Game, Set & A Few Matches

What Professional Performance Asks When Things Don't Go Our Way 

British summer time is here, bringing with it a heatwave the likes of which we haven't seen since 1976. It also brings a spectacular sporting season with Wimbledon and the FIFA World Cup.

Observing both unfold, I've found myself reflecting on what professional performance really demands.

Sport has always provided useful parallels for trading and investing. This month I'd like to borrow one from an unlikely source. 

Aretha Franklin.

Respect.

Inspired by Dr Ken Long's football coaching philosophy (see notes below), I'd like to explore four simple ideas:

Respect the game.

Respect your opponent.

Respect your coach, and...

Respect yourself (my addition).

Respect the game

Imagine a situation where the last 14 trades you've taken, in a row, were losers.

Compound this with knowing those losses were in the public eye, recorded for all to see. Commentators, pundits, talking heads and a crowd of enthusiasts collecting the stats.

What might you be thinking about your system, your method, the game in general... and yourself? What might you be feeling and how might it show in your demeanour?

I ask because it was the question that came to me as I watched the Wimbledon Men's Singles Final.

That was the position Alexander Zverev found himself in as he walked onto Centre Court, having lost the previous 14 consecutive sets to his opponent, Jannik Sinner.

Knowing the world's eyes were upon him, he still had to walk onto court and bring his game.

For those who watched the final, we witnessed a man who harnessed focus, channelled determination and produced exceptional tennis, taking the first set and finally breaking the 14-set streak.

The resilience was obvious.

The subtler lesson was respect for the game.

Respecting the game is a well-known philosophy. Build competence, condition the mind, body and spirit and honour the rules and etiquette of the game. Implicit within it is an understanding that the game doesn't owe you a result because of the work you've done. 

It doesn't care that your confidence has taken a knock.

What it does is invite you to become the best version of yourself.

Professional traders and investors know this.

The market doesn't owe you a winning trade because the last 14 lost.  It doesn't care if you've spent half of your adult life analysing markets or staring at screens. I hate to say this, but it doesn't adjust itself to account for your frustration, effort or financial needs.

It simply asks this:

Be in the moment.

Remember that every trade, like every point in a tennis match, sits within a much longer series.

Clear the residue of the last loss, error, drawdown, win or exit.

Assess the opportunity as it stands before you, with the information available today.

Meet the conditions as they are.

Breathe.

Centre.

Then decide.

If there is action to take, act calmly and with measured risk.

One trade at a time…

Respecting the game naturally also means respecting whoever or whatever stands opposite you.

Respect your opponent

Of course, every game has an opponent.  In markets, the idea of an opponent is complicated. After all, who is the opponent?

There may be another trader on the other side of the transaction. An institution with greater resources, faster execution and powerful algorithms responding in milliseconds. Or simply a market expressing forces too broad and complex for any individual to control.

It's easy to see how a nameless, faceless market force becomes the opponent.

"The market is trying to stop me out."

"They know where my position is."

"It always turns as soon as I enter."

When a trader starts to think like this, they're no longer responding to the market.

They're participating in a confrontation.

The market becomes hostile.

The loss becomes an insult.

The next trade becomes an opportunity to fight back.

Respecting your opponent means resisting the temptation to underestimate, resent or demonise whatever sits across from you. Or... inside you.

It means recognising its power without surrendering your own.

Afterall, it is possible to compete fiercely while maintaining respect.

We saw that during the Wimbledon final.

At one set all, in a crucial third set, Sinner played a clever drop shot. Zverev slipped while changing direction, sprawling onto the grass in obvious pain.

Sinner immediately crossed the net to check on him and help him to his feet. The two shared a brief hug before the match resumed.

We often think performance is limited to what happens during the contest.  I’d submit it is much more than this.  It’s about conduct leading up to, through and beyond.  Unfortunately, we saw the less savoury side after the final whistle between Spain and Argentina in the World Cup Final when emotions were running high.  (Couldn’t write this article without mentioning the ‘footy’). 

