So I am sitting here in my local cafe pondering the wisdom of my first serious pool session after a surgery induced hiatus, the two words that spring instantly to mind are f#$cken and horrible. There is always a cost to everything and it is something we tend to ignore – it applies from the laws of physics to relationships and to trading. As I sat contemplating my cup of tea I watch the group of middle-aged cyclists on the other side of the cafe. Each one is wearing a piece of lyrca that is emblazoned with the details of some mammoth ride they have done, one even sports one denoting a mountain section of the Tour de France. Yet to steal from the late Clive James each one looks like a condom stuffed full of walnuts. The reason for which soon becomes apparent when you realise they are having champagne and muffins for breakfast. You might argue that it is Christmas so they can be cut some slack. The problem is this is my regular cafe and this is their semi-regular breakfast. There is always a cost to all of our behaviours and you cannot outrun a muffin.
Which brings me to trading. In reviewing trading plans and in the past few yews I have reviewed literally hundreds I have seen an interesting phenomenon – a profitable long term system has the legs out from under it by a short term system that the trader was not psychologically capable of trading. Think about this in terms of our lycra-clad chubbies, the long term system is their riding – a brilliant form of cardio. Their short term system is their breakfast which is designed for little more than emotional reward. It serves no other function in much the same way most people short term systems serve no function other than short term emotional reward.
There is always a cost – you have to work out whether the cost is worth it.