Whenever I think about the word persevere or perseverance I think of the movie Josey Wales, when the old chief says “endeavor to persevere”. Well, my friends, he was right. Perseverance is a traders virtue that we should all endeavor to achieve. This is not to be confused with patience as a traders virtue, which is something totally different. Patience is waiting for good signals, using money management, taking the time to learn better methods and patience to put in the time it takes to be a winner. Perseverance is getting back up in the face of defeat, losing your ass and then coming back to the market, making a bad trade and then doubling your efforts to do it right the next time, over and over again until you make it, because this is what you will have to do to be a winner. No one steps into the market and starts making money right off the bat; technical analysis is how you win trades, it’s the psychology of trading that makes you money.
Patience Is A Virtue, Perseverance Is Its Bad Ass Older Brother
Before we move on, let’s take a look at the textbook definition of the two words. Patience, being patient, is a quality of being in which you are able to wait that might entail persevering for an extended period of time. Perseverance is the ability to be patient for a long, long time. On the one hand, we have the act, and on the other is the quality of the act.
Patience – The quality of being patient, as the bearing of provocation, annoyance, misfortune, or pain, without complaint, loss of temper, irritation, or the like. An ability or willingness to suppress restlessness or annoyance when confronted with delay. Quiet, steady perseverance; even-tempered care; diligence.
Perseverance – steady persistence in a course of action, a purpose, a state, etc.,especially in spite of difficulties, obstacles, or discouragement.
Patience Versus Perseverance
The difference I know may be a little hard to comprehend, the two words are so similar. Whereas patience is a single event perseverance is the depth of that patience. It’s easy to be patient once. You do something, it doesn’t work out the way you wanted so you try again without frustration until you succeed. The question is, how deep is that patience? How long can you persevere in the face of defeat? What happens when your patience is tested, and tested, and tested again? Do you run out and give in to emotion or do you persevere in the face of adversity?
You may think to yourself, “I’m patient, I can wait for good signals, sticking to money management is no problem”, and you may be right. When it comes to us as individual traders it’s not so much as if you can be patient, it’s a matter of how patient you can be and how you will react when your patience is tested. I know, for myself, that I can be pretty patient and persevere through a lot of difficulties, obstacles, and discouragement but I also know that I can reach a point, sometimes before I even realize it, where my patience snaps. When this happens while I’m trading I lose money.
Losses may begin to pile up through no fault of my own, it may be a bad day for trading or I may have made a wrong assumption in my analysis, and those things happen. If the losses reach a “bad” level I get frustrated, “why isn’t this working I am not a dumbass!”, and instead of taking a step back to get an objective perspective I dive right back in, forget about my trading rules and start making bad trades on top of the good ones that were already not working.
Another perspective on perseverance, from my own life experiences, is that it may take you a long time to become a successful trader. Trading is not easy, profits do not come overnight, and if they do it is possible they will disappear twice as fast. It took me 10 years to reach a point in which I could say I was able to be consistently profitable, and a little longer until I was actually able to make it happen. Along the way I lost a lot of money, a plethora of dollars, a bevy of bills large enough that if I’d just waited I could have 1) saved myself a lot of headaches and 2) guaranteed early retirement. The point is that I persevered when I had some money to put on the market I did. When I lost it I sat back, kept on learning to trade, and waited for the next opportunity because I knew it was possible to be successful, I just hadn’t learned how to do it, yet.
The Bottom Line
Patience versus perseverance, which one is better, is one better and does it matter? I think it does matter and is something traders need to take to heart. You have to be patient with trading because you can’t just jump in and start taking whatever signal comes along. At the same time, you have to be patient with your strategy and your money management because those are obstacles you put in your own way, to help protect you from risk. Once you’ve learned to be patient you have to remain patient, indefinitely, persevering through all the difficulties and discouragement you are going to face on the road to success. Patience helps you make good trades, perseverance keeps you in the market until your patience pays off.