Are You A Trading System Hopper?
One of the very first things you will do when you get into binary options trading is search for a system. The idea is of course to find the most profitable system you can, one which gives you a great win percentage and other awesome statistics and generates a boatload of money. If you are doing this, that is great—you are doing exactly what you are supposed to do at this stage.
But if you have moved on to the next stage and you are still doing the same thing, you may be system hopping.
What is “system hopping?” It is an obsessive search for the perfect system. The mental assumption behind it goes like this: “If I can just pick the best trading system, all I have to do is follow it and the profits will roll in and I will be set.”
The problem with this mindset is that it ignores the bigger picture. Yes, a great system is necessary to success, but it is not the sole ingredient in success. Things are always changing in trading, and no system adjust automatically for those changes. The trader must adjust the system manually.
System hopping can take all different kinds of shapes and sizes. For example:
- Do you try one system after another, systematically testing and tossing aside system after system, refusing to trade until you find “the one?”
- Do you use a trading method until it breaks, despair, go back to the drawing board, and try a brand new one every time?
- Do you use a bunch of different trading methods right now, all at once, just to try and keep all your bases covered? Do you think that testing a dozen systems at once will get you to the perfect system faster?
- Are you constantly looking for new indicators to try or new price patterns to test?
- Do you buy one “Guaranteed best ever way to make money while sleeping on the beach” system after another? Do you invest in auto-trader after auto-trader?
When you are doing these things, it can feel very logical—even responsible and dedicated. You reason that you are taking the fastest, most efficient route to finding the best system. In reality, the effects of system hopping are as follows:
You spread yourself too thin. With your energies divided and without the ability to focus on a single system and learn it really well, you are never likely to become an expert at any of the zillion systems you have decided to try. As a result, you will only ever be mediocre at using them. Even if they have the potential to deliver outstanding results, you will fail to achieve those results. Even the best system in the world will fail if it isn’t properly executed by the trader.
You burn through money. Many traders purchase dozens of “Guaranteed cannot fail! 100% success rate! Sip margaritas and kick back on the beach!” systems. They also spend hundreds of dollars a month on endless signals and alerts and trading robots. Oftentimes the only result is that you blow all the money that should have been invested in your trading account.
You toss out the baby with the bathwater. How many good systems have you thrown away? Probably quite a few. Only you will never know it, because you just gave up before you realized what you had. Oftentimes traders engaged on one of these “holy grail” quests have no idea that they actually had what they were looking for all along. They just did not understand that systems require maintenance and adaptation to keep on performing.
You internalize a sense of crippling failure. This may be the very worst side effect of system hopping. The longer you do it, the more desperate you become, because all you have been doing is racking up failure after failure. Soon you will feel that everyone is lying to you, that there is no money to be made trading—or if there is, you are somehow unworthy of it and not cut out to be a trader.
The ultimate result of system hopping is often the worst—a dedicated, hard-working, driven trader who had all the potential to become a pro ends up quitting instead, and never coming back.
If you recognize any of the habits I just discussed as your own, or if you have some similar pattern of behavior, it is time to let it go. Letting go of the search for the perfect holy grail of systems is scary for a couple of reasons. First off, you are admitting to yourself that nothing is perfect or works all of the time. Secondly, you are committing yourself to the hard work of maintaining and adapting a system that works most of the time so that it can continue to serve you under different market conditions.
This hard work is absolutely worth it, though. When you extricate yourself from the system hopping cycle, you will stop internalizing failure after failure, and you will quit throwing your money down an endless drain. You will stop listening to the scammers and cheats who want you to believe that trading is easy—if you will only pay them money—and start listening to the smart, honest, hard-working traders who can guide your journey to success.
Best of all, you will finally get on the right track for that success. With all the time and energy you free up when you quit system hopping, you can finally focus on one reasonably good system you have discovered and make it even better. You can learn essential skills such as adaptation which you have been avoiding, but must learn to become a long-term success. It is a hard leap to make, but you will be glad you did when your life finally starts changing for the better. A year from now, you will look back and wonder, “What took me so long?”