Missing the Move Beats Getting Your Face Ripped Off
Markets move on. These ideas don’t.
Three themes worth adding to your process.
Balance Matters More Than Conviction
Want to get yourself into trouble? It’s easy to do. Just get emotionally attached to what’s happening right now.
When stocks are running higher every day, it’s tempting to believe the move will never end. When the market stumbles, it’s equally tempting to assume something has fundamentally broken. Neither reaction is particularly useful.
The goal isn’t to become emotionless. The goal is to maintain enough balance that you can continue making good decisions while everyone else is reacting to the latest headline.
Markets, like life, tend to move in waves. There are periods when everything feels easy and periods when nothing seems to work. If you allow yourself to become overly optimistic during the good stretches, you’ll often take unnecessary risks. If you become overly pessimistic during the difficult stretches, you’ll often miss opportunities that are beginning to develop.
That’s why process matters.
When things are going well, process keeps you from becoming reckless. When things are going poorly, process keeps you from becoming fearful.
Balance isn’t about avoiding emotions.
It’s about making sure emotions don’t take control of the steering wheel.
Keeping an Open Mind Is a Skill
One of the most expensive mistakes investors make is deciding too early what is possible.
The market has a habit of doing things that seem unlikely, inconvenient, or outright ridiculous. It doesn’t care whether a move fits the prevailing narrative. It doesn’t care whether experts agree with it. It only cares about supply, demand, and the willingness of participants to act.
That’s why keeping an open mind is such an underrated skill.
Not because every possibility deserves equal weight, but because extraordinary outcomes almost always look improbable before they happen.
Many investors spend so much time defending their existing views that they fail to recognize when conditions are changing. By the time they accept the new reality, much of the opportunity has already passed.
You don’t have to predict every possibility.
You simply have to remain open enough to recognize one when it arrives.
The market rewards flexibility far more often than stubbornness.
Missing Out Is Not the Same Thing as Losing
The market sells off hard and you decide not to buy in the hole. The next morning it gaps higher, and suddenly it feels as though you’ve made a mistake. You didn’t catch the move. You missed it.
Maybe.
But that’s not the only thing that could have happened.
At the close the previous day, there were three choices available. You could buy, you could sell short, or you could do nothing. Once the market gaps higher the next morning, most people compare themselves to the trader who bought the low and immediately conclude they made the wrong decision.
What they ignore is the trader who got bearish at exactly the wrong moment.
Not buying may have cost you an opportunity. Going short would have cost you money.
Those are not the same thing.
One of the easiest ways to become frustrated in the market is to compare your decision to the single best outcome that was available in hindsight. A better exercise is to compare it to all of the outcomes that were possible at the time.
Sometimes you miss a rally. Sometimes you avoid a disaster.
And every now and then, those turn out to be the exact same trade.
This is the thinking.
The Full Daily Update is where ideas become action—best setups, best odds, least risk.
All opinions expressed in The Lund Loop are my own personal opinions and don’t reflect the views of my employer, any associated entities, or other organizations I’m associated with.
Nothing written, expressed, or implied here should be looked at as investment advice or an admonition to buy, sell, or trade any security or financial instrument. As always, do your own diligence.