The Ingredients Necessary for Trading Success
The presentation is quite dry but the information within the video is very good.
The focus of the talk are the professional gamblers however it is every bit applicable to traders.
It is a side proof that intuitive traders do have an edge and can develop superior skills to beat the markets over time.
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I may not agree with Michael Shermer on everything he says but this video is something every newcomer to trading should watch and understand every word he says.
Notice in the middle of the video about the baseball players – when batting rate is so low even for professional players, they are also the most superstitious.
As Mr. Shermer pointed out, people like to believe in conspiracy. In trading, blaming something totally beyond control makes it easier to accept the loss you took. But that does not excuse you from failing to take proper measures and steps to avoid being victim in such situation. As a minimum, isn’t it sensible to minimize the potential losses?
In another words, if you believe the market you are trading is rigged, it is important to make sure that,
1. you never trade that market again, or
2. you do everything you can in your power to never become a victim of the scam in the future
You have a choice. It is totally irresponsible when you know you are likely going to lose money and you still bet against the likely potential outcome.
Trading is about making money – nothing else matters.
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This TedTalk by Maomi Klein was filmed back in December 2010. It focuses on the major events at the time like BP oil spill and the worldwide financial crisis. It is a talk longer than the other ones at about 20 minutes.
The perspective of this talk is very interesting as Ms. Klein asked some very interesting questions on how we get ourselves into these mess again and again. This lack of consideration of the potential consequence and the unwillingness to take action avoiding known disastrous outcomes have been the recurring reasons leading to all these problems. As a collective whole, humans have failed to stop one disaster after another because we gave a free pass to those at the top who are prone to reckless behaviour.
As a trader, however, you do have a choice to take action stopping yourself from engaging in reckless risk taking. It is not the aggressive stances you made in trading that keep you profitable. It is the voice of reason in your head that made you pull the plug on those very bad trades that save your behind.
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