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Cutting Out The Noise

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by Gavin in Blog
April 5, 2013 2 comments

I received a great email recently from a reader about cutting out the noise. It really rung true and is something that everyone can benefit from. Here is the email:

“I have personally spent far too much time following Twitter traders, StockTwits, bloggers and watching CNBC looking for great home run trade. I almost never follow any of the suggested trades so the time/cost benefit makes the whole endeavor really just not worth it. Surprisingly to me best best swing and b/o trades have often been my own. 
 
A few months ago it dawned on me that my about 80% of my time was spent on noise and madly chasing tweets etc but it only accounted for about 20% of my returns. Meanwhile my quiet bull put spread service where until recently I really wasn’t paying much attention was accounting for the vast majority of my trading profits. Hence the shift to learning, fine tuning and determinedly focusing on spreads and iron condors.
 
Fortunately as these types of options trades are rather a niche part of the trading world and involve some degree of complexity and learning there is much less noise out there and therefore you can concentrate better on your own trading.”

What a great email, I think most novice traders have this issue and madly chase the latest trade idea or strategy. Keeping things simple and cutting out the noise is one of the best things you can do for your trading development. Focus only on those things that will make a difference to your trading at the time. Try not to listen to the the talking heads on TV too much and don’t chase the latest trading fad.

Happy Trading!

vol trading made easy

2 Comments
  1. thelonelytrader says:

    This is so true and very well put. (Bad pun, I know.) I analyzed my own trades recently and, while my insights were different, it was the principles and process described in the email that showed me where to focus. It’s a continuous process — I have no doubt that my areas of focus will change over time, but based on a consistent process of monitoring and evaluation rather than reaction to the latest trading fads.

    1. Gavin says:

      Well said lonely trader, completely agree.

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Options Trading 101 - The Ultimate Beginners Guide To Options

Download The 12,000 Word Guide

Get It Now