|
I read a great quote over the weekend in the Astrology section of the Sunday paper. It said under my star sign that you have to measure the “freight costs of your ambition”. I thought what a great way of discussing the road to your outcomes. Like all things worthy of effort, learning to trade will have its fair share of trials and tribulations.
In recent times there has been many negative comments in the media and even some by traders, you have to ask why the negatives - well its human emotion. Many people have failed to “stop their losses” hence they are in pain and believe me I get it. I feel for those that have seen life savings vanish, retirement delayed for some extra years in the work force. There is too much hindsight analysis in the current market, where you should have got out etc, etc, etc.
So I ask you leading into next year what is the freight cost of getting your trading ambitions fulfilled into 2009? There will be a time cost, you need to study properly and learn the lessons that David is laying down for you through the Safety in the Market materials. There are no free rides so except there will be some costs to a program of action; and get a list going of what action you will take in the near, medium and long term.
The bear market we have seen based on the S&P 500 is now the biggest retracement in percentage terms for this century. Trading on the long side has been fraught with peril, being short has also had problems, but short trading CFD’s is back on the table for most non financial major stocks.
So what action have you taken to sharpen these tools that have been in your tool box, lying unused since 22nd September?
I would also hasten that rebuilding lost capital should be viewed as a medium term process. This means look at the next 6 months as the opportunity to regain confidence, skills and capital by getting regular chunks from the market. Taking profits at 75% milestones may have seemed too conservative 12 months ago; with volatility high it’s been somewhat harder to hold for longer moves. In short be happy with the ranges this market is giving and be happy to lock in profit when it’s on offer.
Finally for the many that have seen their accounts grow in recent times, now is a watchful time for the psychology side. It’s always after a good time in the market that we open ourselves to the biggest mistakes. 2009 is a stone’s throw away and you do need to focus on where you want to be this time next year.
It’s ok to set big goals and strive to achieve them, who know falling a little short may still be a huge victory.
Good Trading
Aaron Lynch
|