Podcast – Episode 44 – Fun With Discipline


Podcast Transcript

Hey, hey, hey, Genius Nation. How’s it going today? Coming to you today from the home office. Didn’t feel like going to work today and felt like relaxing. Trades are doing well, everything’s going well. And so, I’m here just relaxing today, but I did have this really, really exciting thought. So, I thought that, you know what, I need to record this. I need to get this down before I forget. And so, here I am. And, what happened was really that the last couple of coaching calls that I’ve had with clients, both of the fellows said something very similar and they both had a similar issue, which was that they are having a hard time adjusting. It’s not that they don’t know what adjustments to make, or they don’t have a trading plan that we gave them, but they are not sticking to the rules.

And so, they are not doing it properly and they’re not treating properly. And so, they’re having losses that they really shouldn’t have, and they know that, and they know it’s their fault. But, for some reason, whatever, they had their own little reasons. Oh, I lost track, or I didn’t have my records, or whatever not. They felt that their issue was that they could not stick to their adjustments. And, really it boils down to discipline. So, if you don’t have the discipline, you won’t stick to the rules, right? You’ll just try to do it fly by the seat of the pants. It might work, it might not work. But, that’s not the way that you want to be doing it. Now, discipline is like a muscle. It’s like a habit. I mean, the more you do it, the stronger it gets, the more ingrained it becomes in you, and the better off you are really in life.

But, I understand where these guys are coming from. Because discipline, not one of my strongest points. I would rather take the easy way out if I could in most cases. But, there are certain things that you can’t do that. There’s certain things that you really have to focus on. And so, when it comes to trading, it comes down to how serious are you, and how important it is to you. So, for example, both of these guys, they had a similar situation where there’s no real urgency in terms of, hey, I need to do a great job in my trading because that’s what I do for living. Or, I need this money to survive, or to pay off bills, or whatever. So, they’re basically dabbling. They’re not totally committed to it.

And so, it’s really a negative in itself, and that’s a telling sign that, hey, you’re not taking this seriously. So, if you can, stop dabbling, get serious, commit to this, and that will, for some people, that’ll solve their problem. They’ll just be like, yeah, you know what, I’m going to do it. But, the longterm way to overcome this is to really know your why. Why are you trading? What is the end result? What is the goal? What are you trying to accomplish? Is it, hey, you know what, I’m not going to have enough money in retirement and I need that, right? And, I need that money, otherwise I’m not going to survive or want to be dependent on other people to live, and that’s horrible. And, I’ll never want that to happen. Is that I need to pay off my debt? Is it I need to pay for the kids’ college? Or, whatever it is. I just need another thousand dollars a month to survive.

Whatever that is, you need to know your why, and you need to keep that first and foremost in your brain. And, if you can’t, put it up a big sign, or pictures or whatever in front of you or all over the place around your house, or on your computer or on your bathroom, so that you are constantly reminded, why are you trading? Why are you working hard? Why are you trying to get ahead? That will help you with the discipline problem, that will help you trade better.

Now, I do understand that if your goal is, hey, I need more money for retirement, that might be 10 years, 20 years down the line. And so, just human psychology tells us that we do not see ourselves as us 20 years from now. So me today, one person, when I think about me 20 years from now, oh, that’s a totally different person. I’m not worried about him. I’m more worried about me right now. And so, if I can not put off something and not have to do it, then I’d rather do that then work hard and be disciplined, so that the guy 20 years from now gets the benefit. I mean, I want the benefit now, right? I want instant gratification now. And so, by not paying attention to my trades, or watching TV, or just forgetting about them one day when I should be paying attention to them on a regular basis is, in a sense, it’s laziness. But, it’s human psychology. And so, I was thinking about that and I’m like, that’s the way it should be, that we should be focused on it, and have that why and be committed to it.

But, sometimes, it’s just not there, especially if you’re going from zero to 60, from not trading at all, not being disciplined at all, to be super disciplined, you can’t do it. And so, I’ve been working out with a trainer lately and basically, he’s starting me off at really, really low weights, three pounds, five pounds. We’re not going to 20 pound dumbbells because I haven’t worked out in 25 years. I can’t handle it. Right? I could do maybe one or two reps, but that’s not going to do anything. So, he starting me off small. And so, that’s where I got this idea. And, it’s something really fun and interesting and I want you guys to … this is going to excite you. So, this is one way that I think that, in a fun way, that you can overcome this discipline problem and start moving on the path to being more disciplined and having better off trades and sticking to the plans.

So, what I want you to do is not worry about your end game, not worry about retirement, paying off debt, whatever the issue is. What I would like you to do if you’re having this issue of not being disciplined and not adjusting on time and not paying attention, what I want you to do is to pick a goal or a item or a product that you want to buy just for fun. And, it might even be frivolous. It might be something like, oh, there’s this expensive watch that I want to buy or a piece of jewelry or, for some people, it might be a new car, I don’t know, whatever it is, but something that is just for you, just for fun. Something that you would probably not buy for yourself. And, we’re going to make that your short term goal.

