WHAT MY MURDER OF A BIRD CAN TEACH YOU ABOUT TRADING
Drawing of today's events
Most drivers will encounter birds throughout the day as they are driving. Birds have this uncanny ability of dodging traffic. They accelerate at the exact right time. They manage to stop in the exact correct places. Their decisions are crisp. They know the exact trajectory and speed with which to take off in order to avoid becoming a hood ornament.
I'm driving down a city street in Los Angeles today. Not going extraordinarily fast. A little over the speed limit, perhaps. I spot a gentle, peaceful yellow bird hopping around the street. It seemed to be hurriedly attempting to nibble at what it considered to be lunch.
The bird that I encountered today must have been new to the traffic scene. It suffered from a moment of indecisiveness. It was so clear to me as I was watching. I saw the bird become cognizant of the fact that I was coming at him at around 40 mph. At that moment, the risk of satisfying his hunger with whatever it was he was after in the street became too great. I was within maybe 20-25 feet of him at the time.
He begins his attempt to dodge me by hopping to the left. I thought that it was a great move, as the left side of the road was clear and he could have just flown off back to his bird family, high atop a tree, in a better part of town.
But then out of nowhere, he changes his mind completely and darts off to the right, about 3 or 4 feet off the ground. A small thud is heard as the bird gets polished by the right front end of my vehicle. I cringe and then become sad for some period of time.
I immediately thought to myself, going right wouldn't have been a bad decision for the bird if he had committed to the decision from the beginning. It was going left for that split second that threw off his timing.
Going left wasn't a bad decision either. It was clear of traffic. If he would have simply stuck to his decision to go left, his day may have turned out differently.
My car didn't kill that bird, indecisiveness did. His bird brothers and sisters are dodging cars like mine all day. Their decisions are crisp and calculated. This bird, however, suffered from a split second of straddling the fence. It threw off his ability to time the escape correctly, costing him his life. Or her, it could have been a girl bird, I suppose.
The point is that the whenever you enter a trade, you have the same vehicles coming at you at 40 mph as you hop around the asphalt looking for crumbs to fill your stomach. If you begin doubting your instincts at the times when you sense danger coming at you, it's only a matter of time before your indecisive behavior causes you to become a permanent fixture in the hood of the market.
Saying that I'll stick with this trade for a few more days when your gut is telling you to get out. Or doubling up into a position that your instincts tell you was a mistake in the very first place. These are both examples of actions that are indecisive and harmful. It doesn't matter if you manage to avoid the car that is headed right for you this time around. It is inevitable that with indecisive behavior your day to become very familiar with the inner-workings of a xenon headlight are around the corner.
