There is a story I heard long time ago or may be I saw it on Victor’s Daily Speculations or was it some book?
Anyhow, Trader Steve caused my long term memory to partially come back and I told short story about “wishful trading” in the comment section of Disqus:
“…buddy of mine who said before 2009 collapse: "(SKF) to $200" (he bought it at 40 and sold at 45 and never been seeing again - especially after it hit 300+ )”
Where am I getting to with this nonsense?
I am getting to the ability to stay with position long term while it is working for as long as clear signal in opposite to trade’s direction is generated (whatever system you use)
Now, the story:
“A man comes to the race track and bets $10 on a horse.
He wins, and bet entire amount again.
He wins, and bet entire amount again.
He wins, and …you know the drill by now.
So winning he keeps [Yoda speaking] and finally has huge amount …and he bets it again
And he loses, loses obscene amount of money.
When he walks toward the exit of race track his friend stops him and asks: How did you do today?
Man answers: Not bad, I only lost $10.
The moral of the story (beside of always setting aside part of your winnings ) is that you can only lose your initial stake and you have to be able to stay with the working trade…or stop bitching about selling (SKF) at $45 after seeing it at $350.
And now for something completely different – Mark Faber on El Presidente Obama
