Before I go into the details of the topic, I feel important to just shed some light on very popular debate between science and art.
Science is more regimented with theories, rules, predefined procedures, and policies to follow. So we can say that science is same for everyone. Anyone studying the science got to know the same theories, rules and calculation methodologies. Whereas art is about skills, its an individual perception towards using all the tools he/she has. When two artists draws a painting on canvas, they use same tools but output is different per the skills of using those tools. A batsman in cricket used to know all the techniques of bating but mastering those techniques to perfection becomes the art.
Science of Trading:
Similarly Trading itself is a science, where we need to know the science of charts, chart patterns, chart signals, you need to learn about how to study the fundamentals of individual stocks. You need to learn how to read market breath. How to read market data every day from around the world. You need to know how and from where you will follow the news about markets and news about individual stocks. How to read market sentiment. All these things are science of trading which is common for everyone, no one on earth learns different science of trading.
Art of Trading:
But then comes the art of trading, which is, how you remember the rules and every science you have learned about trading and not only remembering but how you apply them in your trading strategy. Then over the months and years you practice all those science rules and science theories, then you repeat your actions till you master them. So you become the trader.
"System and Rules are in place and you have to combine them with risk management"
Trading science is common for all, which can be applied to any market in world. Its not like that you have to learn different science for every single market in world. But you need to master the art of trading science for every market individually.
"You need to decide what kind of trader you want to be. Everyone will claim their way is the best way but you have to decide what fits you"
If trading was purely a science, you wouldn't need traders. Everything could be done through program trading. However, to be successful, to have that edge, not only you do need the science of trading, but you also need to develop the mental edge and the art of trading.
The art of trading is the reason that one person can make money with a given system and another person cannot. It is about understanding your system and tweaking it to suit your purpose and your personality.
You need to develop the skills and then the skills become your habit. In the process, you develop a feel for the markets and trading becomes an art.
You cannot develop your feel for the markets by reading books or studying alone. You need to be in the game and understand the market behavior. You need to listen to the market and learn from it, rather than impose your views on it. Remember you always follow market but market does not follow you.
I find it very relevant here to quote saying of Thomas Edison, "I have not failed, I have just found 10,000 ways that won't work"
When you develop your feel and intuition for the markets, you build your confidence. By doing that, you trust yourself more and you do not feel the urge to follow others. You talk to them and seek their advice, and you are comfortable with your own conclusion even if it goes against the norm.
Remember, your success is not about what is happening in the markets. It's about the choices that you make and how comfortable you are with your choices.
Norman Vincent Peale said, "Any fact facing us is not as important as our attitude toward it, for that determines our success or failure."
I am sharing a very interesting conversation with a trader concluding to a point that trading is a science but successful trading is an art.
Q1: Do you believe trading is an art or a science?
Trader: Definitely a science.
Q2: How do you trade?
Trader: I use an automated system so there will be no emotions attached.
Q3: How did you come up with that system?
Trader: I have done my homework. I really know my markets. In addition, I learned the system inside out and understood its assumptions. I constantly test it and push it to its limits.
Q4: So, you are not relying on the system formulas alone. Are you?
Trader: No. I come up with my own angles and formulas.
Q5: Your own formulas give you the edge.
Trader: Yes.
Q6: How do you come up with your own formulas?
Trader: It is based on my knowledge, experience and ideas.
Q7: How do you define it? Do you consider it your feel and intuition for the markets?
Trader: Yes. It is something inside of me. It is a gut feeling that I have.
Q8: So, that is when the art comes into play? Doesn't it?
Trader: Yes.
Thanks for Reading.
