Endurance: The Cousin to Patience

I've been putting off writing this post for a couple weeks now. Sometimes, I can be the worst procrastinator I know. It really is frustrating.

In my last post, I wrote about Patience, and how one of my biggest faults as a human being is my lack of said patience. Today, I wish to share with you my thoughts on a closely related topic - endurance.

While the act of patience requires one to go with the flow and to base your actions with the big picture in mind, the struggle you often face is finding the strength to keep moving forward when strong headwinds blow in your face. It sometimes takes every ounce of power you can muster to keep the wheels spinning and the car on the road when the road takes unpredictable turns, ups and downs, and on top of all that, the road is covered in a sheet of black ice! This takes endurance to focus.

I was reminded of endurance since my last post. Since I last checked in with the performance of my trading on October 18, I have realized an 18.1% gain. Not bad for nearly 7 weeks. However, one very important thing you don't see in this number is the fact that my trading account suffered a 17% drawdown from the highs - and it only took 5 trading days to get there. It took me just over a full calendar month to regain my previous high. During the period of recouping my losses, I found solace in knowing that with just a few small tweaks, I'd be able to right this ship and get headed back in the right direction again. I had absolute confidence in my plan and knew that over time, these will just be small bumps in the road. My perseverance paid off, and today we're back at new highs.

The struggle for me is this: Since late this summer, I have completely turned around my trading and have settled into a groove that is yielding spectacular results. We are talking annualized percentage gains that are too embarrassing to publish because they don't look real and you probably wouldn't believe me. This is a good thing, right? Yes and no. The problem is that although I am employing a great strategy that is highly scalable (meaning, any Trader should be able to trade the same way I am regardless of whether he is trading a $1,000 or a $1 million account), I'm still trading with an account that is too small to enjoy the rewards. All the gains that are being achieved must remain in the account so that I can continue to grow it so that it can get to a level where I can then begin regularly withdrawing cash to spend as we please. Its frustrating performing so well, yet still having to live extremely frugal and continuously make "either/or" decisions instead of making "yes/and decisions." Instead of saying: "Yes, lets go to our friends' wedding in Mexico this March AND buy tickets to that concert we want to see next week;" these days, we're always saying: "We can go to this Christmas Party, OR we can watch the game at the bar on Sunday - but not both, we need to buy groceries."

So, I'm faced with the very real situation of having to ENDURE the time it takes to get from Point A to Point B. And the trick to do this is to stay COMPLETELY FOCUSED on the method that has fueled my turnaround, ignore the dollar balance of the accounts, and minimize real-life distractions along the way that inevitably get me thinking about whatever may be wrong outside of work, but not about what is right and working on a daily basis.

The one thing that keeps me motivated is knowing that the in the end, the Journey will have been totally worth it. My line of work is one of the hardest professions to master. The road to Market Wizardry is littered with thousands of well-intentioned (and some VERY well-funded) carcasses of once promising individuals who believed they had what it took to make a living as a Trader or Speculator. But despite the challenges and long odds against the majority, the few who make it are true masters of their universe. I don't mean to imply they are Gods or some kind of superhuman. I mean that the ones who truly make their living in the markets have the best jobs in the world. In fact - to them (dare I say "us"?) - trading or speculating isn't even a job. It's something they love to do. And nobody can take their job away from them. They are their own boss. They can trade any market in any country they want. They can trade in boom times and in recessions. They can trade whenever they want. They can vacation whenever they want.

This is true freedom.