There's Nothing Wrong With Being Wrong
"If anyone can prove and show to me that I think and act in error, I will gladly change it — for I seek the truth, by which no one has ever been harmed. The one who is harmed is the one who abides in deceit and ignorance."
— Marcus Aurelius, Meditations
Today's meditation is very interesting when we compare this to trading.
We are forming an opinion based on the stats/data that we have available to us. If this potential trade then fully meets the rules/criteria for our strategy, we will trade it. This doesn't mean that we will be right on every occasion of course, but the odds will be stacked in our favour, meaning that we will be right many more times than we are wrong! We also have to bear in mind that we are trading an event and not gambling on an outcome. If a trade starts to go against us, we will cut it short in a heartbeat before any real damage to our bank can be done! This is what keeps us in the game long term and keeps us profitable.
In conclusion, "there's nothing wrong with being wrong" when we are trading; as long as we are fully managing our trades to completion. This means that on the odd occasion when we are wrong, our loss is controlled and limited to our pre-agreed exit point. Sticking to our disciplined exit plan when a trade is going against us, ensures that we will be profitable in the long term. This is of course, our goal, as we strive to become successful on our trading journey.