So let me ask you… 

How do you carry victory? 

How do you absorb defeat?

Do you respond to the market as it is?

Or do you insult it, blame it and try to punish it for proving you wrong?

A trader may never shake hands with the person on the other side of a trade but there is still a question of conduct.  

Respect doesn’t stop once the game ends.  It also shapes how we receive feedback afterwards.

Respect your coach

England's World Cup Quarter-Final against Norway illustrated that perfectly. 

England won 2-1 and progressed to the semi-final.  That was the result.

The post-match discussion, however, revealed different interpretations of the performance.

Thomas Tuchel (England's coach) was openly dissatisfied.

"The result is fantastic. We're in the last four... but I'm not happy with the performance. In every sense."

He described England as:

"Sloppy. A lot of technical mistakes. Not fast enough. Not repetitive enough. We were lucky today."

When Jude Bellingham, who had scored both England's goals, heard what his coach had said, his response was brief.

"Yeah, well, whatever."

He defended the players.

"It's difficult out there. It's a tough shift. All the players have put in a tough shift."

The coach was looking at the quality of the performance and what would be required in the next round.

The player was speaking from inside the performance. He had experienced the physical effort, the pressure and the work required to get the team through.

Neither perspective was entirely wrong. They were simply looking through different lenses.  Which can make this one of the trickiest aspects of performance coaching.

A good result doesn’t automatically mean a good performance. Nor does a poor result automatically mean a poor performance.

You can win while making mistakes that will eventually cost you. You can lose after following a sound process in conditions where the outcome simply didn't fall your way.

It's our job to know the difference.

Trading is no different.

A trader makes money after ignoring their stop. The P&L says ‘success’.  The coach sees behaviour that could eventually destroy the account.

Another trader follows their plan precisely and loses. The P&L says ‘failure’. The coach sees disciplined execution of a probabilistic process.

Which result should be praised? Which performance needs correcting?

This is why the quality of the review matters.

Many traders' review goes something like this: 

1. Result

2. Judgement

3. Emotion

4. Reaction

The trader loses money, decides the decision was stupid which instigates feelings of fear, shame or anger.  From this arises behaviour which can linger into the next trade (hesitation, forced or impulsive trading) which creates more results, judgments, emotions and reactions.  The cycle is set.

A coach creates a different sequence and asks a few objective questions:

1. Result

2. Observation

3. Variables

4. Adjustment

What information was available…?

Did you follow the process?

What was outside your control?

What should be retained?

What needs adjusting?

What can be tested?

Observing the result as a data point distils it to what it is.  Information.  This is quite distinct from what happens inadvertently and unconsciously - a fusion with identity. 

You may not have a coach sitting beside you at the end of every session.

You still have a coaching voice. The question is...

Does it sound like someone trying to bring out the best in you?

Or someone who has already decided you're the problem?

Which raises another question.  

What happens when the coach is you?

Respect yourself

This is the one I believe is overlooked most often.  Yet, in my experience, it has the greatest influence on so much that follows.  

How you think. 

How you feel.

How you show up.

And ultimately, how you relate to the game, your opponent and your coach. 

The relationship you have with yourself will eventually shape the relationship you have with all three. 

It requires self awareness, objectivity, accountability, self-compassion, self direction and the discipline to do the next thing to the best of your ability. 

If we examine it closely, self respect is a portal into empowerment.  It’s a nuanced thing.  

Out of balance, one uses thoughts as a weapon to beat oneself up… the proverbial stick.  Or if unable to take responsibility, wields said stick towards others (at least in our minds).

Self respect allows you to see things as they are.  Not worse, nor delusionally better than they are.  

We’re not pretending that a poor decision was a good one.  Nor are we avoiding feedback, lowering standards or parlaying ‘blame’ at the foot of the coach, the market, or anyone else.

Listen to the difference: 

"You moved the stop. What was happening internally at that moment?"  Compared with: "You have no discipline.  You always ruin everything!”

