Line Your Own Pockets

Michael: 00:00

Alright, everyone. Welcome back to another episode of align your own pockets. In this episode, we're gonna talk a little bit, you know, kinda outside trading, but a nice psychology tip that me and Dave were talking about in the green room, beforehand about how, you know, sometimes you need to make trading a little bit more real, and there's some things you can do to kinda take some things that we talk about that's very, you know, digital and numbers on a screen and and lines on a chart and and kinda bring that into the physical world to to maybe help a little bit with your, your psychology and and motivation. So why don't you why don't you tell the story, Dave?

Dave: 00:37

Yeah. So, yeah, I coached several traders, and one of the things I like to do is so traders come to me. Some of them, when they come to me, they're not making money. Some of them are, and we get to higher levels. But a lot of them aren't making money.

Dave: 00:55

And very quickly or, you know, shortly after we start working together, they start making money. And, I mean, that's the whole point. And I've gotten really good, I think, at picking those people out. So if I can tell you're not gonna be the kind of person that is gonna make money, I'm I'm not gonna work with you. So I've gotten a lot better at, you know, detecting that.

Dave: 01:20

So I think once you have some success, because I remember when I was in this situation several years ago, I was having success. I was doing it on the side. So I didn't really need the money. So I was just sort of watching my bank account go higher and higher. And that's great.

Dave: 01:43

Obviously, that's great. Yeah. But what I realized is, you know, when you're comfortable, when you're doing it on the side especially, it becomes kind of a video game kind of. Like, when when it's not really real to you, you don't have to have the money. It becomes kind of a game.

Dave: 02:05

And it's that can you can almost be a little bit removed when you wanna be fully engaged. And I've done this with several of my traders where I say, okay. Pick something to buy with your trading profits and to make it real. It's almost like a trophy. And and when I tell people this, they're like, oh, yeah.

Dave: 02:37

Okay. One guy said, yeah. I'll get I'll get a Rolex. That'll be perfect. And, okay, that's fine.

Dave: 02:44

But what I really wanna see is something that you're gonna use every day that really only you know about. A Rolex is something that, you know, it's it's sort of not really for you. It's for doing other people.

Michael: 02:57

Yep.

Dave: 02:58

I really like it to be something that you use every day that only you know the trading profits brought bought you. So, what what do you think so far? I'll I'm gonna give you a couple examples, but I wanna get your thoughts so far.

Michael: 03:12

No. I I like the idea of, again, making it real, and especially for those people who are are doing it part time. Right? Because generally speaking, if you're in the situation in life where you have, both the the time and the wherewithal and saved up capital to to trade part time, then, you know, you're doing you're doing okay. Right?

Michael: 03:34

Your your life's life's kinda fine. And you're right. Sometimes, it gets very video game esque. It gets very numbers on a screen. Line goes up.

Michael: 03:44

That's fine. But people can get a little bit detached, I think, of the actual monetary value. So it seems like what you're doing is is a lot of what would happen, when it came to trading. When I was trading the prop firm, they would talk a lot about, you know, you have to imagine what each dollar means. Right?

Michael: 04:03

So, you know, if you're gonna risk a hundred dollars on the trade, you need to know what that means. Right, this is what a hundred dollars could buy you and try to kinda quantify those things in order to keep yourself engaged. Because at the end of the day, especially if you're doing this with a lot of people doing things like, retirement accounts. I trade a lot in my retirement account. I can't touch that money.

Michael: 04:25

Right? So even if I do great, it's it's something that I can't, you know, pull out right now. So it actually makes sense to do something to say, okay. You did well, and then let's make it some sort of a physical reward. I'll be interested, and I'll ask you down the road.

Michael: 04:39

Do you do you punish them if they do something bad if the trading's not working out? Is it like a cattle prod or take something away from them, or is this just to just to keep the spirits high?

Dave: 04:50

Well, sort of ironically, when things aren't going well, it's pretty easy to stay motivated. Right? Yeah. Especially if you've had success before and then you have a drawdown. Like, that's it's easy to be motivated in that situation.

Dave: 05:05

So

Michael: 05:05

Mhmm.

