichick.  His press conferences are dull, he wears the infamous “hoodie” instead of fancy sideline garb, is almost robotic in nature, and his tone never waivers whether they won, lost, played well, or stunk up the joint.

He’s not fancy or flamboyant, and his players follow suit.

Oh, and over the long-term, he wins.  Boy does he win.

Yet most in this world would apparently rather see the “pizzazz” and “excitement” of  a Rex Ryan.  Or dwell on current-day results. Or simply see how their “fantasy” team is doing.

And such is true with trading as many traders continue to care about the “glamour” of trading, especially in the context of the immediate trade, day, week, month, year, (again, insert microscopic time period), etc. of both their results and the results of their “fantasy” team.

And while I’ve tried to say it before a thousand different ways, I’m going to try yet one more time.

ANY of these more than 800 diary posts by themselves means nothing. 

Each extended streak during 2001, 2002, 2005, the self-imposed “challenge” year of 2008, and parts of 2009-10 by themselves means nothing. (btw, note the gaps gang!)

The July 7, 2008, October 6, 2008, and May 6, 2010 Days From Hell (among others) – while published with clear intent – by themselves mean nothing.

My burnout during 2006, mid-2009 and lack of trading interest/passion during parts of 2010 by themselves mean nothing.

Yet I share each of these micro-instances with the hope that it’s the ENTIRETY that onlookers “get”, and therein lies the ONLY value of this ongoing babbling.

And yes, even I must be reminded of this during times when I’m staring at the “performance” tree and not the forest … or more appropriately, the world.

Which in fact happened this weekend when we were doing some longer-term fund comparisons to the Barclay benchmarks, when I was reminded that through all of the micro-timeframe snippets noted above, my main fund has generated a Total Return to date (as defined by Barclay) of over 800% over the last several years (including pre-blog years).

btw, the worst peak to trough drawdown (again, as defined by Barclay) over the last five years?  5.26% … a figure that probably means more to me than anything as “defense wins championships”.

I debated long and hard about sharing these figures.

And while I’m sure they’ll get twisted, distorted, doubted, misinterpreted, etc. by a few who again just “don’t get it”, it’s the best way I know to properly “bind” each of the 800+ pages of this electronic book with emphasis.

And perhaps improve our collective “vision” in the process.

Let’s keep our eye on the ball as we enter 2011 gang.

It’s the only way we’ll ever hit one out of the park.

I wasn’t going to do a post tonight for a few reasons.

First, my trading sucked today.

Oh, I read the market really well, but the hand/eye/brain connections seemed severed as I woke up feeling out of sync.

In fact, it was as out-of-sync as the supposed all-world Lebron & Company (a.k.a. Miami) Heat were in tonight’s NINE point first quarter against the Celtics.

The good news is I know why – which I’ll go into at a later date, although it had to do with talking to another trader - and will be taking corrective action immediately.

Other good news is that I didn’t do any great capital damage, and also kept fighting to the end, tallying 1,700 contracts on the day.

And even though, as The Next Iron Chef (one of my favorite shows) emphasizes each week, even world-class chefs have bad days, I was feeling pretty disgusted about today’s trading … and frankly, today in general.

Now, before I continue, let me reinforce the fact that this blog has always been about 100% balanced reality.

Scroll through the last 28 months of blogging and over ten years of industry columns and speaking, and you’ll see soapbox after soapbox about my trading screw-ups and errors.

I do so because even though such periods of poor performance are far surpassed by the successes from a financial perspective (and for those who still don’t “get” this business, that last sentence FULLY defines the business of trading), the defeats are a very real and necessary part of this business that few ever want to share.

Having said all that, I’m going to share a heartfelt email from a longtime blog onlooker (a non-student who I’ve never met) that I’ll say right at the top is in no way intended to be self-promoting.

Yes, I’ve formally educated traders off and on throughout the last decade and may continue to do so from time to time.  Yet right now, I’m simply in trading mode. And if you missed the above content, I’m human and gaffe with the best of them … although I do “get” the definition of trading referenced above, and perhaps therein lies the difference.

Yet tonight, I admit I was feeling rather “low” and needed a morale boost.

