Wednesday 9 July 2014

Trading is lot like the movie Edge of Tomorrow

Yesterday Tuesday afternoon, I went for my discount movie watching fix. 

What do you know?

This Tom Cruise movie Edge of Tomorrow was surprisingly entertaining!

It's Groundhog Day meets Starship Troopers.

For Sci-fi buffs, it's not anything "new"; but for casual movie-goers, I heard some people mumbling what what was it all about? Didn't understand this; confuse about that - as we walked out of the hall when the movie ended.

Trading is Live. Die, Repeat or Entry. Exit. Repeat

A trade "lives" when we make an entry. It dies as we exit the trade. Then the whole process repeats itself in the next trade.

Each time, we learn something new - about ourselves, the market, and our trading vehicle.

Just like the movie, no? (Eh... You may have to watch the movie first)

Most traders do not have the "power" to Entry. Exit. Repeat.

Why? We are hampered by the Mind part of the Method, Money, Mind trilogy.

Some of us can't seem to learn from either our successes or failures. No matter how many 2nd chances we got. 

We can see it in our Corporate life. I'm sure you can spot senior colleagues who think, act, and function like their 2nd year in the company times the 10 or 20 years they were in the company - no growth in mental capacity.

And then there are those who stubbornly refuse to explore Money Management techniques. Clinging to the idea that if you "hold" a losing trade long enough, it will breakeven - one day.

Entry is trading; exit is buy and hold "investing" - schizophrenia is never good. 

The good news for the remaining surviving traders is we can Entry. Exit. Repeat. 

Can't wait till I hit my 10,000th trade!

It's a bit like the XXX hours flown for a pilot.

And the XX jumps of a sky-diver. 

There are no secrets or short-cuts. Just practice, practice, practice. 

And the ability to bounce back from a stumble.



  1. Can't be Entry. Collect dividend. Repeat?

    1. CW,

      Eh... I am talking about trading as in traders.

      No worries! I am hybrid. Can switch to investing mode quicker than Mystique (X-men) in shape-shifting

      Collecting dividends for investing is no different from enjoying positive carry in trading. It's just a by-product.

      Entry is initiation of a position.

      Exit is getting out of that position.

      The learning curve for "retail investors" is longer as you need at least 2 market cycles or 10 years to understand yourself - due to the infrequent exits or round trips.

      You were not exactly a newbie in 2008; you of all person should know the consequence of yield hog behaviour and ignoring exit.

      Now you are fully prepared by exiting with your capital safely under your pillow.

      You tell me whether you believe collecting dividend is an exit strategy ;)

      P.S. We learn by stumbling along don't we?

    2. CW,

      To sharpen our swords, we need a grindstone.

      Thanks for being my grindstone, you the best!

      And I return the favour by being your pokemon - poke here and there ;)

      I wonder where is coconut? Long time no play here anymore...

      Miss him. Not easy to find a pro trader to call out the chinks in our armour :(

  2. Ha! Ha!
    coconut is very busy preparing all the shots (shorts) lah!

    1. temperament, you want me to die faster is it?

  3. Hi SMOL,

    You are THE cheetah in this jungle of stocks and shares; ready to pounce whenever an opportunity exists.

    Ruthless trait of an outstanding trader.

    Good article, nonetheless.

    1. L Young,

      And I thought I am the Hello Kitty of stocks and shares....



  4. oh can talk already ah, say so la! damn i miss this place also haha...

    yes, trading i do the talking, but lately can't really talk much, volume go nose dive, drop as much as 50/60%!!! i soon eating grass.

    yes sir, entry, exit, repeat but also have to see the market face. low volatility hard to enter and exit. the worst thing is to up position size but can be done if couple with some changes in strategy. mean time i stay as it is, eat grass.

    so taking this opportunity to learn more on investing, didn't you see me at AK and CW place haha..

    1. why 10,00 trades?

      enough time to learn about yourself and the strategies you need, provided you can avoid losing all your money.

      but off hand i can tell you that trading as i found out, is nothing even close to living like a human as we know it.

    2. dispite all this, you know what, i'm very please at the pleasent moment. my girl soon will start her U, and also i will soon recoup all my losses i made 3 long years ago! lets hope that i don't make that silly mistake again which is up position size without any changes in equity.

    3. 3 bloody long years that i had been sitting here day in and day out almost without fail!

    4. Hey! Looks who back!


      I've made some small kopi money these 2 weeks doing range trading.

      Long simsci when STI around 3240, exit at 3270 last week.

      Short simsci when STI struggled at around 3290 and exit at 3270 yesterday.

      Market very boring when its not trending :(

      I guess have to live with ikan bilis for now. It's tough for trend follower like me...

      Congrats on your girl girl starting U and your recovery of you trading loss 3 years back. No wonder someone got money to buy new car!

      OK, I think I go write a new post on position sizing this weekend. Kick me if I go theory and bullshitt ok?

    5. old car la, i use it as an excuse so that i can pass the stupid honda to my girl haha...

  5. Being a movie buff, I can't agree more with you on your view. I guess the slight difference is the movie is without constraint of resource ie it just repeat but for investing we are always watchful about our capital/portfolio before Repeat ;-)

    1. Richard,

      The movie has a constraint - the power to "reset" is lost if you didn't die quickly and is "rescued" with new blood transfusion.

      I'll let you figure out why it's the same with most "retail investors" - it's the slow death of hope that stops them from this "reset" ability.

      You may want to ask CW what's the meaning of "not winning the same way you have lost". There's an exit somewhere ;)


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