Wednesday, February 23, 2011

The Daily Note - Rules and Discipline

Successful trading has rules; fact is everything has rules, including living. Each rule when followed  or when not followed has specific consequences; when or what, we do not know until it happens.

For example, we all know that: Stepping off a curb without looking; taking our hands off the wheel while driving; or accumulating debt can have bad consequences.  We know we are tempting fate, yet we continue to do it because  ___________  fill in the blank for yourself.  If your reasoning is that rules are meant to be broken, matters not  and if you have never done any of those in your life, I'm sure you can dig around in your lifestyle to come up with a few that will match the examples: not wearing a helmet while riding a bike fits too.

The point is in each example we are not following the rules: the rules for living or survival. But what if we commit those acts numerous times without suffering the worst consequence: dying.  We may get a good scare of two along the way but since it's nothing major, we continue to commit the acts and until it happens, we can hope and dream that the consequence will never come. Trouble is that the more often an act is committed, the more likely that the worst will eventually happen, therefore, we are taught discipline somewhere along the way of growing up, hopefully.

I, at times, think that discipline should have a test and adulthood not granted until it's mastered, but then not many  of us would ever become adults so be glad (perhaps) that life doesn't operate that way.  It does, however, dole out consequences both positive and negative depending on the degree of the rules and discipline practiced. It is why it's important that traders learn to use both hand in hand, for the best consequences and  benefits.  Rules can be ignored without discipline, and discipline can be ignored without rules, but put together they become a powerful and winning ally.

Happy Trading, Living and Dancing

The Daily Pick - NFLX

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