We’re not going to worry about anything else. This is going to be your short term goal. And, what I want you to do is set that goal for, let’s say, three months, six months, maybe nine. You could do it for a year, but that’s really, really pushing it. I don’t want to go that far. Our goal here is to make you excited about something you want right away, and to help you build that discipline muscle. Okay? So I think if I tell you, okay, you’re going to retire 20 years from now, and you have to be disciplined every single day on your trades, that’s not going to excite you very much as to say that, you know what, we’re booking a cruise six months from now, and the only way that you can go on this cruise is if you make that money from your trading. Right?

I think that would be a lot more exciting to a lot more people. And so, a cruise, most cruises, seven day cruises, whatever, they’re going to run you around a thousand bucks or so per person. I think that’s doable, or even if they’re a little bit more 1,500 or whatever. But, I think, a one week vacation on a cruise, or maybe an all inclusive resort in Mexico or whatever, airfare, all that [inaudible 00:08:30], I think it’d be costing you about a thousand, two thousand dollars per person. And so, if you were to say, you know what, it’s me, my wife, my kids, or just me and my girlfriend, or whatever it is, this is how much money I need. I need a thousand, two thousand, three thousand dollars, whatever, to go on this trip, I think that is an amazing short term goal for anybody that is trying to build up their discipline, and who was trying to just get into that habit of checking on your trades, and sticking to the trading plan over and over and over and over again.

And now, in the short term, yeah, you’ll spend a little bit of money going on this trip, or whatever you want to buy, but in the longterm, it’s going to help you because we’re developing that muscle, we’re developing that habit, and that’s the important thing. You’re going to have a lot of fun, right? You’re going to be excited about whatever this thing is. It’s got to be something really fun. Something you probably wouldn’t do for yourself, or something that you thought, oh man, that’s a luxury. I wish I could do that. Well, let’s make that our goal. Let’s be a little childish. Let’s put our little responsibilities aside for a second, because right now, if you’re losing money on your trading because you’re not paying attention, well, you’re losing money anyway.

So, the thing, the goal here is you’re going to pick something that you really want, maybe frivolous or maybe a fun or something you’ve always wanted that’s kind of a luxury, probably, I would say $5,000 or so. So, maybe a car, unless you’re really, really rich already, maybe a car is out of a contention here, but a vacation or some kind of experience, maybe something that you’re really looking forward to a trip, going to see your grandkids, going skiing or whatever. It doesn’t matter. That would be your goal. That would be something that could excite you. And then, you set a timeframe. So, okay, I need to do this within three months. I need you to do this in six months. Depending on how much it costs and depending how much you’re trading account is, how much you think you could make every month, six months, nine months, hopefully not a year. Don’t go past a year. Because then it’s not going to excite you that much because it needs to be simple and it needs to be soon.

The more sooner it is, the more excited you’ll get. So, if it’s, let’s say, six months from now, you look at your trading account and say, okay, you know what, I need X amount of dollars. Let’s say $4,000 for this. I need to make that. So, I need to work. The only way I can pay for this thing, this trip or activity, or whatever it is, is by making money from my trades. That’s the only way I can do it. And, the only way that’s going to work is if I pay attention, right? If I focus every single day, and if that’s the case, if you’re going on a cruise, I mean you get cruise ship pictures and beach pictures and whatever and you just post them. Post them around in place so that you always have that top of mind. You always remember, hey, this is what I’m doing, this is what I’m doing. I’m going to have a lot of fun on this trip.

And, that will excite you to the point where, okay, I need to check every day. And, you check everyday. I need to focus on my trades. And so, when the times comes for an adjustment, you’re not going to be thinking, oh well, maybe I’ll just put off the adjustment. Maybe it’ll come back. Say, no, I cannot afford to lose money because, if I lose money, I’m going backwards away from my trip. This is too important. My trip is too important to me to not make this adjustment, and not stick to my trading plan. I’m not going to wing it. I am going to do what I need to do to be profitable, to be consistent so that I can go on this trip. Right? And that’s all we’re trying to do.

So, if you’ve had problems in the past with discipline, with not adjusting properly, sticking to your trading plan, I think this is a really fun way to do it, so that you build that muscle automatically because it’s something that really, really motivates you. And, then if, let’s say, you’re successful at this, let’s say you go for a few months, you’re profitable again. You’re making money consistently and you’re able to get close to that trip, or maybe you have to put in a little bit money to actually go on the trip. Okay, that’s fine. But, you did what you were supposed to do trading wise. That is my goal for you. I know your goal is to go on the trip or buy the thing, but my goal is for you is to actually become consistent. Get that experience, build up that habit and have the confidence because if you can go through this exercise and you can focus on your trades, make adjustments, traded properly for three months, six months, nine months at a time, and accomplish your goal, well, then you can do anything.

