Tuesday, October 29, 2013
Tolerance - A Trader's Mindset
I am increasingly amazed by the quickness of people to condemn others. Examples include road rage, comments on the internet, political parties, and yes, even participants in the stock market. Somebody once said, "Just because we disagree, that does not mean we should be disagreeable". Disagreeing is normal - attacking the person we disagree with is not. It is almost as if proving the other point of view as wrong, automatically proves us to be right. Worse yet, assassinating another's character proves that they deserve no say in the matter, even when the two are not even related. Often the truth lies somewhere in between various points of view.
Once And For All
What works for one, seldom works for all. I have to laugh at the advertisements which suggest if we are not using their solution, or their product(s), that can only mean we are obviously doing it all wrong. The fact they try to suggest that they know what is best for me, without even knowing me, is comical, if not misguided. But to attack me because of what I believe, is nothing but intolerance, plain and simple. When did we become so intolerant of other points of view? Maybe it just goes hand in hand with our intolerance of other people who don't look like us.
Buy and Hold
Can we really believe there is only one correct approach to the stock market? Again, I laugh when "experts" look down their noses in disdain at anyone they believe is behaving contrary to their "buy and hold" approach. It is as if traders are of the lowest class of people while (buy and hold) investors are what everyone should aspire to be. Clearly, there is no such thing as timing the market, so not only is anyone attempting it, ignorant, they are probably really, really bad at managing their financial affairs, as well! Not.
One of the reasons many can't believe timing the market could ever work, despite evidence to the contrary, is the so-called high cost of trading. Everyone knows, the more we trade, the less we earn. I have just discovered an interesting concept which would help explain why that is not always the case. Next time, I will go into more detail.
I did not start this blog post with the mindset that all traders are tolerant, and all investors are not. Believe it or not, markets actually represent people of all viewpoints. What one person wants to sell, is exactly what another wants to buy. We don't (and shouldn't) judge the person on the other side of the trade. The market is able to exploit any weaknesses we might possess, and makes us pay the price, no matter what our strategy. Still, if there were only two choices, (which I don't believe is true), I think I would rather be less wealthy and tolerant of others, than rich and falsely believing I was smarter (and hence, better) than everyone else. Why? Because being able to let go of judgement, I believe, makes me a better person as well as a better trader.
What are your thoughts?