What Hitchcock teaches us about stock trading
|July 7, 2011||Posted by admin under Food for Thought, Intro to Trading||
By Cory Mitchell, CMT
“We humans like to see ourselves as rational creatures. We imagine that what separates us from animals is the ability to think and reason. But that is only partly true: what distinguishes us from animals just as much is our capacity to laugh, to cry, to feel a range of emotions. We are in fact emotional creatures as well as rational ones, and although we like to think we govern our actions through reason and thought, what most often dictates our behaviour is the emotion we feel in the moment.”
~Robert Greene, The 33 Strategies of WAR
Do not enter any battle unprepared, for it opens the gates to disaster. Instead plan everything beforehand so that impulsiveness does not enter the arena with you. Militaristic like disciple will lead to more fruitful endeavors than will an emotional mentality.
Trading is the same as any life path in which one strives to excel. All aspects must be mastered, with very little left to chance. The pattern for success is formulaic; authors with book sales in the millions and a plethora of books lining the shelves write based on a formula. Sitcoms are all very similar on many levels, using the same comedic ploys.
Formulaic strategizing works – it may flop occasionally but winners by far cover the losers. Know your craft and masterfully plan, don’t deviate, and over the long-run more winners than losers are produced.
Alfred Hitchcock was a prime example of this. His first film was a flop, The Pleasure Garden, in 1925. He had no control on what was happening and lacked the technical expertise to really run the film the way he wanted…even though he was technically in command. It was at that point he decided he needed to approach his career in a much different way.
Hitchcock learned everything he could about all aspects of filmmaking, sound, camera work, lighting, editing and the list goes on. He learned everything he could about the industry, immersing himself in it. He studied the types of people he would be working with and planned everything in advance leaving nothing to chance. Everything was so well planned that no one could mess up. All Hitchcock, and those around him, had to do was follow the plan he laid out…and it was laid out so well that it was nearly impossible to deviate from.
The trading arena is fraught with distractions, opinion, ideas, “news” and second-by-second changes in price, volume, bids/offers, volatility and sentiment. This will always occur and those distractions never go away…we know that…yet in the moment we can get caught up in it all. Like Hitchcock, we must prepare rigorously for each day. Prior to action what will be done, how it will be executed and what will be avoided must be laid out in explicit detail.
Life, and battles, are won at the margin. It is he who pushes past comfort, plans a little more and little further ahead and masters emotional constraint (so he can implement the plan) who wins the battle. Once the plan is laid out, let it run its course. You have considered all before hand, nothing is left to chance, and therefore emotions lack use once the plan has been hatched.
Sit back and watch your work. Smile, for when the day begins, much of your work is already done.
Cory Mitchell, CMT
Start executing your plan…Stock Trading Nitty Gritty This may be the ugliest video about stock trading you’ll ever see…but the message in the story is worth it. It’s about how a regular guy discovered 1 “unusual” trick in trading the stock market…and how he was finally able to get an “edge“ over everybody else – other traders & even his own broker – after years of trial & error. Watch it through to the end (refresh the screen if you need to pause it). Check out, and formulate your plan of attack: