Reminders From Diverse Sources
Or, the importance of a process June 1, 2015.
Everyone who is in the market knows that one needs to have a ‘steady approach’ towards investing and trading to become successful. Those who are all over the place or try to do everything at once do not succeed. To that end people learn technical or fundamental or derivative analysis and expect that this knowledge would help them achieve their goal of profiting from the market. Most of the time, it doesn’t. Then they grow frustrated and seek out the next tipster believing that will do the trick. That doesn’t either. More frustrations and now they hunt for the khabri- the man with the ear to the ground. No guesses for knowing that it didn’t work either! At this point, most investors and traders are probably stressed out- wondering what to do next and how they are going to manage?
Someone sent me a small video in which Sadguru Jaggi Vasudev was talking about Stress Management. This is a widely discussed subject and many books have been written about it. Vasudev put it rather simply by stating that we never have to manage stress, mainly because stress is not part of us and the only we thing we really manage are what is dear to us- such as our possessions, our children, our health etc. By calling it “stress management”, Vasudev says that we are actually making stress a part of our persona! How wonderfully true! By way of explanation, he further states that we feel stressed not because it is part of a situation (such as your job) but because of our inability to deal with that situation, with our emotions, or even our actions. As he wonderfully put it, life is all about content which cannot be changed easily but we can certainly change the context of our life by changing the way we deal with the problems.
Traders and investors in the market are, most of the time, complaining about how things aren’t ‘ right’- meaning they are always going on and on about the “content”. Instead, if they shifted focus to the “context” which is really their own actions , then there could be a big shift in the view. Losses occur because traders and investors don’t bother to create a process for entering and exiting the markets. Once there is a process for doing this, then the stress associated with what to do next disappears. That is why the focus of every player in the market should be about the process- which we define as Method. While it may seem impressive to be able to ‘read’ the market and respond to it without any effort, it has to be realized that such automated responses are a result of many, many months of continued practice of a set approach, a definite method. Creating a method- whether it be technical or fundamental- is mandatory for creating a stress-free approach to trading and investing.
We keep getting reminded of the need for a methodic approach time after time but we ignore it every time because it is either not exciting or demands work, or worse, demand discipline! The video of Sadguru was a good reminder yet again on the importance of having a method, a process, a way of defining the context of our action in the market and renewed my commitment to it yet another time. Look around you and you will find many reminders asking you to be more process driven. If you start listening to those reminders, you may see a rapid shift in your results in the market and indeed, even in your life.