Tomorrow my wife and I are going to the beach for a few days to celebrate our anniversary, so I won’t be around for the market excitement. It’s tough to miss a few days of market news, especially during the middle of earnings season. Staying up-to-date about what’s going on with all of the stocks you hold is extremely important. As I say in my book, “How can you adapt to changing circumstances if you are not aware that the circumstances have changed?”
However, life doesn’t always cooperate, and there will be times that you will be off the grid for a few days. So am I going to spend my days on the beach worrying about Bank of America’s earnings? Of course not!
There are two reasons that I will be able to relax on my vacation. The first reason is that my investment time-frame is a lot longer than a few days. In other words, barring some catastrophic news that fundamentally changes the future of a company, I don’t really care what a stock’s share price does on a week-to-week basis.
So what happens in that rare case where some catastrophic news does break while I am on vacation? Then I’m covered by my secret weapon: stop loss orders. I wrote a whole post about stop loss orders a few weeks ago. They really are a trader’s best friend. They allow you piece of mind, and they also provide an easy solution for traders that have a hard time staying disciplined about sticking to their plans.
At the end of the day, the key to eliminating stress from your trading is to always be prepared. You never know what will happen on a day-to-day basis, but if you have mentally prepared and planned for all reasonable contingencies, you will never have to make important decisions in real time.
And you’ll be able to enjoy your vacations!
I want to take a minute to thank all the people that bought my book this past weekend while it was on sale. I hope you enjoy reading.
Want to understand how and why technical analysis works? Maybe you don’t believe it does? Or maybe you just want to be able to look sophisticated in front of your coworkers when they ask you what you are reading on your Kindle, and you’d prefer to tell them “Oh, I’m just reading a book about stock market analysis,” rather than the usual “Oh, I’m just looking at pics of my ex-girlfriend on Facebook.” For these reasons and more, check out my book, Beating Wall Street with Common Sense. I don’t have a degree in finance; I have a degree in neuroscience. You don’t have to predict what stocks will do if you can predict what traders will do and be one step ahead of them. I made a 400% return in the stock market over five years using only basic principles of psychology and common sense. Beating Wall Street with Common Sense is now available on Amazon, and tradingcommonsense.com is always available on your local internet!