Dave: 05:07

But this is more for, you know, when things are going well. Like, the only way I can describe it, it it kinda becomes a video game. And, so let me give you a couple examples of what some of my traders came up with to get themselves. So

Michael: 05:23

Sure.

Dave: 05:25

One guy who's been trading a long time, he was a losing trader. We started working together. He's making money almost every month now. In fact, maybe every month. And I could tell he was in the situation where it was becoming sort of a video game.

Dave: 05:45

Like, he wanted he he needed to be it needed to be more real for him. So I I I said, okay. Think of something in this arena or in this area that you wanna get. So he decided to get two, really nice Aeron office chairs for himself, which I think is a perfect thing to do. Right?

Dave: 06:07

I've had an Aeron chair for a long time. I mean, they're great. They, they're not cheap, but, man, they're just heads above other office chairs. And just think about how often your butt's in that chair. Right?

Dave: 06:18

It's a trader. You're you're in there a lot. So I think Well,

Michael: 06:22

and that's actually Thanks. Funny enough, that's actually how the conversation started because I I told Dave that, when I built this office, I kind of I burned the boats. Right? I I I bolted this desk to the wall, and I don't have a chair in here. And then subsequently, I've been complaining about my back, the entire time.

Michael: 06:40

So it's just funny. That's how that's how we got started on this. He said, oh, you know, you should get a chair, and you should you should do it for for this reason. So I just thought I'd I'd share people how this how this got started. And, also, I guess that I'm an old man that if I stand for a couple hours a day, my back starts hurting.

Dave: 06:56

Have you gotten your chair yet?

Michael: 06:58

Not yet. I need to either bolt this thing down a little bit, or I gotta find, like, the world's tallest chair. So it's been a it's been a bit of a struggle, but I've been looking.

Dave: 07:07

Yeah. I have a standing desk and but it goes up and down. And when I stand, I have this really nice mat. It's padded mat

Michael: 07:17

Mhmm.

Dave: 07:17

That I stand on, which is much, much better than the floor. It's got all this, like, contours. There's a little bit of variety in where you can stand. So

Michael: 07:25

Yeah. Yeah.

Dave: 07:26

How I suggest that. I cannot imagine standing all day, Michael. That's that seems crazy to me.

Michael: 07:31

It sounded you know, I do. It sounded like a like a tough guy move at the time. It's like, I won't even have a chair, then I'll be forced to stand. And then, yeah, now a couple months in, it's, it's a lot for sure.

Dave: 07:44

Yeah. I mean, it's worth thinking about. I mean, like I said, just think about how much you're in front of your computer. That's why I always I don't cut a lot of corners when I think about my computer, my monitors, my workspace, just because you're here so often. You really wanna be, you just spend so much, so many hours in there.

Dave: 08:08

So that was, I thought was a great, a perfect thing to get for the, this this trader got. So he finally got those, he sent me a picture with him, sitting at it. So, yeah, super awesome. The other one, I I I really like the one that's, another guy got. So this is the one who said, yeah.

Dave: 08:32

I'll get a Rolex. Well, choose something that, you know, that you're gonna use every day. And I imagine if I had a Rolex, like, I wouldn't use it every day. Right? I would,

Michael: 08:44

Be scared to.

Dave: 08:45

Gonna go for a run with my Rolex on. Right? I'm not gonna go for a bike ride. That would be super weird.

Michael: 08:50

Mhmm.

Dave: 08:52

So I suggest he he needed some suggestions. So the what what I suggested him was an ember mug. You ever heard of these, Bluetooth, coffee mugs?

Michael: 09:03

I haven't, but I'm googling. Because, yeah, you mentioned it. Yeah.

Dave: 09:07

It it's I think it's the perfect thing because it's a it's not a whole bunch of money. It's like a couple hundred bucks or a hundred $50, somewhere in there. Mhmm. But if you you drink coffee, you can be drinking it every day. And this it's like a higher end coffee mug.

Dave: 09:25

Right? And you can you can dial it in to the exact temperature that you wanna drink your coffee at, and it keeps it at that temperature for a long period. So you don't have to, you know, really rush to drink your coffee. You can you can drink it over time. It's got a really good feel in your hands.

