I sometimes go to Yahoo to find some ideas for topics to comment on at the beginnings of my blogs. Well, since the Packers-Seahawks game the other night, it seems like half the stories have been about the refs and the infamous last play call of the game. I think everyone in the free world has seen the play and commented on it. Even Bill Clinton has come out and put his two cents in. Well, I’m not going to jump on the bandwagon at this point other to make one obvious comment. Stuff Happens. You get what you pay for. Expect the unexpected. Don’t count your chickens before they hatch. All the analogies you have heard. Works for football…sure fire investments…trading…life.
Easy money. That’s what I have been hearing over the last couple of months. For those who have been trading non directional strategies, these have been pretty good times. Markets have been well behaved and vols have for the most part been coming down. But these are the times when I start to get nervous. It’s usually when we are all high-fiving each other, and feeling pretty good about what great traders we are, that things start to go haywire. I’m not suggesting that markets are going to go crazy or things are going to get ugly. Just don’t get complacent. Keep your eyes and mind focused, as always, on the trading rules and risk management. I have a feeling that sometime, over the next few months, we might need to make an adjustment or two. As a money manager, I tell my clients that you make money in markets that behave. I earn my fee when they don’t. Just make sure you “earn your fee” whenever the time comes next. In the meantime, enjoy the environment.