“The people who were right a lot of the time were people who often changed their minds.” – Jeff Bezos
Now what does Jeff Bezos has to do with trading? A lot! He might not trade futures, or day trade Google options, but he is a business man and a speculator, like all of us full time traders, and as you can see from the quote above, he understands and incorporates “stop losses” into his business philosophy.
Jeff Bezos goes on, “Consistency of thought is NOT a particularly positive trait. It’s perfectly healthy — encouraged, even — to have an idea tomorrow that contradicted your idea today, the smartest people are constantly revising their understanding, reconsidering a problem they thought they’d already solved. They’re open to new points of view, new information, new ideas, contradictions, and challenges to their own way of thinking.”
Too many of traders, fall “in-love” with their trades. In communicating with like-minded people (like other gold bugs), they build a circle of “confidence” around themselves. This helps them feel emotionally secure, but they should be looking for holes in their trading ideas instead.
The ability to be open to different points of view know that it is OK to change your mind, i.e. take that stop loss, is CRUCIAL for any business man, as well as any trader. Take Jeff Bezos advice and run your trading business accordingly.