Why Noise Deletion is the Most Important Variable
If you’re reading this, you’re likely looking to improve your trading results. And, there’s also a good chance that you found this and me through Twitter or some other social media platform. So, up front I must first point out, social media is a gigantic trap for many traders. Even if you cast a critical eye towards all of the bullshit that comes your way, it’s impossible for anecdotal observations of crowd behavior to not seap into your own thinking. But, to point out the error of this way just notice how many would be screaming loudly in a large group and it’s always a small minority making most of the noise. This is social media, we usually only hear from the assholes and as those are usually the dumbest opinions to be listening to.
But perhaps more important it’s what social media can lead to that’s the bigger problem and this is going to be a contention regardless of how much time you waste on Twitter or Facebook, and that’s the premise of noise.
Noise is anything that takes up brain space that isn’t helping you. And in a market that’s so incredibly widespread that it can become difficult to even recognize the noise. Business television, market articles and pretty much all commentary is pure noise for most of you (and me, too). It’s necessary, as it’s what gets the public interested in markets and it’s how the world communicated current events and new developments. But, for the person trying to see around the next corner the degree with which the media imparts their own bias is difficult for even the most stubborn thinkers to overcome.
So how do we counter this?
With a plan. And then by instituting the required discipline to follow said plan. Unfortunately, these are two things that most human beings aren’t very good at, especially the discipline part. But if you throw this very natural human complication in with the abundance of noise that’s ever-present and you’ve just created a real quagmire of a situation that’d make it impossible for even a Rhodes scholar to learn how to build a trading approach.
The Long Haul
Anyone that’s actually going to do this for more than a short time is going to need a sustainable model. What’s not sustainable is getting a heart attack every day because of the new flavor of the minute. This then causes you to chase whatever this new fad or trend is with little recognition of the big picture. This is literally waking up in a new world every single day and it’s a disastrous way to live life, much less build a trading account. So – your plan needs to have some controls in place to ensure that you’re not