Spending Time

Written and contributed by Cynthia Sarver, Successful Options Trader of the Month – February 2016

“Doest thou love life? Then do not squander time. Time is the stuff life is made of.”   –   Benjamin Franklin

I have always loved reading.  There’s something about curling up with a good book and a hot cup of tea that satisfies my soul.  Yet when I mention a book I’ve read recently, I’m always a little surprised at the number of people who tell me that they “don’t have time” to read.

They don’t have time.  Now the funny thing about time is that it’s the one area in which we’re all equal.  We all have exactly the same amount of time.  I have the same twenty-four hours in a day that the person who “doesn’t have time” to read has.   So why don’t they read more, even when they say it’s something they would like to do?

Because books don’t ring.

Books just sit there passively, quietly, patiently waiting for you to pick them up.  Your phone, on the other hand, is an aggressive little beast, constantly clamoring for your attention.  Even when you’re in the middle of something actually important, your phone can interrupt you…and you WILL stop what you’re doing and answer it, won’t you?

Don’t lie to Auntie Cindy.  You know you will.

So how do you handle all of life’s interruptions while still focusing on what you’d really like to do – which, in the context of this blog, is to become a successful trader?  You learn to manage your time.

Time management is something that people have written books about, given seminars on and created entire courses about.  There’s no way to cover all of it in a single blog.  I can summarize, though.  You ready?  Here it is:

Differentiate between what is important and what is urgent. 

Trust me, they’re rarely the same.

How does this apply to trading?  A quick informal poll asking people how they spent the majority of their trading time came up with the following answers:

• Watching market movement charts
• Attending webinars or videos
• Skype, e-mail or chatting with members of their trading group
• Watching CNBC
• Non-trading stuff, i.e., Facebook, Twitter, games, etc.
• Eating, drinking and attending to bodily functions
• Looking for new trades to put on
• Looking for old trades to take off or adjust
• Adjusting their chair / monitor(s) / trading nest
• Calculating their P&L
• Learning a new trade
• Worrying about the market going up and coming up with 5 things to do by EOD if it does
• Worrying about the market going down and coming up with 5 things to do by EOD if it does
• Trimming fingernails
• Catching up on Netflix
• Back-testing
• Actually executing trades
• Learning more about their go-to trade
• Documenting what they did

How do these items rate in the whole “important versus urgent” world?

Let’s take market watching.  Your charts sit there up on your multiple screens, merrily displaying all of these ticks and candlesticks, volume charts and other indicators.  *PING*  *BLINKY-BLINKY*  There’s STUFF going on!  It’s urgent that you watch it!  Depending on what you’re trading, though, it may not be important.  My M3 doesn’t require mid-day adjustments, so watching the market constantly, although entertaining at times, isn’t important.

News – oh, it’s urgent!  News crawls, banners, talking heads… so many, many shiny and exciting things going on so you HAVE to watch them!  Does it really affect your trading, though?

Communities – I love ‘em and they absolutely have their place.  But do you find yourself chatting a good percentage of the time simply to DO something while you’re watching the news and the market?

What about actual TRADING – you know, the nitty gritty of the whole thing?  It’s certainly important for me to execute trades according to my plan.  In fact, I think this is the most important thing that I do.  But with the M3, many days don’t require me to do anything.  As a result, proportionally, the vast majority of my trading time can be spent IMPROVING my trading, while only a relatively small portion is allocated to actually trading.

So how do I spend – not squander – my remaining time?

It’s a matter of identifying, prioritizing and executing the top items that can help me.  Relevant (that’s the key!) webinars, specific trading groups or communities, back-testing, journaling my trade, these are all things that are important and help me improve.  And yes, if my trading area is cluttered or my chair is squeaky, puttering with that is important, as well.

But the bottom line is that all too often time is wasted during the trading day on make-work that’s irrelevant to goals.

How do you know if you’re doing the right things?   Write down activities you do that you think are important.  Truly important.  Now estimate how much time you think you spend on the Truly Important versus the total amount of time you spend on All Things Trading.

Done?  OK, hide your estimates somewhere you won’t look for a week and don’t peek!

Here’s your challenge: For one week, write down everything you do and how long it takes.  No cheating; do what you normally do every week.  The toughest part will be having the discipline to write down everything but, hey, we’re traders – we ooze discipline!

Attorneys track their time (here’s a standard timesheet from The Commonwealth of Virginia) so why shouldn’t you?  Your spreadsheet program probably already has an automatic timesheet template you can use as a basis (feel free to spend a little time tuning it) but here’s a quick and dirty version:

Day	Task	Start Time	End Time	Total Time

At the end of the week:

1. If the tasks are pretty similar (you be the judge), lump them together as a single task
2. Add the total hours for each task
3. Add all the hours for total hours
4. Break down the hours per task into percentages of time used in the week
5. Calculate the percentage of time spent on important tasks

For the truly heroic, tell me in the Comments section below how close your expectations matched your reality.

And now, if you’ll excuse me, I’ve really got to fix this squeaky chair…

Written and contributed by Cynthia Sarver, Successful Options Trader of the Month – February 2016