So today is going to be super brief and it’s going to be a provocative question. It’s geared and aimed at those of you who are offsetting winning positions at the end of the trading day during normal trading hours, whatever that’s called my thought is that your fear of losing might be several multiples, the feelings that you have of winning, right? So to avoid the pain, you do something that’s not financially in your best interest, which is to offset a winning trade. So imagine this scenario on the other side, every day, it’s very, very hard to find winning trade. So my ethos is to stay with the winners for as long as you can and position size it accordingly so that you can withstand any changes financially in the volatility of underlying instrument, there’s enough room to do one contract there’s enough room to do five shares.
My belief also is that looking at short time frames intra day, doesn’t give you any more control over the instrument than if you had delayed quotes and put in a protective stop. So imagine you’re in a winning trade and you’re up 2R, and you kept it overnight. And the thing opens very, very strongly in the direction that you have, like you own it, right? And it opens up big. So that now your gains are potentially 3, 4, 5R. Right. How does it feel to miss out on that? Is that painful too? And what would it feel like to miss out on that and to put on another one or two trades that day that are losers. So now you have the compounded effect of the opportunity cost of not being in a winning trade that you are already in, and then putting on two new trades that are losers.
I don’t know why people turn this into blue collar despair that lose you money. Because now you’re a loser on two fronts. I believe that that’s an irrational fear. And if you look at the data and you’re buying things that are in up trends, look at the data and see how they, how the opens are. Do they open up with you or against you? Because you can’t take anyone’s opinion on this in blind faith. You need to look at the data and not to sound like a priest, but the data’s going to set you free. You might be holding yourself back from greater success by having an irrational thought because you get this Johnny Cochran logic anyway, consider subscribing we’re all over the place. YouTube, Audible, Stitcher, Spotify is the big one. You can get your copy of the audiobook version of the Inner Voice of Trading at MartinKronicle for free. It’s on me. Thanks for being here. I’ll see you tomorrow.
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