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Friday, 30 November 2012

Zealot, Atheist, and Agnostic

Have you wondered which one is you when it comes to your investment/trading beliefs?


Zealot and Atheist

A Zealot and an Atheist are on opposite side of the spectrum. But they are very much similar than you think - both their cups are full; and they both think they are right and the other person has some serious issues. They are great talkers.

Common arguments or debates between academic and cantankerous (I learnt this word from reading Garfield) market participants are:

1. Fundamental versus Technical analysis

2. Investing versus Trading for success

3. Passive indexing versus Active stock picking

4. Buy-and-hold versus Market timing

5. Dollar-cost-average investing versus Lump-sum market timing

6. Price action versus Technical indicators

7. Dividend yields versus Capital gains   

8. Astrology versus Dart throwing by monkeys (voodoo or what?)



I personally think it's a case of who shouts the loudest wins! 

Both sides can throw the "book" at each other. There's never short of new studies by academia to back them up. Never under-estimate the human ingenuity to selectively data-mine information to back-up a preconceived thesis!


Or they can fight a proxy war by chanting and invoking their respective iconic gurus. My guru more powderful than yours!
 

Agnostic

An agnostic investor/trader is someone who basically says "Gee, I don't really know. Do tell me more."

He is a listener.

And is humble to admit when he is wrong and switch positions.

He is not interested to be right. He just wants to makes money. Period.

Do not confuse an agnostic with the person who loves sitting on the fence. The person who sits on the fence just sits there. He does nothing.

An agnostic is willing to put money where his opinion is. Strong conviction but no vested positions equals a NATO.       

And he does not consider it's blasphemous to to mix a bit of fundamental with technical analysis. To trade around a long term core investment position. To have both long and short positions at the same time, etc.



Different seasons; different investing/trading styles. 

 

27 comments:

  1. Hi SMOL,

    This blog post has some serious metaphors! I read it twice and now I have to work the metaphors in my mind. Don't have as many grey cells as before.

    I just watched "Life of PI" last night. I highly recommend it. Little boy PI was a Hindu, Catholic and Muslim all in one. ;)

    ReplyDelete
    Replies
    1. AK, he is talking bad about me cos i just chor chor him a bit only...

      Delete
    2. coconut,

      Your're so vain! You probably think this post is about you. Don't you? Don't you? (Must sing out loud more fun!)

      LOL!

      No lah! But I did learn a lot about my past silly "convictions" after reading your comments and Fat's comments.

      If professional traders have to relearn new trading setups and famous hedge fund managers have either thrown in the towel or returned money to their clients, who am I to cling to my old belief that the market is discounting the economy 6 months later?

      Having said that, STI is getting near to my Oct and Nov shorts near 3100.

      Should I short the Dec SIMSCI if it touches 3100 again? Or do I take a step back and reassess that perhaps I am wrong with my bearish outlook?

      Go long on the breakout trade instead? (I need a mind flip for this trade!)

      Delete
    3. Hi coconut,

      Aiyoh, and I thought it was about me... Wasted my saliva. :(

      Delete
    4. haha just kidding.

      first lets talk about the STI direction, remember, "NOBODY KNOWS!", you cannot trade purely base on what you think the market will go, let alone you have no clue.

      you have to learn to trade the market, not trade your view of the market. but to start with a position, ofcos you have to have a view, or baise to one direction first. you can also have technical analyst or whatever to jump into a trade, it does not matter, what important is your plan of how you going to work out if market go down or go up.

      you cannot have fear or doubt when you trade, if so, don't trade and step aside. and also don;t be upset or regret when you miss an opportunity or cutting your profit too soon!

      all these emotional are very negative for good trading.

      Delete
    5. Yes.

      Watching patiently.

      I like to have skin in the game. To me, putting a small initial position is the best indicator.

      If makes money; market telling me I am right - can scale in and build up a bigger position.

      If stopped-out; market telling me go do homework again!

      Delete
    6. all these emotional things are cause by one thing and one thing only, you want to win and fear of losing (money).

      and that really is up upon you yourself, nobody else can help you even if they want to help.

      i just treat trading a very expensive game to play like golf or cars and if i lost, so be it.

      Delete
    7. i don't go to golf course and then worry about the money i spend, same as in trading, paying (for losses) is very justifiable.

      Delete
    8. I with you on this view!

      I prefer travelling alone as I can't stand companions who whine about spending money during travels...

      If money tight then travel budget. Nothing wrong what!? I stay in hostels where it's only $25 per night per bunk-bed.

      But if want to avoid spending totally, then don't leave Singapore! As if in Singapore eating and transport is "free".

      LOL!

      Delete
    9. so are you going short on this one?

      i had enough shorts on my stocks already to be comfortable over the weekend. i'm also fighting against the trend now.

      Delete
    10. I am lousy market timer.

      Since March 12, have been hedging/shorting the SIMSCI every month. Only made money May, Oct, and Nov so far.

      The other months, death by thousand cuts...

      Just make a wild guess what I will be doing?

      Delete
    11. I can take losses or what?

      LOL!

      Trend follower r' us!

