Focus

There was an excellent post by Mojo over at Insane Money, which I thought bears some reflection. The crux of the article is that focus makes a difference. It's probably not a surprise to anyone that specializing tends to cause one to get really good at what they are doing, while generalizing broadens our horizons. Both are interesting and have benefits, but specialization (aka focus) tends to help us excel in one specific area.

Mojo points out that his own trading improved dramatically when he was able to concentrate on fewer strategies. I've concluded the same thing. I mentioned a long time ago that I focus on three types of trades:

• Condors
• Calendars
• Directional Spreads
  

It's been several months since that article, but things haven't changed much. Yes, I have some long term equity holdings, but I don't trade them. My trading is limited to the things I have learned well. I think there is a place for experimentation and learning. I also believe, however, that once you figure out what works well you will be far better off to focus on what you do well. That's not to say that a person can't master many strategies... it will just take some time to do that... maybe a lot of time. Meanwhile focus on what works and you'll be far more satisfied with the results.

Good Trading...