How to Handle a Lost Trading Opportunity

A week ago I wrote a column entitled “Sell Today and Go Away“. In it I described my reasoning for taking off my trading positions ahead of a vacation I took at the end of last week. For those keeping score at home, the S&P500 is now roughly 5% higher than it was before I made my unforced trading error. Selling off my trading longs (I didn’t and don’t have any shorts), became what’s called a lost opportunity. My desire to chug a bottle of Hemlock is what’s called trader’s remorse.

Which brings us today’s Purple Crayon Segment: How to Handle a Lost Trading Opportunity. There are three very basic steps:

Step 1: Kick yourself. Seriously. Here’s an example straight from my internal monologue: “You are an idiot. You had money in your hand and you cast it into the wind so you could tan your bald head on some beach. Well done, meathead.”

Step 2: Get over it. Or drink the Hemlock. Living in regret is for chumps.

Step 3: Get back to work with a clear mind.

That’s pretty much it. I’m over the missed trade; it’s time to go back to work.

Wednesday, August 31st, 2011 Education, Evergreen

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