Writing this blog here as a public diary helps me to stay disciplined, cause I need to be up to my game if others are reading, and I can also come to read the older posts to remind myself about my key principles.
When everything is going well and the value of assets is growing day by day, it can create comfort and bad habits start to creep in. For example, watching the market intraday and looking at the accounts with big green numbers, even though it’s totally unnecessary and will just create positive emotions. Until the inevitable tough day finally arrives, my long positions are in red, shorts rally in green and stuff is getting whipsawed into stops up and down, it quickly reminds me to stop watching. The trading system is all set up to keep placing odds in my favor together with risk management, so I should just step aside with total peace of mind and let the numbers play out.
There isn’t much more I can do after the trading system has been set up and is running, because we deal with an unknown future, and who am I to start doubting a proven method on short-term results, try to control the market, the future or outsmart the initial plan, predict the outcome?! That would throw me straight into the gambling crowd.
During the most volatile days I try to ignore all outside information besides the price data that I need to place orders. It’s a good feeling to not know what the news are writing about, even with the humane temptation to check, cause one can only imagine that if the market indexes are deep in red, then there’s bear porn all over the place with a roaring grizzly and red arrows down, pressing people emotionally to make bad decisions out of fear. I couldn’t care less what anyone thinks about the market, cause I know that the whole market is made up of all the different opinions of buyers and sellers.
The easiest solution is to just keep the day busy, so I kind of forget about the markets and do other things. Another option is to train the mind, meditate and be mindful not to look. I only need around 30 minutes daily to document trades and place new orders, then every 6 months I check the performance of my strategies. Everything else is mental masturbation, can feel good but is unnecessary. Easier said than done!
Right now I’m enjoying winter in Spain. It’s nice, warm and sunny most of the time. Spending time outdoors helps to get my mind off the markets and do more meaningful things. The more I’ve been involved in trading and financial markets, the more I understand that compounding capital should be a background activity, not something to stress about or prioritize in the everyday life. I’m training my mind in this direction, it gives me time and capacity to embrace the journey and learn new things.