Failure Won’t Ruin You… but Not Doing This Will…

Stock Market Analyze

Failure hurts…

You have an idea. You plan. You strategise. Then you execute.

But you don’t always win.

There’ll be times when things don’t work out. It doesn’t matter how strong your desire, or how hard you try. Sometimes, success just isn’t yours for the taking.

This happens to all of us — and in many different ways. It could be in business, sport, relationships…the list goes on. Failure is one of life’s realities.

I recently felt the sting of defeat. No, it wasn’t a trade gone wrong — these rarely trouble me nowadays. This loss was more personal. It took place on the sporting field.

One of my favourite pastimes is running. I’ve been lacing up the joggers for years. It keeps me fit and active. I also enjoy the challenges that racing brings.

12 months ago, I set myself a big goal. I wanted to win a medal at the National Masters Athletics Championships. And not just any medal — my eyes were firmly set on the gold.

Masters is a social event. It attracts a community of runners from around the country. But it’s also highly competitive. Some of the performances are simply amazing.

This year’s meet was in Adelaide. I was there to race the 1,500 metres — three and three quarter laps around the athletics track.

I’ve been racing since I was a schoolboy. But I still get nervous before a big race. It feels a bit like opening your school grades. You’re about to get a judgement on many months’ worth of work.

On your marks, get set, go!

Let me give you a brief description of the race.

The first 100 metres is a scamper. It’s a blur of elbows and feet. The race then settles into a tactical battle to outlast each other. Split second decisions can make or break your season.

This is what a Masters middle distance race looks like…

Source: Quant Trader
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That’s me in front. It’s hardly a clash of athletic greats like Herb Elliott, Sebastian Coe, and John Landy. But we’re still moving along at a decent clip.

The picture shows a breakaway group of six. We had about 550 metres to go. This is the hardest lap of the race. It’s a long way from the start…but too far from home to sprint.

I remember seeing the photographer. I was giving myself a mental pep talk at the time. Mostly lies about how good I was feeling. I was trying to trick my body into pushing harder.

I held the lead for another 200 metres. Then, with 350 metres to go, a runner passed me. I should have quickened my step, but I hesitated. I didn’t want to begin my final surge just yet.

In an instant, three more runners were in front of me. My hesitation had cost me valuable seconds. I was now chasing at precisely the wrong time. I told myself I could still do it.

But it was a bridge too far. I finished fifth — just 3.5 seconds behind the winner. I could almost touch the Bronze medal. It was only 1.2 seconds ahead. How close I’d come.

My secondary goal was still in play. I wanted to complete the distance in less than four minutes and 30 seconds. That’s something I hadn’t done since I was a teenager.

There was nothing in it. I saw the clock tick over as I hit the line. I was painfully short. My finishing time was four minutes and 31 seconds. I’d missed the mark by a heartbeat.

My 12-month plan was now at an end. I was full of disappointment.

A coach came up to me a little after the race. I’ve known him for years, and value his opinion. He said ‘Jason, we all get more practice at losing than winning. So it’s important we learn to bounce back.

And he’s right.

I often tell myself that setbacks are temporary — be it running, or anything else. What matters most is your next move. It’s the people who keep going that eventually break through.

Success, 30 years in the making

Members send me some terrific emails each week. Some ask questions about the service or trading in general. Others tell me their stories of finally making money after years of struggle.

I value both types of email. But it’s the stories about finding success — often after many failures — that inspire me. These remind me what’s possible when we really want something.

Let me give you a short example.

A member called Warwick emailed me a few months back. He’s been trading for 30 years without success. Warwick said his losses this decade are around $2 million.

Now, that’s a lot of negative feedback — Warwick certainly knows how to lose. But he also knows how to bounce back. This gave success a chance to catch him.

Warwick has been with Quant Trader since day one. And he generously credits the service as helping him transform his trading.

At the time of his email, Warwick had a $600,000 portfolio with 161 positions. He now takes many small trades — not a few big ones. He’s also cutting losses early, and giving winners room to run.

And the best bit…a healthy profit.

Warwick reported a gain (including open trades) of $69,000. As Frank Sinatra once said: ‘There’s something to be said for keeping at a thing, isn’t there?

Share trading can be hard. I know — I’ve had many soul-searching moments. There have been times when nothing went right…times when I’d question if I was going to make it.

But, like Warwick, I found that sticking at it can work wonders. It also helped that I found trend following early in my career. Having a solid strategic framework made a huge difference.

None of us enjoy failing. Missing your expectations can be demoralising.

But do you know what? It’s okay. Failing is a by-product of having a go. And it’s these people — the ones who chase big goals — that eventually win.

Until next week,

Jason McIntosh,
For The Daily Reckoning

Editor’s note: Are you falling short of your goals? Do you find it a struggle to consistently make good profits? Don’t worry, you’re not alone. The stock market can be a tough place to navigate on your own.

Here’s something you should do — check out Jason McIntosh’s Quant Trader advisory service. It’s a fully algorithmic trading system for ASX stocks. Quant Trader scans practically every company. It then tells you when to buy and sell. I can just about guarantee you’ve never heard of some of the stocks it identifies.

Try it. See if it makes sense to you. It could change the way you trade forever.

Jason McIntosh

Jason McIntosh

Jason is a professional quantitative analyst. Before he graduated in 1991 he joined Bankers Trust — a Wall Street investment bank — to be a trader. After Bankers Trust was taken over in 1999, Jason, already financially independent, co-founded a stock market advisory and funds management business called Fat Prophets. At 37 he sold his part of that business and retired. These days, he’s a private trader and system developer. In 2014 he launched the wildly successful trading service: Quant Trader.

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