      Although I avoid their extreme fanaticism and enamoured use of charts, I love their money management doctrines ;)

      Delete
    12. you only go short on simsci? and you don't go long cos of your stocks position am i right?

      so naturally you will want to go short again, but if your stocks are having gains, there is no worry or hurry to get short again right?

      Delete
  2. AK,

    You perceptive ;)

    This post is a metaphor disguised as a financial post on a recent "strong debate" I had with a close friend who is a stout believer.

    My friend got upset when I brought up shepherds and sheep within all faiths, and my old post about: We have the land, they have the book. After they came; they got the land, we got the book...


    http://singaporemanofleisure.blogspot.sg/2011/08/we-have-land-they-have-book.html

    ReplyDelete
  3. SMOL,

    I perceptive har? I am still trying to digest all the metaphors. Sometimes, when I sit still with a constipated look, I look like I am deep in thought and, possibly, perceptive...

    Shepherds, sheep, land, books... Wah! More metaphors!

    I have not had any religious discussions in years. I stop going there. No promised land for me. If anyone is going, maybe can help me book a place? Or maybe it does not work like that. :(

    ReplyDelete
    Replies
    1. LOL!

      I believe this present life of mine here on earth is not a full dress rehearsal for what may or may not come here after.

      Pure land paradise? Heaven and hell is already here in my life - it all depends on my thinking :)


      P.S. I'll probably jump queue on my deathbed by repenting and converting as plan B! How that for just-in-time supply chain thinking?

      I am an optimist!

      Delete
    2. You goooood! :)

      Somehow, I cannot think of myself doing that. It goes against my sense of fair play. ;p

      I am not religious but I enjoyed "Life of PI" although I have not worked through all the feelings and thoughts the movie created in me yet. It is that profound, I feel, or, perhaps, I am reading too much into it.

      Delete
    3. OK, OK!

      I go watch next week! Then we can discuss our reflections.


      Peace be with you and wo mi tuo fuo (never hurt to hedge).

      Delete
    4. Hi SMOL,

      "P.S. I'll probably jump queue on my deathbed by repenting and converting as plan B! How that for just-in-time supply chain thinking"?

      Ha! Ha! "Siang Te Mei" = "Sweet Dreams"

      It's really trying to outsmart GOD. If you really believe you should know by logic alone no one can save himself. If you can then why need His GRACE. You might as well say, "All people should follow me - the Enligtened One"
      Ha! Ha!
      Are you serious???

      Delete
    5. Ha ha Temperament!

      Please don't assume it's your faith I'm talking about. You think why I left it "vague"? Don't get me into trouble!

      If it's about faith in the Abrahamic religions, my odds is about 1 in 3 on getting it right. Even if I get it right, each faith has 2 or 3 main branches. My odds of getting it "right" gets slimmer with each smaller splintered denomination...

      If it's Buddhism, it's about wisdom and karma - I am just as "screwed" here... Average IQ and we can't undo what we have done can we?

      OK, jokes aside, I remember reading comic books from a cultish sub-group that shows you can be "saved" no matter who you are on your deathbed if you just repent and convert. That's how I got the inspiration for my comment above. I did not plug it out from thin air ;)

      Siang Te Me! That's what I thought too even though I was in primary school then.

      Scary how they "target" young children via comics!?

      Delete
    6. How about sudden death? No chance to repent. Want to be Gambler?

      Delete
    7. Like stock got suspended and delisted. No chance to repent. Die pain pain.

      Delete
    8. CW,

      I should be so lucky!

      If I live this life to the fullest (no procrastination till tomorrow or life after), isn't sudden death one of the best way to go?

      My first choice would be death during sleep. 2nd choice would be death during sex (preferable after climatic top but I lousy market-timer).

      A quick death is a blessing - pain or no pain.


      Death is not what most people fear. It's the regret.

      You have blog about the top 5 regrets of the dying. I've read it too from the original source ;)

      To a good life here and now!

      Delete
    9. "OK, jokes aside, I remember reading comic books from a cultish sub-group that shows you can be "saved" no matter who you are on your deathbed if you just repent and convert. That's how I got the inspiration for my comment above. I did not plug it out from thin air ;)"

      Ha! Ha! SMOL,
      Relax, no sweat. Almost all Christians know where the above idea most probably originated but it is all "twisted, warped thinking". "SIANG De MEI"
      Read below i think you will agree origin of "crooked idea" most probably from the Bible itself.

      Q: What can we learn from the two thieves crucified next to Jesus?

      First and foremost,that God,responds to a humble heart reguardless of it's sinful condition...Secondly,that faith in the cucified Christ,is the only requirement for salvation..(repentance,confession of sins and post-salvation works,are assumed)...Thirdly,the sacrifice of Jesus Christ,covers a multitude of sins...One thief believed,repented and confessed his sin,to Jesus...The other,was full of and blinded in,his pride and arrogance,not responding to the literal outstreched arms,of the Savior...

      Delete
    10. Thanks for sharing temperament!

      I'll keep that in mind.

      Pride goes before I fall; and arrogance drops when I am on my knees praying.

      Delete

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