Then retirement or early retirement or whatnot is not that far away. Buying a new car, buying a new house is not that far away. Paying off your debt is not far away because you’ve already done it. You’ve already had that experience, and then it’s just a matter of numbers, right? Having a goal, picking a timeframe and being committed and being focused and being disciplined, that’s all it is. That’s what trading is. That’s the formula. If you were to ask me, what’s the secret to trading? Well, you got to know why you’re doing it, right? You got to have a proper trading plan, and then you got to stick to it, and that’s it. You got to have some kind of urgency that, yeah, I need to make this happen. And, that is trading in a nutshell. Right?

And so, I mean, I’m really excited. I haven’t thought about what I want to do. That’s gonna be really cool. I don’t know if I’m going to do the same exact thing because I’m not having that many issues as these other two guys that were having problems with adjusting. I do have issues from time to time, so I’m not going to say that I’m perfect, or anybody’s perfect, you will fall off the wagon. But, the stronger your muscle is, the more consistent you will be properly trading, and then the more consistent you will be in your results. And, that is what I want for everybody. Consistent profits, or just even if you’re breaking even.

But, if you go month one, making money, making money, money, money, making money. Oh, breakeven. Oh, I lost a little bit. Couple of percentage points. Okay, no problem. Making money, making money. Over time, all those gains add up. All of that percentage adds up because the game that we’re playing when we’re trading passively, and where we’re selling options, we’re not trying to make half a percent a month. We’re not trying to make 8 percent a year like the stock market. No man, we’re have the capability of doing 10 percent, 12 percent, 15 percent a month. So, you don’t need super, super high returns to do really, really well. You can do three percent a month. And, for some of us that’s like, man, three percent? That’s horrible. No, it’s not. Three percent every month is 36 percent. That’s much better than any mutual fund. That’s much better than most hedge funds. Most professional money managers. So, the odds are already in your favor, the numbers and the math already works out. It’s already in your favor. The only thing that’s holding you back from the success that you want in your trading is you.

And, if discipline is the problem, then I think this exercise is a great way to start building that habit, to start building that muscle. And, I’m really excited for this, and I hope that you would email me, or let me know, send me a message, hit me up on Facebook or whatever, and let me know what is your goal, and when are you going to do it by. So, those are the three things I want to know. I want to know what your goal is. Is it a cruise? Is it a trip? Are you buying something? How much is it going to cost? Okay, how much money you need for that, and by when are you going to do it? If you could send me those three things, I will do my best to hold you accountable. Okay?

So, let’s say you’re telling me that I want to go on a trip. It’s going to cost me $3,000, and it’s going to be six months from now? Well, three months from now, I’m going to try to send you an email and say, hey, three months are up. How are you doing? I’m gonna hold you accountable. Here you go. I’ll do my best. I don’t know how many of these responses we’re going to get, so we might be overwhelmed, but I will try to set it up in my calendar, and have this maybe done automatically. Where if you send me something, we’ll send you an email in a certain amount of time saying, hey, are you on the ball? Are you still doing it? And, that’ll be my of helping you out. But, I would love, even if you don’t want that, I would love to know what you’re gonna do. What is it?

Cruises are my thing, or vacations really, any kind of vacation, going on a trip, that’s my thing. But, if you want to buy something, that would be exciting. So, just let me know. Are you going to do a Montblanc pen. I did that one time. I love pens. So, I bought myself I think a thousand dollar pen from Montblanc, and now they have even more expensive pens. But, that’s the one I liked, that’s the one I got. So, it was really cool. That was something that I cherished because it’s like, I worked hard for this, I bought it and no regrets. I am not going to regret spending money on this because I earned it, and I know that I did it once, man, I could do it again and I can do it again and again and again. And, the numbers just get bigger. It’s the same exact process to accomplish anything you want.

But, we start off on this small, small scale for something that really, really motivates you, really gets you excited. It really gets you juiced because it’s fun. We’re not being serious here. We’re being frivolous. We’re being playful, we’re being like little kids again. So, that’s the thing. Right now for my daughter, we’re trying to potty train her. So, we’re like, hey, do you want ice cream? Yes, I want ice cream. Okay, well then you better do poo poo in the potty. If you do poo poo in the body, you get ice cream. And, that’s her goal. It doesn’t always work every day. We’re trying to get there, right? So, this is your thing, do you want ice cream? Okay, well be disciplined. Focus on your trades and you’ll get whatever it is that you want. So, let me know. Email me, let me know what your big, exciting goal is and I’ll do my best to help. All right, take it easy and, remember, trade with the odds in your favor.

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