Why Woody Hayes Would’ve Been a Great Trader

by Darrin Donnelly on March 1, 2012

“To hell with exciting.  I’d rather be drab as hell and win.” – Woody Hayes

Traders need to adopt the Woody Hayes philosophy.

Football is a lot like trading.

In football, the fastest and most exciting way to try to score points is by throwing deep passes regardless of where you are on the field.  On any given down, a big pass play that goes for six is always a possibility.

Exciting?  Yes.

Practical?  No.

Throwing deep on every play may result in a touchdown here and there, but the odds are much higher that going “all or nothing” on each play will lead to a lot more turnovers than touchdowns.

Instead of trying to score a touchdown on every play, smart plays are designed to first pick up positive yardage.  Enough positive yards and you start picking up first downs, no matter how exciting the manner in which those yards are gained.  Keep racking up first downs and you’re eventually in position to score a manageable touchdown.

Woody Hayes, the legendary Ohio State coach who won five National Championships, took this method of choosing the practical over the exciting to a whole new level.  He was known for his run-first, grind-it-out, “three-yards-and-a-cloud of dust” offenses.  He could care less about how exciting his plays were.  He was only interested in grinding out 3.5 yards-per-play.  As long as he did that, he’d keep the chains moving and his team would eventually be in the end zone.

Hayes knew this style of play was rather boring to many observers.  But, he preferred to be boring and win rather than be exciting and lose.

Hayes actually put it a little more bluntly: “To hell with exciting.  I’d rather be drab as hell and win.”

This same philosophy works in the trading world.

Lots of people are drawn to trading for the same reason they’re drawn to Las Vegas.  They’re in it for the excitement.  They’re in it for the thrill of the risk.

Needless to say, those who start trading because they’re seeking excitement end up losing lots of money very quickly.

Most people think that trading success comes to those who take the biggest, boldest, and craziest risks.  Due to the movies they’ve seen or the stories they’ve been told, they think Wall Street fortunes are made by going “all in” and risking it all on that one big trade – sort of like playing slot machines with your last few dollars.

Contrary to this popular opinion, successful traders don’t get to where they are by hitting the jackpot with one big trade or one lucky break.

Instead, they get to the top by grinding it out, one first down at a time.

Successful traders are deeply committed to limiting their risk.  They never “bet the house” on a single trade.  They pride themselves on taking disciplined action.  They recognize that the real money is made by sitting, not in taking constant acting.

As the legendary trader Jesse Livermore said, “It never was my thinking that made the big money for me.  It was always was my sitting.  Got that?  My sitting tight!”

It’s not as exciting to hear these true success stories, is it?  We want to hear stories about overnight millionaires who swung for the fences on every trade, not “boring” stories about traders who spent most of their time sitting and waiting for just the right moment to enter or exit a trade.

Here’s something winners know that most people don’t.  Lasting success doesn’t come to those who just happen to beat the odds with one longshot moment.  True success in trading (and in life) comes to those who make small decisions each and every day that eventually add up to big victories (and huge fortunes).

Most of these daily decisions look boring to outsiders.  They involve discipline, long hours of studying, and sacrifice.

Winners are willing to make short-term sacrifices in order to achieve long-term results.  They forego what might be the most exciting option at this particular moment because they’re determined to win the game in the end.

When faced with a trading decision, make sure you ask yourself if you’re choosing short-term excitement over long-term results.  Contrary to popular advice, “living in the moment” and just doing what “feels good” right now will rarely lead to lasting success.

As Woody Hayes so eloquently put it in the quote at the top of this article, how exciting a particular moment is has little to do with the final results.

Don’t choose short-term excitement over long-term success.

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