Or, "You hesitated after three consecutive losses. What had you started to expect?"  Compared with: "You've lost your nerve. You’re a chicken s**t"

One approach examines behaviour and gives you something to work with. The other attacks identity, demands a defence and triggers off a spiral:

Thought (criticism) → Feeling (angry) →  Behaviour (acting out) → Result (loss/sizing up/risk adjustment on the fly) → Fuelling more 

Respecting yourself means developing an internal voice capable of both truth and proportion.

One that can say: "That was below your standard."

Without adding: "Therefore you are a failure."

It means recognising effort without confusing it with effectiveness.

Acknowledging progress without pretending the work is complete.

Seeing how far you've come while remaining honest about where you still get in your own way.

The way Zverev conducted himself after losing the Wimbledon final didn't alter the result. It did reveal something about the man carrying it.

The way England's players and coach reviewed their win against Norway didn't change the score. It shaped what they carried into the next match… which was exhilarating (read on).

The same is true for traders. No one may see your post-match interview.

There may be no microphone, cameras or reporters asking what went wrong. 

But there is still an interview.

It happens in your head.  At the desk. In the car. At dinner. In the middle of the night, when the market replays itself and you suddenly see everything you "should" have seen several hours earlier.

The language used in that interview matters.

Because that's the voice you'll carry back into the market.

Perhaps a useful trading review begins by separating four things:

1. What was the result? State it without embellishment.

2. How was the performance? Review your analysis, process, execution and conduct separately from P&L.

3. What influenced the performance? Consider the conditions, preparation, beliefs, emotional state and decisions.

4. What happens next?

Retain.

Adjust.

Test.

One final thought

As I conclude, I can’t help but ask the question, what might it look like if one were to tap into Dr Ken Long’s philosophy…

Play hard. Have fun. Support the team. Love the game. Respect your opponent. Respect the referee.

In this World Cup, the most prominent example of this coming into play, in my humble opinion, has to be the battle for third place between France and England.

Arguably the most free flowing game of the tournament. Both sides played as if they had nothing to lose, and everything to gain. A sense of freedom, pure heart and talent in motion, allowing for creativity to flourish, opportunities to be captured and a sense of enjoyment for all who observed (players and spectators alike) to witness and enjoy. 

At the final whistle, we witnessed both sides congratulating the other. 

Hugs, huddles and handshakes. 

It was a reminder that competition and respect are not opposites. In fact, the highest levels of performance often demand both and in return elevate both.

Imagine how this might play out for you as you engage in the markets. 

The markets will test our judgement, our patience and our conviction.  It will shine a light on the areas we still have opportunity to grow.  

Through all of it, the one voice you will hear more than any other is your own.

Choose to make it one that speaks with respect.

• Respect the game.

• Respect your opponent.

• Respect your coach.

• And remember to... Respect yourself.

Notes

1. Credit where it's due

The inspiration for this newsletter came from Dr Ken Long of Tortoise Capital Management, who I first heard say:

"Respect the coach, respect the ref, respect the other team, respect the ball."

He also uses the phrase:

"Play hard, have fun, support the team, love the game, respect the other team and the ref."

Originally developed to encourage the young football team he coaches in Kansas City, USA, Dr Long has since applied the same philosophy to the world of trading and investing.   Absolutely brilliant.

For the purpose of this newsletter, I've adapted the framework slightly by adding one additional element that I believe underpins them all: Respect yourself.  Calibration from the inside ultimately affects how we engage with the outer world and the beautiful game of life in all aspects be it trading, sport or otherwise.

2. References

• Jannik Sinner helping Alexander Zverev to his feet after his fall at Wimbledon. 

• Spain v Argentina World Cup Final - Conduct

• England v Norway Quarter Final - Post match interview

• France v England Third Place Match - Final Whistle - Sportsmanship

• As it’s summer, a little link to Aretha Franklin’s Masterpiece : Respect