Edge

Today is a good example of what keeps me under the water. Today is an example of my messed up karma. Now don’t think I am bitching or crying here because I am not and I am far past that point anyhow. And I am actually thinking that my karma is improving of late although today does not help my argument, I grant you that.

We are not really going to go into details about today right now…all things in their time and plus the wounds are too fresh to really poke around much without a bunch of pain coming to the surface and I don’t really feel like punishing myself today.

I did some positive things today, I went for a jog and lifted weights and I am even writing something here and that is a positive as well.  But I still feel like a piece of gum on the bottom of your shoe at the moment because I HAD the right trade and I backed the wrong horse AGAIN!

Man it is tiring to be so bad for so long. It is literally just a fucking beat down. Losing begets losing. Loser mentality leads to loser trades and loser results.

But again this is not me trying to cry a fucking river here. This is me talking about how you can be right and wrong at the same time and how if you have no edge you have no trade. That’s right no edge no trade. I thought I had an edge on one play and actually I did have one until a few days ago but as of this morning my edge was gone and I should have faced that fact and dealt with it properly but instead I let my bias screw me when I had another perfectly good trade in the bag and did not take it.

I backed the wrong fucking horse…again.

The trade I did not take was a stock I actually have good trading karma with and the other I have suffered and wrestled with for years. Another one of those corpses I talked about a few posts ago. Did I mention I even had an edge on the good one?

If you don’t trade you really have no idea what I am speaking about when I say I had an edge. Let me explain. At any given moment a stock can either go up, down, or trade flat or sideways. At any given moment of time you could literally flip a coin because even though I am a firm believer in charts and technical analysis in the short run anything can happen.

But an edge is like a little sliver of something you can lean against. Something you can hold onto when things seem to be going against you because after all, you have an edge. Something not everybody is aware of or something that not everybody even knows exists.

Take the example of blackjack. Say you are sitting in the anchor position at the table – commonly called third base or the position to the dealer’s right hand.  Third base is the most important player at the table since he is the last to act before the dealer.

Now say that the table is full of players and as I mentioned everybody acts on their hands before you get to act since the dealer goes from their left to right as the order of play. The dealer is showing a 10 value card up and needs to check if she has blackjack so she takes a peek underneath the face down card. She ends up without a 21 so play continues.

The first few guys bust and then let’s say the next couple of players hit their hands a few times but don’t bust and stand at some total. Now play comes to you and you are sitting on a marginal hand, say it’s a 12 which in most cases is a tough one to sit on and not that great to hit either since any 10 card and you bust. But in this instance you happened to have accidently caught a peek at the dealer’s hole card when she was checking earlier and you know she is sitting on a 6 in the hole.

That, my friends, is called an edge. It does NOT guarantee that you will win the hand. After all if you hit you might bust and if you stay the dealer can still out draw your hand but what you have is knowledge of something that nobody else knows (besides the dealer of course) and you can use that knowledge to shape how you play the hand.

In this example, especially with a few players sitting on their draws the correct play knowing the dealer has 16, is to stand and let the dealer try to improve since she must hit that 16. If you did not know what she held underneath, the temptation would be great to hit the 12 to try to improve the hand at least marginally, since a 12 won’t beat anything but a bust.

And the odds would be against you. But since you know you stand pat and take your chances with the dealers draw.

With an edge the odds are suddenly tilted just a little bit more in your favor. And I had an edge on a trade today and I took another one and lost and the one I had an edge on would have paid nicely. C’est la vie I guess but it chaps my hide to be a dumbass and not learn and not progress. It is a beat down and as a trader the most important currency besides a bankroll is to keep your confidence high. The only way you do this is to make winning trades or cutting losing one’s when it is the right thing to do.  See, it’s not even about always making money on a trade but in making the right trade at the right time. That keeps your self-confidence where it needs to be to able to play and to win in the caged death match we call the market.

I’ll recover but today is a setback, I won’t lie to you. Today was a little setback to my psyche.  I told you I am not healed yet, I am a work in progress. I will give you the good with the bad. I am human after all and if you were looking for the super trader dude who always wins and is cocky and gloats about how fucking smart he is that is not me. Go read any number of trading sites that will only tell you about how they always win and go jerk off to it because that is fantasy like porn is a fantasy. I am more like the fat chick at the party that has a great personality but nobody wants anything to do with.

Advertisements
Tagged , , , , , , , , , , , , , ,

3 thoughts on “Edge

  1. Allen G says:

    You didn’t really explain WHY you chose to ignore your supposed edge? Seems important to me, to understand that. Also, you are just too vague about the stocks involved. I don’t think absolute specifics of price and position are necessary if you don’t want to share them, but at least the stocks. I assume one might be google since I found the link to this at $goog stocktwits, but who knows.

    I am long google, and I don’t give a fk what it did today 😛 But I’m not high stakes option gambling either. If anything, it sounds like your picks aren’t as bad as your risk management, but hard to tell with no details.

    • MaxxPayme says:

      very true statements. It just hurts right now – sorry I did not give you the deets eventually I will but it sucks to lose man and it is too fresh right now.

  2. MaxxPayme says:

    ok I’ll say it. I took the wrong trade because I have a bias against the bloated fucking burrito and I let my bias get in the way of the right trade. I shorted CMG and should have shorted GOOG. There, happy?

    Thanks for your comments by the way – I do appreciate the feedback.

    Cheers,
    MP

I love feedback and interaction, any thoughts?

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: