Mr. Cool starts his day.
He wants to know what other people are doing. To be more exact, what they are trading. He listens to tips. Actually, “listens” is an understatement. He’s hungry for tips. He shorts strong stocks, and goes long those that have corrected. He wants to be Mr. Johny-on-the spot where the action is.
Mr. Cool gets up late. Of course no preparation for the trading day is on the agenda. In fact, he has no agenda other than the format stated above. The day starts off with a call to the broker. What’s moving? What are the news projections? Any hot tips? What’s this analyst saying?
Mr. Cool doesn’t live long in the markets. His “strategy” of trading long into correcting stocks and shorting strong ones pays off 80% of the time, but when it goes wrong, it goes wrong big, in fact so big, that Mr. Cool doesn’t feel so cool anymore. He holds on to his losses. He’s scared of taking the hit. He hopes that prices will reverse to his entry price and then he wants to exit. This time around, it doesn’t happen, and his cheap options expire worthless, leaving him broke. By now the markets have scared him so much, that he nevers trades again.
Mr. System Addict is everything Mr. Cool is not. He has a system, and he sticks to it. No tips, no news, no rumours, no non-sense. If the system indicates a buy, he goes long. If it indicates a sell, he goes short. If an exit, he exits. No looking here and there. Belief in the system. Trade to trade system development and enhancement. Solid pre-market preparation and after-market analysis. The works.
Mr. System addict has been around in the markets and he’s going to stay. He’s doing well. Initially, he used to be Mr. Cool, but then he went bust. The only difference was, that he had the strength to lift himself up and become Mr. System Addict.