There just isn’t enough time in a day to get everything done. This is especially true when it comes to trading. There are numerous trading strategies, and you can easily run out of time if you try to learn them all. There are endless possible trading opportunities to look for, and when it comes to trying to look at all the available information about the market, it can be overwhelming. It’s vital to set priorities, make hard decisions about what you want to do, and focus your energy on achieving those specific objectives.
In many occupations, the more work you put in, the more payoffs you’ll realize. If you are in sales, the more cold calls you make, the higher your potential sales. If you are a construction worker, the more hours you put in on the job, the more money you take home each week. In many ways, trading is quite different. There isn’t a one-to-one correspondence between the amount of work you put in and the profits you’ll pile on. You must prioritize. For example, you don’t need to spend several hours monitoring media coverage of the market if it doesn’t directly lead to a profit. Most of it is for entertainment value only, so spending hours reading or viewing the latest media hype is a waste of valuable time. You need to work efficiently and make sure that the time you spend learning about trading and the market does indeed pay off.
Trading isn’t a 40-hour a week job. It’s not a matter of putting in 40 hours a week and getting a steady paycheck. It’s about reaching a specific objective, no matter how much time it takes. For instance, if it takes only 15 minutes for a skilled trader to make enough profit to have a year’s worth of living expenses, so be it. Seasoned traders don’t have to spend 40 hours a week to make a living if they have the requisite skills (and novice traders may need to put in more time building up these requisite skills). The point is that if you’re a novice trader, you can’t work under the assumption that everything you do will have a direct payoff. There are only so many hours in the day, so you must spend your time efficiently. Don’t waste your limited time in activities that won’t have a direct payoff.
For example, if you’re an intraday or swing trader, it doesn’t make sense to read about the markets and world events that have no direct bearing on the intra-day or intra-week prices of the stocks you want to trade. Similarly, sifting through stock charts that have no bearing on the stocks one trades is also time misspent. Avoid information overload. You need to maintain focus and efficiency. Trade a few key stocks, and know everything you can know about those key stocks. Become an amateur specialist. Memorize the chart patterns, how the prices fluctuate during the day, and the factors that coincide with the price changes. Knowing about stocks you don’t plan to trade or about broader economic events that don’t influence your key stocks will take the time that, realistically, you just don’t have.
Trading is a challenge that requires hard work and persistence. It is essential to manage your time and energy wisely. Focus on what matters most. Don’t be distracted by learning additional trading strategies that you will never use, or new indicators that are redundant with basic indicators of trend. And don’t believe you must keep up with all the media hype. Working efficiently will ensure that you will build the skills you need to become a consistently profitable trader.