One currency pair? Five currency pairs?
One stock? A dozen stocks?
How many financial instruments can your trading mind hold?
How many markets can your mind participate in?
These are the questions we will explore in today’s lesson.
Let’s begin first with an example from the Chess Grandmaster – Magnus Carlsen
Plays 10 Chess Games At The Same Time, Without Looking At The Board!
Magnus Carlsen became one of the world’s youngest Chess grandmasters around the age of 13.
What is very telling and extraordinary, is how in his 60 minutes interview, it shows him playing chess against not one or two or three, but TEN other people at the same time. These chess Grandmasters can do that. They are that good. They can play chess against multiple amateurs at the same time and beat them. The amateurs can only handle one chess game at a time. But Magnus can handle ten of them.
Here is the amazing thing though: He is not even looking at the chess board. He is facing away from the chess boards. So he has to play ten simultaneous chess games, without even physically looking at the chess board. This requires an extraordinary amount of mind power, compartmentalization and scenario analysis abilities. The positions of 320 pieces, spread among ten chess boards have to be tracked in his mind. And all the possible moves for both him and his opponent.
This has very direct application to trading as well.
When I decided to learn macro in forex trading – I did it for all the major currencies of the world – the EUR, GBP, USD, JPY, CAD, etc. I didn’t just analyze one currency and get good at that. I made what seemed to be a bold move at that time, and went to keep track of all those currencies and their economies. I did not initially know how I was going to handle that surge of information flow. I did not have all the strategies from the Mastery Course I have now to more effortlessly manage the information flow and keep track of things.
But as Magnus Carlsen said of his childhood proficiency:
“I didn’t particularly know if I was good at it or not; I just tried to do it.”
Same with me years ago when I first started. I didn’t know if I could do it. I didn’t know if I could handle all that macro information in my mind. What I could do was try. And I could learn what information was important and what was not. And I did get better every week and month and did figure it out in the end.
With trading forex for example, I can plug in the information flow, the order flow, etc, to all the currency pairs I track.
I can plug in the information to the futures markets that I follow such as S&P, Bonds, Gold, etc.
I can plug in the information to the dozens of stocks I follow, etc.
I don’t limit myself to just following one currency pair or one futures contract, or a few stocks. My trading mind is capable of following much more than that. It is capable of virtually instantly playing out scenarios across a wide range of financial instruments. The “Battle of Scenarios” as I teach in the Mastery Course can be played out across multiple markets.
I did not start off being able to do this. I had to work at it. In the beginning it seemed like my brain would fry itself. It was tough. But it was not impossible. It became very possible.
New connections in my brain/mind had to be developed. My trading brain/mind had to mature much more to get rid of the destructive ego and empower the healthy ego. A constant striving for more robust principles and philosophy to apply had to be done. A constant striving for knowing virtually instantaneously which trading information was truthful, powerful and relevant and which was not, had to be developed. And it was a great joy seeing my trading mind develop month after month.
Therefore, be very careful when attempting to limit yourself to only trading one currency pair, only one stock, only one financial instrument. Even though it might seem like a stretch to follow multiple markets, it is very worth it. Your brain CAN handle it. If you learn how to better manage the information flow, etc, you can most certainly handle it – and actually find it an enjoyable thing to do.
One man was interviewing the hedge fund legend George Soros decades ago, and he seemed to notice that Soros’s mind was going from scenario to scenario. It was jumping from situation to situation. From scenario to scenario. That is what the interviewer noticed in Soros. And he was right on the mark. Soros’s ability to take in so much information and create market profits out of it has been key to his multi billion dollar fortune.
Drawing Examples From History
Carlsen also says that during a chess game, his mind is concentrating not only on the game he is currently playing, but also other games played by other chess Grandmasters at other times in history “that he might want to draw on.”
10,000 of these games in his memory.
I do a similar thing when I interpret the macro conditions, the information flow conditions in the current moment and compare them to some point in the past history. I have an active trading career over the past decade, but I can also draw upon hundreds of historical trade examples that I have committed to memory from the past 40 years, even the past 100 years. I have gone back and researched some of them. In some cases I have even recorded them into various files I have and they are labeled by the year. So I can go back to say, 1992, and see which were some of the greatest trades that year, one of them being Soros breaking the Bank of England, etc, and I can see if any of those examples are applicable to the current market moment.
To sum it up, Carlsen described the satisfying feeling “when you are playing brilliantly.” That feeling is “pretty up there” he says.
Sounds very similar to what George Soros responded when he made over $500 million for his hedge fund in 1985: “Heady stuff” he said. It’s a pretty good feeling – even an intoxicating feeling.
You too can give your trading mind the ability to hold more information and produce more profits, and give yourself that satisfying feeling – all with the Mastery Course.