Utopia vs Reality.

Sept. 16, 2023, 11:22 a.m.

In the world of trading and investing, the pursuit of perfection often collides with the harsh reality of financial markets. It's a journey where the dream of winning every trade clashes with the inevitability of losses. This quest for a flawless strategy can lead to moments of euphoria when everything seems to click, only to be followed by the sobering reality of setbacks. However, it's in these very setbacks that valuable lessons are learned. Trading is not about achieving a 100% win rate but about making well-calculated decisions and managing risks. Let's explore some fundamental principles that bridge the gap between utopian trading ideals and the reality of the financial markets. Here are some key points.

1. Winning every single trade is technically and organically impossible. 

No matter how accurate and well-developed our trading strategy is, it is certain that we will be encountering some losses every now and then for some reasons beyond our control (market manipulations for instance). It is possible to have a streak of wins, which could set the bar of Win Rate at 100% (April 2023 and July 2023 trading logs) and seem like the code has been cracked and that no losses will ever be suffered again; however, what could follow right after, a mild losing streak, would be the biggest example of how losses are an inalienable part of the journey regardless of how neatly-back-tested and perfectly-established your trading plan is. 

Instead, it is more beneficial to focus on capturing high risk-reward trades while risking only a fixed percentage amount of the total capital per transaction. After all, trading is a game of probabilities that involves making well-calculated decisions and letting the market do the rest of the work.

2. Live to learn and you will learn to live.

Oftentimes in the markets, the ego-self kicks in and tricks us into thinking that we know everything. However, this perspective is very far from the truth. Through hardships and mistakes, we will keep upgrading and becoming better.

Therefore, know your onions, but do not be afraid of further educating yourself in the markets. Personally, we have been operating within the boundaries of this industry for more than 4 years. Even by doing so, we never stop exploring, learning something new, working on filling in all possible loopholes, and aspiring to become only 1% better day-by-day (those 1% growth points add up and contribute towards a radical change, both mental and physical).

Hence, aspire to be better by only 1% compared to the preceding day, and watch how things experience a rapid shift.

3. Although the idea of making “quick profits” is not a myth in theory,

the motive of this point lies within the notion of sustainability. You may chase cheap dopamine's and endorphins provided by the euphoria of securing quick bucks; however, consistent profitability in the long run should be earned with pain and struggle.

Take, for example, the trading journey of ours. We do have times when trades, after running in good profits, reverse and hit our breakeven point Stop Loss, resulting in neither generating profits nor suffering losses (apart from commissions and swaps). Instead of rushing into making quick closures and securing the already made profits, we tend to stick to our plan and let our trades play out as according to our orchestration. This gives us the keys to the doors of long-term consistency and profitability since we know our back tested and thoroughly practiced/optimized strategy works as the judge, the jury, and the executioner.

4. Rome was not built in a day. 

I always say this, had it been that easy, everyone would have grabbed their smartphones and made money from the comfort of their home. Becoming a doctor, an engineer, a qualified lawyer - all take years of study, practice, and hard work. What makes people think it is gonna take a couple weeks of YouTube research and Reddit scroll-through to become successful in this industry?

Nothing worth fighting for comes easy. Blood, sweat, and tears should be invested to benefit from the fruits of long-term profitability and prosperity.

5) Actually, an easy path to the throne is achievable....

but only if you are a part of an autocratic society where injustice prevails. Think of it in terms of being appointed as the head minister of your village and being inherited all the wealth and royalty just because you are the son of a deceased monarch-ruler. An easy path to the throne? Yes. Sustainable and wortwhile? I would doubt it.

Through suffering hardships and facing obstacles do we become resistant and wise. In trading, through losing streaks do we gain experience and become better.