Dave: 09:42

It's got a good feel when you drink it. And it's, you know, it charges up. So to keep it that temperature, and it's kinda like I don't use but I don't use the app, but there's an app you can put on your phone to dial in the temperature.

Michael: 09:56

Of course. Of course, there's an app. There's an app for everything. You can't just have a thing now. It has to have an app with it.

Dave: 10:01

Yeah. So it's, it sounds like gosh. That's do you really need a a a mug like that? I mean, you're just drinking coffee, but it's quite nice. It's it's very it's really quite nice, and that's the perfect kind of thing.

Dave: 10:17

You're use it's something you use every day. Every day you drink your coffee, you're reminded, okay. This is what trading got me, and it's I think that's a perfect, kind of thing.

Michael: 10:33

Well no. And I and I I like the idea. I like the concept. I think, you know, a lot of it, what it's what it's getting to is that trading is a grind. Right?

Michael: 10:42

It it's a grind of a a game. Right? The whole, marathon, not a sprint comes through kinda all the time. It it is, right, something that you're gonna be doing, and we talked about this a little in the last episode too about journaling, a a lot of delayed gratification in things as well. Right?

Michael: 10:58

You're gonna be doing the right things, hopefully, you know, when it comes to what you're risking and and the process you're building and what you're doing. And then you may not see life changing results right away. That might take a little bit of time, but, you know, you're doing something kind of physical to kinda remind yourself the importance of the grind. You're saying this is something that I was able to get because I did this kinda over and over again. The the thing that kinda came to my mind while you were talking was a lot of people do, and and I did myself too as a bit of a a gym rat, is that you end up buying equipment and accessories and everything to go to the gym as a bit of a motivation of, okay.

Michael: 11:41

I've I've been going. Right? Things have been going well. You know, now I I can I I see that there's some benefit to doing this? Right?

Michael: 11:49

The first day you go to the gym, you don't need wrist wraps. So you can lift more weights with your back, and you don't need some of these things. But as time goes on and as you start to get a little bit developed, you can start to say, okay. Well, right, my grip's giving out, so let me, you know, get this and get this thing to to help kinda push you forward. And, yeah, it's almost like a a congratulations to yourself that you've gotten, right, one level higher, and and now you get to have a thing and and see a thing and and make sure that that's kind of a little bit nice and a little bit motivating to to kinda hopefully push you push you a little bit further down that road.

Dave: 12:24

Yeah. So it reminds me of so my wife and I coached cross country at the local high school here for ten years. We had a lot of success. She was in the main driver. I was sort of the assistant and became became sort of co coaches.

Dave: 12:44

So I spent a long time working with beginners in this thing that I love doing, running.

Michael: 12:51

Mhmm.

Dave: 12:52

And, you know, running has given me just so much over the years, so I was I was really happy to give back. And it was really eye opening seeing young people do this activity, become runners, become, you know, physically fit, and accomplish big things. You know, we won several state championships. We had several individual state champions. So it was really just a fun thing to be involved in.

Dave: 13:25

And so, obviously, with each cross country season, the the end goal for us was a team state championship, and you get this big trophy. Everybody knows who wins the championship. Mhmm. But throughout the year, there were smaller meets and, you know, somewhat smaller invitationals that, sort of fly under the radar, but you have to do them to prepare yourself for the state championship. And one of them is, at a park called Hagenstone in Greensboro, town close close to where we live here.

Dave: 14:03

And in fact, this race has been going on forever. In fact, I did this race in high school. It was one of my favorite races. Really nice course. But at the end, they give these, trophies to the kids, and they've got a ton of trophies.

Dave: 14:17

And for this particular race, the trophies are these little carved owls. Okay. So it's it's like wooden owls. And, you know, they give many of these, like, probably 30 per race. So a lot of people are getting these trophies.

Dave: 14:39

So, you know, there's this ceremony. They call all the kid the kids up there one at a time as, you know, the first thirty finishers in the race and give them each one of these little, wooden owls. Really cool looking things. So there is this public moment of, hey. Bob got this you know, did well in the race.