Then this came:

Given that you are about to take the generous gift that is the sharing of your knowledge to another level again with the Trading After Dark project, I feel that now might be an opportune time to express my wholehearted gratitude for the help that you have given me over the last few years.

I have spent the last ten or more years learning to trade and in the process trying every conceivable method and instrument, blowing up many trading accounts and much blood, sweat & tears along the way, not to mention giving up an established professional career to drive a delivery van on the graveyard shift to be able log the valuable screen time I needed.   

Through trial and error I got to a point where I realised I was best suited to trading futures on a short term basis (i.e. lost the least amount of money) in a fashion extremly similar (though far less successful and disciplined) to yours. 

Having said this, I spent another couple of years in the two steps forward, six step backward phase graduating to the two step forward, two step backward phase you have mentioned.  In about August 2008 just as finances and my very patient family’s support both started to waver  I happened upon the blog.  

I was captivated by this trader who was confirming everything that it had taken me so long to learn about what was really important when it comes to trading but wasnt just talking the talk, he was seriously walking the walk.  Though I hadn’t found consistent success by this stage I had learned enough to be able to distinguish the “smoke from the mirrors” and I knew I had found the real deal. 

I devoured every word, hitting the blog so often I feared being perceived as some kind of deranged cyber stalker.  With your inspiration and your words ringing in my ears I continued on (while resuming full time work to feed my family).  Now I can’t say a light bulb went off suddenly, but over a period of time slowly things started to change.  Wholesale/Retail.  I had probably read these words a hundred times in your blog without any real insight but somehow, something finally clicked.  

The profound effect that this new mindset had on my trading once It finally sunk in to the absolute core of my understanding and not just on a superficial level has been nothing short of amazing.  Sure, I could read the chart patterns but what I didn’t realise was, for example, waiting for some form of “trigger” before entering the trade, (as is continually taught) nearly always had me entering on the verge of retail.  Confirmation = Retail!

Now that my mindset has changed I rarely take more than a few ticks of heat on a great majority of my entries.  It has taken away the pain (emotional & financial) of always feeling I was constantly on the wrong side of the market and getting stopped out just as the market turned back in my direction. With the patience and discipline to take only “my (wholesale) price” or nothing and varying my position sizes to “maximise the good and minimize the bad” I have managed to record 6+ month results that include only one losing week since April this year. 

Of course I am constantly vigilant about staying focused and I know I need to continue working even harder in the future. (I have the Og Mandino quote posted to my office wall). But having said that Don, even the results I have managed to achieve so far have made a huge difference to my family and I.  The extra income derived from my success has already enabled me to provide opportunties for my two young daughters that would have otherwise been unavailable. 

I can state unequivocally that had it not been for your inspiration I would not have kept going and if not for your teachings I would not have figured it out. 

So thank you Don, from the bottom of my heart.  For your unbridled generosity.  I can only hope that in the future I might also be able to give back in someway just as you have.  

In closing I would like to attached a favourite parable of mine that I think sums up what you have done and what you are continuing to do for the trading community better than I could hope to.  Perhaps we just need to change the word starfish to jellyfish!
  
There once was a wise man who used to go to the ocean to do his writing.

He had a habit of walking on the beach before he began his work.

One day he was walking along the shore, as he looked down the beach, he saw a human figure moving like a dancer. He smiled to himself to think of someone who would dance to the day and he began to walk faster to catch up.

As he got closer, he saw that it was a young man, and the young man wasn’t dancing, but instead he was reaching down to the shore, picking up something, and very gently throwing it into the ocean.

He called out, “Good morning, what are you doing?”

The young man paused, looked up and replied, “Throwing starfish into the ocean.”

“I guess I should have asked; why are you throwing starfish in the ocean?”

 “The sun is up and the tide is going out. And if I don’t throw them then they’ll die.”

“But, young man, don’t you realize that there are miles and miles of beach and starfish all along it. You can’t possibly make a difference!”

The young man listened politely, then bent down, picked up another starfish and threw it into the sea, past the breaking waves and said …

“It made a difference for that one.”

-Author Unknown-

Yours Sincerely,

B.T.

Yes, I’m human … in every aspect.

After reading this, my day admittedly got a whole lot better.

I guess it makes all this babbling worthwhile.

May we all get sore arms from throwing starfish.

Have a pleasant evening.