Thanks to one of our favorite clients, Rob from Australia, this quote made it’s way into my inbox this morning.
“Nothing is constant, nothing is the way it has always been. So what I find is that people who are really good at this have great intuition, have great instinct. Their gut actually tells them something. The mathematics are important because they demonstrate you understand the problem.
But ultimately the decision about whether or not to take a given risk I think is really a human judgement call in every sense of the word.” Ken Griffin Citadel Investment Group from Niall Ferguson DVD The Ascent of Money
This is the KEY – focusing on improving your judgment calls. You can’t be perfect, don’t need to be perfect and can only get better and better at reading market personalities and moods. Make this your qualitative goal then put some arithmetic objectives into it to be able to track if you are indeed getting better at judgment.
The exits are going to be the hardest. You will always feel you could have done better. That is one of the pieces of emotional intelligence so key to being a great trader – knowing and knowing what to do with that feeling.
(…and yes, it just so happens to be one of the main topics for tomorrow’s online workshop, I admit it :).