Caesar or Pompey?
2 sides to every coin, right? 2 sides to every trade-probably. By the way I was not aware of ancient Rome’s civil war either. I like the idea of having your own coin though.
Ok, Back To Trading
Trading should always involve considering your position from the other side. Caesar or Pompey, same idea. What if you had supported Caesar but now saw every reason to be on Pompey’s side? Bad idea but the other way round might have served you well. It’s a simplistic view, but changing sides can be equated to taking the opposite side of the trade. Remember the expression ‘don’t be married to the trade’? Well if not, have a think about that. You may have bought stock in ABC.com but they have not done well as their rivals. XYZ.com have now stolen a march on them. Close out ABC and buy XYZ as the facts have changed. THAT is trading.
Closing Out A Winning Trade
What if your trade has had a great outcome – like Trade 29 here. You’d therefore close out, right? Because you believe the market has run its course. But what if your reason to close out, is the SAME reason for taking the opposite side of the trade? My broker from years ago tried to talk me out of this, on an intra-day trade.
Example
I sold some calls, the market has dropped to a previous support level and it looked like time to close out. Nice outcome again. Why would I NOT at least consider selling the now juicy puts? You are asking yourself to justify your decisions twofold. I am pretty sure very few traders can do this. I’m pretty sure, that for me, it has worked well. And thus to Trade 30
