What other blogggers are saying

More good advice from the doctor (Dr. Brett Steenbarger):

"The need to be right reflects concerns
about self-esteem and the need to prove and validate oneself. This is
not a market issue, and it's most likely an issue that affects other
areas of life, from work to relationships. If one, for example, spends
a great deal of time arguing in relationships over who is right and who
is wrong
, it wouldn't be surprising for them to fight markets…

In a good relationship, it's more
important to preserve trust, harmony, respect, and love than to
validate oneself. Interestingly, when there is such an environment,
that is the most validating of all!

It is similar with markets."

MW: [I spent many years 'arguing with' the markets – and the result was always the same:  the market was right and I was wrong.   It feels better to be market neutral with only a mild rooting bias.]


From Bill Luby at VIXandMore:

"The CBOE Volatility Index…,VIX, seems to be settling comfortably into a range
between 22.00 and 30.00 that is has traded in since early July. Given
that the relatively narrow eight point range has now held up for three
months, there is a natural tendency to wonder whether the VIX has
started to form a natural top and bottom that will result in an
extended stay in this range…
I still think there is a strong probability that the VIX spends the
balance of the year in the same range that it has been during the past
three months."


Tadas Viskanta at AbnormalReturns.com writes a blog that often highlights the best writings of others.  His recent post about investing for the long term in a post-crisis world deserves special attention:

"The next ten years
may very well be a good time to be in the equity markets.  However
planning on that is a very different thing.  A more prudent approach
would recognize our inherent limits in forecasting future returns.

So no matter how well you plan, the future isn’t guaranteed to anyone.  The capital markets are going to do what they are going to do
whether you participate or not.  All an investor can hope to do is try
maintain a flexible approach and stay in the game.  Only those
investors who stay in the game will be able to capture some gains along
the way.  Nobody said investing is easy.  Nothing worth doing ever is."


6 Responses to What other blogggers are saying

  1. Sigma Options 10/14/2009 at 6:34 AM #

    “MW: [I spent many years ‘arguing with’ the markets – and the result was always the same: the market was right and I was wrong. It feels better to be market neutral with only a mild rooting bias.]”
    Amen Mark,
    As my latest blog posts on the Spoooz highlight. I have a directional view, for amusement value. But it feels better not to have to be right about it, viz, be d-neutral.

  2. Mark Wolfinger 10/14/2009 at 9:32 AM #

    Why is this a lesson that takes so long to learn?
    It’s our need to be right. That should be trumped by our desire to make money. The problem is I want to be right and make money. Oil and water!!

  3. Sigma Options 10/14/2009 at 12:03 PM #

    I’ve heard people blame it on the school system in the western world.
    Valid hypothesis, but I wonder if it is something more intrinsically human?
    I came to trading from being a semi professional punter on racehorses. You get used to being wrong most of the time there, I had a head start in not trusting my own opinion, lmao.
    It still shows up in other areas however… it’s an ingrained trait it seems.

  4. Mark Wolfinger 10/14/2009 at 12:11 PM #

    I don’t believe it’s univesal. Taking Dr. Brett’s premise that if it applies to your relationships it will carry over to trading, don’t most people have relationships in which being right – and consequently proving the other person to be wrong – is NOT part of the deal?
    I don’t know the answer to that one. I’d hate to think of this behavior as ingrained.

  5. Dave 10/14/2009 at 4:42 PM #

    Whenever I use the words; “I’m sure, positively, absolutely or I know” a little red flag in the back of my head pops up and starts waiving. Best advice in markets (and life) I’ve got in 53 years was from a book on sailboat racing; “go with the flow”
    …damn hard to follow sometimes…

  6. Mark Wolfinger 10/14/2009 at 4:46 PM #

    Many traders do believe the trend is your friend and never fight what they see.
    Agree. Makes sense, but not so easy to do.
    I believe the problem is that it is really is easy to accomplish. Just begin. But, I’ve been anti-trend (or neutral) for so long, it’s not as simple as ‘just do it’