Dave: 14:59

He got a trophy. But I really like that these particular ones that in that they you know, they're not those gold trophies that you see, you know, back in you know, for for most events that you give these sort of gaudy looking trophies. It was this really cool wooden owl. So it was a much bigger deal because it wasn't like all these other trophies. And Yeah.

Dave: 15:27

The other thing I like about it is you yeah. There was some public recognition, but that's not why you're doing it. You're doing this activity because you wanna be good at it. You're not doing it because other people are gonna notice you're good at it. You have to be doing it from within yourself.

Dave: 15:46

You have to have be self motivated to do it. Otherwise, you're not gonna be as good as you could be.

Michael: 15:52

Mhmm. Well, the what's cool thing, right, is it's they're more memorable, right, when it's and I think that's kinda what you're what you're going for there, where what you're getting your clients to get is the same as these kinda owls, where they're just different enough that you'll look at it and you'll say, okay. I got that for for this specific thing. And yeah. And part of the reason that I think that this kind of thing is so important in finding these kind of motivational tools to keep you going is part of just the probabilistic nature of of trading, right, where you're going to, at some point, have periods of drawdown and and periods where, that it gets real easy to to get in there and work.

Michael: 16:33

But there's moments, especially when you're systematic and and when things are kind of simple and automated, that it it feels like, okay. I figured it out. I can just slack off a little bit and, you know, I've I've got this thing and it's working and it's making money, and I can just, you know, take off and let let a system handle something for me. So to do that thing of and I think over time, I think what motivates a lot of traders is having been there and then slacked off and then having whatever you do stop working, and then you end up kind of back at square one. So I think what this is meant to do and and the idea behind it is just to keep you going when things are are, quote, unquote, easy so that you can you can continue to push into, okay, this is the next thing and the next thing.

Michael: 17:19

And and, you know, the the times where you feel like you should just be kicking your feet up and and taking a break, giving you something to say, well, you know, if I want another mug or another whatever or just something staring in my face to say, you know, you got this by doing the work and and, you know, get back to work kinda thing.

Dave: 17:37

Yeah. Yeah. I think, I think it's especially true for people, you know, who aren't doing this full time. It's if you're doing it full time not hard to stay motivated. I mean, that's it's that's probably pretty clear to the listeners.

Dave: 17:54

I've done it both ways. And, yeah, it's the part where this was most effective is back when I was doing it on the side. Mhmm. So and, you know, it starts out as a mug, but it can grow into and it did for me. It grew like a we redid our house.

Dave: 18:14

We moved houses. I put my kids to college. Mhmm. So, those became you know, grading is very meaningful and, you know, could provide a lot of things for you.

Michael: 18:31

Yeah. But like you mentioned, you don't you don't start there. Right? You know, you start at a bug, and you start at a small victory. It's one of those things too that I remember, going through a trading slump when I was trading the prop firm and, you know, just purely discretionary at the time.

Michael: 18:47

And kind of the advice that I was given by some of the senior traders there is, right, you gotta get back to small victories Right? Get back to little things and and and just have a victory and be able to hang your hat on that and say, okay. I I did the thing. Right? I I I made a a dollar.

Michael: 19:06

Right? I I made a trade, and that was a good trade, and then stop there and then go from there. And it's kind of the same thing thing. I think you're thinking with these where you're you're starting with small little little things to keep you motivated and saying, okay. Yes.

Michael: 19:18

This is possible. You've done it. You have this physical thing to prove that to yourself, you know, when things are a little hard or or like, we talked about when things are a little easy, and then you that thing grows kinda over time from there.

Dave: 19:33

Yeah. And, you know, it doesn't need to be a Ferrari even if you can afford it. Right? That's why I I use the example of a mug. I mean, it it sort of reminds me one more one more running analogy here.

Dave: 19:44

Sure. So it reminds me back in high school, there were some there were two guys that I ran against, sort of the rival high school. They're a little bit older than me. I was friends with them. I went over to their house, and down in their basement, they had all their running trophies in this display case, like, hundreds of these things.

