Comment on Mr Consistent returning incredible returns

Prateek,

The problem lies within you and not in the strategy (i am not commenting that your strategy is good or bad but the focus of my answer is on the way we think).

You are thinking that you can predict the size and the duration of the rally. In my opinion, both cannot be done consistently. First, you need to understand this basic concept of trading. We are all very good at advanced things in trading.but not in the basics. We are all guilty of this (and guess what, some never get their mind right to understand it..but that’s ok..market is made up of all kinds of people..that’s what make what mkt is)

I don’t know what you have to do to get this concept into your brain..maybe taking a resolution not to watch stock market channels, not reading stock related websites,newspapers and other sources of info..i don’t know..but this gotta be done.

Nowadays, i am seeing this trend emerging in twitter/Facebook (social media is the most popular media now) as well..so, many pundits and wizards trying to ‘predict’ the market. Not sure how they do it. One thing i know about them is they are not sipping pina colada in the beaches of the world..they are still tweeting in twitter and showing their face in TV’s. They know so much about where the market is gonna go and where it will stop and reverse, but still loitering around here..irony, isn’t it?

All we can do is follow where the market goes..In the process, we are gonna lose some money, but that’s perfectly fine. You cannot predict market top and bottom on any timeframe and if you could, definitely not better than a monkey throwing a dart. For sure, forget about figuring out how long the rally (or downfall) will last.

Predicting is analyst’s game not a trader’s game. We all need to be cognizant of that.

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