{"id":13736,"date":"2019-05-29T07:30:13","date_gmt":"2019-05-29T11:30:13","guid":{"rendered":"https:\/\/www.jeffclarktrader.com\/?p=13736"},"modified":"2019-05-29T07:30:13","modified_gmt":"2019-05-29T11:30:13","slug":"the-secret-to-longevity-as-a-trader","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/the-secret-to-longevity-as-a-trader\/","title":{"rendered":"The Secret to Longevity as a Trader"},"content":{"rendered":"

Imagine you’re a contestant on the game show Let’s Make a Deal<\/em>.<\/p>\n

Monty Hall pulls you out of the audience. He waves $2,000 in your face and says, “This is your money. You can take it and keep it right now, or you can trade it for what’s behind the curtain.”<\/p>\n

Of course, you know from a lifetime of watching daytime television that there’s a 50% chance that what’s behind the curtain is an all-expenses-paid trip to Mazatlán – valued at $5,000 – and a 50% chance that it’s something virtually worthless, like a farm animal.<\/p>\n

What do you do?<\/p>\n

If it’s me… I’m taking the cash.<\/p>\n

I’m thinking, “I came here with nothing. There’s a 100% chance I’ll leave here better off if I take the money. There’s only a 50% chance I’ll leave here happy if I take what’s behind the curtain. Either way… my life isn’t going to change dramatically. So I’ll take the $2,000 and be happy no matter what.”<\/p>\n

Here’s another line of thought…<\/p>\n

“I came here with nothing. The worst case is I’ll leave here with nothing. But there’s a 50% chance to increase the return on my prize by 150%. The odds justify that trade. So I’ll pick what’s behind the curtain.”<\/p>\n

Here’s the thing… there’s nothing wrong with either decision. All that matters is how you view the consequences of the trade.<\/p>\n

Let me explain…<\/p>\n

I’m going to be happy if I get a $2,000 windfall profit. I might be slightly more ecstatic if I win a trip valued at $5,000. But I’ll feel like an idiot if I give up the $2,000 and go home with a goat.<\/p>\n

So I’ll pass on “ecstatic.” I’ll take “happy.”<\/p>\n

Not everyone thinks that way – which is why we love watching game shows.<\/p>\n

Let’s apply this thought process to the stock market…<\/p>\n

Every time I close a trade, in the back of my mind, a little voice asks, “What happens if it moves even higher?”<\/p>\n

This is the equivalent of Monty Hall asking if I want to keep the $2,000 or trade it for what’s behind the curtain.<\/p>\n

I know for sure that I’m happy if I close the trade right now. I don’t know if I’ll be happier or feel like an idiot later.<\/p>\n

So I almost always chose to err on the side of happiness.<\/p>\n

Now… if this is your only time on a game show… if it’s your only chance to make a trade in front of Monty Hall, it’s understandable if you choose what’s behind the curtain.<\/p>\n

After all, it’s your only shot to maximize your gains.<\/p>\n

I get it.<\/p>\n

But the stock market isn’t a game show. We have trading opportunities almost every single day. The secret to longevity as a trader is to consistently take the money when it’s flashed in front of you.<\/p>\n

You might feel a tinge of disappointment if a trip to Mazatlán is behind the curtain. But you’re still heading home with more money than you had before.<\/p>\n

Be happy. At least you’re not going home with a goat.<\/p>\n

Best regards and good trading,<\/p>\n

<\/p>\n

Jeff Clark<\/p>\n

Reader Mailbag<\/strong><\/h2>\n

In today’s mailbag, readers weigh in on Jeff’s prediction<\/a> about a stock market crash…<\/p>\n

\n

I kind of hope you are right. I watched your presentation but never deal in stocks. I am a bullion person, and debt free, so I will be set for what is coming. We will all lose if it gets as bad as I believe… Good luck<\/p>\n

– James<\/strong><\/p>\n<\/blockquote>\n

\n

Thank you very much for your presentation, I truly appreciated it. I wanted to know, from a reliable source, just when to expect the impending crash. I think you are probably correct… October has always been a rocky month in the financial world, from my experience.<\/p>\n

I do have about 70% of my money in cash term deposits, 20% in gold and silver bullion, 5% in crypto…<\/p>\n

I did, at one time, think of going into U.S. stocks, but because of the time zone, the exchange rate, and dealing with Australian taxes, it was all too much of a hassle for me in the end. I’m over 70 and need to ensure I can help my family in the near future with what I have.<\/p>\n

Now, with your information which you generously shared, I feel I can make a plan out of the bank’s reach. Thank you again.<\/p>\n

– Olivia<\/strong><\/p>\n<\/blockquote>\n

Was there a time when you decided to take the profits on a trade, instead of waiting to see what might happen next? Have you ever taken home “the goat”?<\/p>\n

Let us know about your trading stories, along with any other questions or suggestions, at feedback@jeffclarktrader.com<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Imagine you\u2019re a contestant on the game show Let\u2019s Make a Deal…<\/p>\n","protected":false},"author":37,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[7],"newsletter-type":[],"ticker":[],"class_list":["post-13736","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-jeff-clark"],"acf":[],"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/13736","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/37"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=13736"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/13736\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=13736"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=13736"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=13736"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=13736"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=13736"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=13736"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=13736"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}