Dave: 20:09

And I'm thinking, why in the world would you keep all those trophies there like this? I mean, that that can't be for you. It's for other people coming over. It's almost like having a Ferrari. Like, the Ferrari like, it's for other people to see, like, what you do.

Dave: 20:26

It's it's it's for other people. It's not for you. So I thought it's it's it's it's kinda the same thing, like a big trophy case. Gosh. That's seems kinda silly to me.

Dave: 20:38

What do you think?

Michael: 20:39

Yeah. I like the idea of what you're talking about where it's, it it's for for the the person we'll just see. Anyone else will see a mug. Right? They'll look at it.

Michael: 20:49

They'll see a mug, and they'll look, okay. The guy's got a mug. Good for him. But, yeah, for him, it's just a little bit more sentimental. Kind of, I guess, the you know, going back to those the owls.

Michael: 20:58

Right? If it's just a if it's just an owl, that's all it says, well, right, just an owl. Doesn't really mean too much. So, but to the person, that could be that could be a much bigger deal.

Dave: 21:08

Yeah. It's not, yeah, it's not just sentimental. It's, like, truly meaningful. And I I I think that's really I just it it just had a big impact on me, and it has an and I can tell it has an big impact on the traders I work with who are in this situation. So That's good.

Dave: 21:27

A lot of it helpful for our listeners.

Michael: 21:29

Well yeah. So right? You know, look around your house. If you're an old man like me and you need a new chair because your back hurts all the time, take a look at it and say, hey. Maybe maybe if I've got some trading profits this month or this week or something, I'll I'll pull them out and and do that.

Michael: 21:44

And, you know, the last example I'll give is I I read a book. I forget what it was called. Spy guy Tony Oz or something. And, basically, he was going in. He was like, I'm gonna start trading, and and these are the rules that I'm gonna trade with.

Michael: 21:57

And it was way it was a book written in, like, the early nineties. Well, it would have been the the February because the moment he started was the tech bubble collapse. And he's like, well, I made these rules, and I'm only allowed to buy stocks and all this stuff. And he he published every trade in this book. But what he would do at the end of every week, he would get the, the trading account to mail him a physical check for what he was making.

Michael: 22:24

And it was kind of the same every week regardless whether he made a lot or or didn't, but he would just get a physical check-in the mail and the same kind of thing. He's like, yeah. I could get this even back then. Right? I could get this wired to me or something like that.

Michael: 22:37

But I want to get the check, and then I wanna walk down to the bank, and I wanna deposit the check as as, like, a physical right? This thing has been done. And and, yeah, for someone, you know, for us, especially who we're doing, everything we do is just hitting buttons at the end of the day. Bringing it to the physical world is definitely something that makes makes a lot of

Dave: 22:55

sense. Yeah. I like that. It's it reminds me of the episode we did on what not to automate, which, it's sort of like that. You could have it automatically go to your bank account, but he liked getting the check and walking down walking down with the bank and depositing.

Dave: 23:09

I think that's really cool.

Michael: 23:11

I'll see if I can remember the book and and and, link it in the description or the show notes because it was a really, really good book. I don't even know if it's sold anymore, but, yeah, it was just real it was just this guy's basically trading journal. Every day, these are the trades I made. These are why why I made them, that kind of thing. You know, discretionary trading at that time.

Michael: 23:30

But, yeah, something really, really interesting. So, again, I think, as always, we've left the left the people with something to think about. Right? Is there is there something in your life that you can you can do to kinda tie what you're doing into into the more physical world? Then you can certainly go ahead and take a look to do that.

Dave: 23:49

Yeah. And if anybody out there has done this or, you know, got something for this exact purpose, send me an email. I'd like to I'd like to hear what you got and, you know, how meaningful it was for you. So send me an email. I'd like to hear it.

Michael: 24:06

Oh, yeah. That'll be that'll be cool to share. Share them if when you get them, Dave. But, yeah, I think that was another good one. And as always, I'm Michael Noss.

Dave: 24:15

And I'm Dave May. We'll talk to you next week online in your own pockets.