In this episode, Trader XO breaks down his journey from banking and computer science into the 2017 bull run - and the painful lessons that followed after losing it all in 2018. He explains why 90% of traders fail, how embracing uncertainty is essential, and why risk management is ultimately a survival skill. We explore defining edge, expectancy, pattern recognition, and his 6-pillar trading framework. XO dives deep into psychology, recovering from tilt, building routines, dynamic risk sizing, and adding to winners. The discussion also covers strategy creation, volatility regimes, using LLMs for coding advantage, and journaling as a tool for longevity - ending with reflections on avoiding CT envy and focusing on the long game.
00:00:00 Intro, Trader XO background, CS/Banking origins, 2017 bull run luck, losing it all in 2018
00:06:10 The 90% failure rate, why normal thinking loses, embracing uncertainty, risk management as survival 00:13:50 Defining Edge, expectancy formula, speed of understanding, pattern recognition vs. predicting
00:20:10 The Trading Process, 6-pillar framework, trading as a professional sport
00:32:20 Psychology deep dive, myth of "controlling" emotions, A-Game vs. C-Game
00:50:08 The "Reset" phase, dissecting a recent tilt, danger of short-circuiting, recovering from losses 00:58:05 Essential library, top book recs, leveraging LLMs/ChatGPT for coding edge
01:07:42 Routine & Execution, building situational awareness, dynamic risk sizing, adding to winners
01:21:50 Strategy creation, 15 principles, defining hypothesis, volatility regimes, building a living playbook 01:34:50 Closing thoughts, avoiding crypto-twitter envy, journaling joy, focusing on longevity over quick wins
