Posted by: jhamon | June 17, 2009

The Hardest Lesson of Trading…

Willow tree

From grade school forward we are trained to take a position and to defend it fiercely to the end.  It carries right along into high school debate, a doctoral thesis defense and on to the O’Reilly Factor.  (If in doubt, talk louder!)

That’s why it’s so hard for many people to master trading: it’s not about being right, it’s about being aligned to the market because the market alone is right.  This isn’t some goofy pseudo zen-ism. 

Think about it: the real value of some asset you own is exactly what you can get someone else to pay you for it, not what you think or it’s worth or what you paid for it.  Millions of homeowners around the country and the world are learning this lesson right now.

Instead, my mentor Astro Willie suggested that the successful trader is like the willow which bends in the wind but does not break

If the market moves against you, it’s easier to change your mind (exit with a small loss) than to change the market.  A “fold early, fold often” strategy is at the heart of any successful trading program.

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©2009, FractalBox Advisors LLC


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  1. […] At FractalBox, we have learned that predictions and opinions are a great impediment to trading success.  It’s better to deal with what the market is telling you right now. […]

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