It just occurred to me that trading and scuba
diving have a lot in common. I was thinking
about how traders must follow their plan while
in the midst of a trade and realized that’s
what I do when diving, especially
deep diving which is my favorite sport.
When I’m on a dive boat, planning to get in the
water, I gather as much information as I can
about the ocean beneath me. I refer to marine
charts, dive guides and anyone in my group who’s
been to this area before.
Then I make a dive plan, before I jump in the water.
When I’m trading, I gather information, use my
charts and consult my system rules then make a
trading plan; before I put the trade on.
When I’m at depth, I have to make adjustments for
the conditions – which way the current is running,
how much visibility we’ve got, if there are any other
divers in the water, how my ears feel, what my dive
buddy is doing, the creatures we’re sharing the water
with and the topography I find.
I consult my instruments, review my plan and then
relax and have some fun!
When I’m in a trade, I monitor the situation, looking
to see what’s as I expected and what’s different. Is
market trend continuing or has it reversed? I take
a look at my plan and follow my system’s signals (which
is also a lot of fun for me).
When you’re a couple hundred feet under the ocean,
you’ve got to trust your gauges. You know, based on
your training, that the pressure impedes your decision
making ability so you train yourself to follow your dive
plan even while you respond to unexpected events.
Trading’s the same; you’ve got to trust your system and
the signals it gives you. You recognize the emotions of
fear and greed will cloud your judgment and so you must
follow your map while assessing the territory and how
it looks compared to what your advance planning prepared
One of the things I like most about deep diving is the
encounters with big fish,
rays and whales. These guys
weigh hundreds, even thousands of pounds and can kill
you with a flip of their tail. Make the wrong move and
you’re dead meat. Not because they’re out to get you but
because you didn’t have enough respect for the big fish.
Individuals trading their own accounts are never going to
be the big fish in the markets. Consequently, we watch
and emulate certain behaviors the hedge fund guys and
Mutual Fund managers do and guard ourselves from any
sudden moves they make (and yes, sometimes they are out
to “get” you or at least your stops).
The other cool thing is this is often blue water diving
meaning there’s no reef or ocean bottom to see. It’s easy
to get disoriented and if you don’t check and believe your
instruments and dive the plan, you can make the wrong
decision under pressure and kill yourself.
Trading isn’t usually a life-or-death situation but you
do venture into unique situations where you’ve got to
have confidence in your system and signals. Making a wrong
decision under pressure in the markets can cost you your
At the end of the dive, when I climb back on board the boat,
I’m tired but excited. It’s a great time to recount the
adventure, jotting down key elements in my dive log so when
I encounter the same type of dive or return to this spot,
I’ll be even better prepared.
For those same reasons, I like to keep a trading journal.
Keeping a log of what happened, what I did and why helps me
constantly improve my trading and document my growth.
So, if you’re interested in deep diving I suggest you seek
some professional training and realize you’ll need to set
aside some significant amount of time for learning and
building your experience– don’t expect to start off diving
Hammerheads off the Galapagos on your first dive
trip. But when you do get there, you’ll know you’ve gone
where few have gone before and you’re entitled to feel the
thrill of deep diving with the big fish.
We can say the same about our trading. Find a program you
can have faith in, follow your instructor’s guidance and
build your experience. Give yourself time to grow and stay
in the game long enough to experience the thrill of a big
Helping you retire on time,
Trading and Scuba Diving Have a Lot in Common