“The media has to latch onto something bearish when the market goes down and something bullish when the market goes up, so that you think you need their news, and therefore you tune in to them every day even though you don’t need it. So that’s how the news on Wall Street works.”
— Bill Meridian
“That monitor is not your friend. It’s basically a mirror, looking at all the psychological imperfections it can find in you…it makes you want to do overtrading…you act on impulse, it leads to errors, it leads to exhaustion, and the worst thing that happens is it leads to frustration. And the frustration is where it starts tearing at the old trader’s soul. Try to plan the trades that you really want to do.”
— Larry Pesavento
Don’t stare at the market.
Don’t act on impulse.
Don’t overbuy a position.
Don’t add to a losing trade.
Plan your trade.
Know what you’ll do if you’re wrong.
Know what you’ll do if you’re right.
Subscribe to Options Hotline today to vie for fun and profit.
Happy Friday and enjoy your weekend!
Capt. Louis Zamparini, right, and Capt. Fred Garrett in California following their release from a Japanese POW camp, 1945 h/t PCS/Associated Press
“All your trades must be at position sizes that make you unbreakable mentally and emotionally.”
— Steve Burns, @SJosephBurns
h/t Getty Images
“Investing is 5% intellect and 95% temperament. It’s a test of how well you can sit quietly when your emotions are screaming at you.”
— Ian Cassel, @iancassel
“Most people don’t want the truth. They want a secret. So if that’s what you want, I’ll give you the only secret you will ever need—there are no secrets.”
— Nick Maggiulli, @dollarsanddata
There is no holy grail for traders, but there are great tools to help you. With knowledge, courage, discipline, and hard work you can put probability on your side.
Illustration of the fools of Chelm, by Maurice Sendak, in Isaac Bashevis Singer’s short story, The Snow in Chelm
“The difference between being very smart and very foolish is often very small.”
— Amos Tversky
“All too often we feel like kicking ourselves for failing to foresee that which later appears inevitable. For all we know, the handwriting might have been on the wall all along. The question is: was the ink visible?”
— Amos Tversky
“Remain calm. All is well.”
— Animal House
Fed Chair Jay Powell, pictured above, discussing the NY Fed’s repo actions and growth of the central bank’s balance sheet, during Wednesday’s press conference.
“I’ve always felt ideas were a dime a dozen. If you had one that didn’t work out, you should not fight too hard to save it, just go find another.”
— Daniel Kahneman
That can be applied to trading. Examine your decision-making process.
As a general rule, never add to a losing position. Hone your money management survival skills, so that inevitable losing trades don’t knock you out. You want to be there to reap the benefits of your big winners.
After all, there’s always opportunity in options.
PS Check out Michael Lewis’ The Undoing Project, about groundbreaking psychologists Kahneman and Tversky.
“Doubt is not a pleasant condition, but certainly is an absurd one.”