Stock Trading Should Be Like Blackjack

The markets are taking a breather after a nice first quarter sprint. For some reason, I thought about blackjack. I can’t say I’m a pro, but for the most part, I can play with my emotions in check. How is that possible when I’m one of the most emotional guys around? There are rules to playing 21.

What ever your trading philosophy or indicators you follow, if you unemotionally trade following your investing rules, you will be fine regardless of the outcome. The dealer has a picture card, you hit. The dealer has a small card showing, you have eleven, you can double down. The dealer has a small card and you have a high pair, you can split them. Even if you lose the hand, at least you played your hand the right way. We should all apply this thinking to our stock trades no matter if we follow charts, follow through days, or CANSLIM, just to name a few.

Final Thoughts

You can’t win them all, but if you successfully keep your emotions in check, it won’t matter that you took a small haircut or left some money on the table. In the long run, you should be a more successful trader because you traded the right way, weren’t emotionally swayed by your last hand, and you don’t sweat greed or fear. It just wasn’t in the cards.

Stay Inspired!

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9 Responses

  1. krantcents says:

    I think I heard a similar philosophy of dating your stocks, but not marrying them somewhere. I think it helps to have a plan when you buy and when you will sell.

  2. Dicken says:

    I agree with you. Trading stocks should be done like counting cards (which is the technique used by the characters in the book and its film adaptation) we base our actions on how the market is acting.

  3. The hardest part of investing is keeping your emotions in check. Sometimes, it’s just easier to turn the monitor off and check back in the autumn. Of course, you will be able to afford this if you’re indexed.

  4. Having a plan and keeping emotions at bay are vital–nobody can accurately time the market even if they do manage some short-term successes!

  5. Great points. Maybe my lack of emotions is what helps me in both blackjack and trading stocks (I do enjoy blackjack in real life…lol).

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