Expect To Change Your Opinions
"There are two things that must be rooted out in human beings — arrogant opinion and mistrust. Arrogant opinion expects that there is nothing further needed, and mistrust assumes that under the torrent of circumstance there can be no happiness."
— Epictetus, Discourses
A very interesting meditation today and it is something that immediately resonated with me, to trading.
We look for trades based on the stats/data that we have available and then go through the rules/criteria that has to be met for our strategies, to then actually execute and manage our trades to conclusion. We would expect the trades to go in our favour based on the historical stats/data and the likelihood of it happening again.
Once a trade is executed and the market is in play however, we must now change to a neutral opinion because as we know from experience, even if everything is stacked in our favour, it can still go completely wrong! By trading what we are seeing happening with a neutral mindset, we are not ending up in the land of hope, if a trade is going against us and we will exit for a controlled red as pre-planned if this happens.
Believing that our trade will go our way once we have entered it and it has gone in play, will cloud our judgement and we become a liability and put our bank at risk!
So although we trust our strategies and know that they will work many more times than they won't, we cannot be 100% certain and trade with an arrogant thought process that we are on a winner!
To re-cap we will have an opinion pre-event, based on the rules/criteria for our strategies and if we are happy that it fully meets everything, we will trade it. Once it goes in play we need to be ready to expect that anything can happen and manage our trade accordingly. We either take our targeted profit and move on when it goes to plan, or exit in a heartbeat taking our controlled red when it doesn't!
Our opinion changes from expecting the trade to go in our favour, to a neutral opinion once we have entered the trade, because we always have to be ready to expect the unexpected!