What Is A Trader’s Job?

2020-06-19 | Simpler Trading Team

There is a long-standing motto at Simpler Trading that says:

“You can be right, or you can make money.”

The only job for a trader is to make money.

At Simpler, this translates to making sure the equity curve on a trading account profit and loss sheet rises from left to right. This shows the account is growing, i.e. making money.

We work daily to build and maintain a trading lifestyle and share that process with others. Our “job” is not part of the traditional labor force.

The market guides a trader’s training, daily routine, and goals.

As traders, a big part of our job is to listen to the market and react to what it's telling us. It’s futile to take on the market and attempt to impose our will based on what we think should happen (like a manager in a corporate environment).

Every day we strive to understand what the market is telling us. If we miss the message, then it's a very clear message to stop and reassess.

The job of a trader is NOT to always know where the market is going. It is not the job of a trader to catch every move.

It IS our job to have logic behind the trades we take.

And when the market doesn't match what we've come to expect, it's fine to wait until it does, or until we take the time to study a new market pattern and develop new expectations.

It is also important to remember that we don't need to understand WHY the market is moving. There are many times when the market will fail to make sense (like recent extended uncertainty and volatility).

What we as traders should work to understand is HOW the market is moving and to identify patterns which we recognize which lead to repeatable, reliable trade setups.

Once a trader realizes that market moves rarely conform to economic logic, it frees us up to watch price action and trade.

We Saw: another roller coaster day for markets — 

  • Covid-19 cases causing renewed retail woes
  • Mixed market gains and losses
  • “New normal” looks to change business, culture

We’re Watching: cash positions and being flat into next week —

  • Seasonality of markets signaling weakness soon
  • Whether mixed reopening data kills market steam
  • Continued plays: JPM, APPL, TSLA, NKE, LLY

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