Why Is The Obvious Not So Obvious?

Discussion in 'Risk Management' started by nysestocks, Jan 25, 2009.

  1. J Ski

    J Ski

    Long term follower of this thread. Recently decided to begin reading from the beginning, again. Unfortunately several of the charts can longer be accessed.
     
    #8601     Sep 3, 2024
  2. Ed48

    Ed48

    FWIW, here are my takeaways from this thread.

    1) Trading is gambling. It took me a long time to accept this because everything I'd previously been exposed to (books, articles, forums), and conditioned to believe, portrayed trading as something more scientific/technical with rules, rather than just a game of chance.
    2) The best you can do is try and put the odds in your favour.
    3) You take a long position when price is more likely to go up. You take a short position when price is more likely to go down.
    4) But you always accept it's just a gamble, which may or may not pay off.
    5) Position sizing and risk management are just to stop you losing money too quickly.

    Figuring out 3 is the challenge but without it you won't make good money.
     
    #8602     Sep 4, 2024
    Sekiyo likes this.
  3. schizo

    schizo

    If you haven't figured it out by now, it's of no use is what I assume the OP would think. :)

    BTW the OP wanted to hear something apparently obvious that's not so obvious to everyone else. But your examples are just obvious.
     
    #8603     Sep 4, 2024
  4. Ed48

    Ed48

    They can't be that obvious if you look at the way most people trade; relying on indicators, patterns, waves and other BS, and thinking that money management is the key to success.
     
    #8604     Sep 4, 2024
    Sekiyo and themickey like this.
  5. schizo

    schizo

    Then it wouldn't just be GAMBLING, as you seem to want us to believe.
     
    #8605     Sep 4, 2024
  6. Sekiyo

    Sekiyo

    Gambling isn’t throwing money away. You can gamble with an edge. There are professional gamblers.

    It’s all about odds and likelihood.
     
    #8606     Sep 4, 2024
  7. schizo

    schizo

    Again, who doesn't already know that? Hence why I wrote earlier that what he wrote was not the "obivous" that the OP was looking for but just another plain vanilla obvious.
     
    #8607     Sep 4, 2024
    Sekiyo likes this.
  8. Sekiyo

    Sekiyo

    I don’t know who’s the OP but often the obvious doesn’t look obvious because of this

    upload_2024-9-4_22-18-1.png

    It’s about removing.
    Removing greed, fear, uselessness …

    I think most of us already have the answers,
    That’s why we repeat ourselves.

    Nothing’s new under the sun.
     
    Last edited: Sep 4, 2024
    #8608     Sep 4, 2024
  9. Sekiyo

    Sekiyo

    Why people complicate ?

    People often complicate things for a variety of reasons, some of which are intentional, while others are more subconscious or situational. Here are some key reasons why people complicate:

    1. Fear of Failure or Uncertainty

    • Overthinking: People may complicate decisions or tasks because they are afraid of making the wrong choice or failing. By overanalyzing, they hope to avoid mistakes, even though it can lead to paralysis by analysis.
    • Perfectionism: The desire for perfection can cause individuals to overcomplicate processes in an attempt to cover every possible outcome or detail.
    2. Lack of Clarity

    • Unclear Goals: Without a clear objective or understanding of what needs to be done, people might complicate things by pursuing unnecessary or irrelevant steps.
    • Information Overload: In today's world, with so much information available, people can feel overwhelmed and complicate their thinking as they try to process everything at once.
    3. Desire to Appear Knowledgeable or Competent

    • Impressing Others: Some people might overcomplicate explanations or tasks to appear more knowledgeable or skilled, believing that complexity is a sign of intelligence or competence.
    • Defensive Behavior: Insecurity about one's abilities can lead to unnecessary complexity as a way to hide potential gaps in knowledge.
    4. Avoidance or Procrastination

    • Avoiding Decisions: When people are reluctant to make a decision or take action, they might complicate the situation as a way of delaying or avoiding the inevitable.
    • Procrastination: Complicating tasks can be a form of procrastination, where people create obstacles to avoid getting started or completing a job.
    5. Social and Cultural Factors

    • Group Dynamics: In groups, decisions can become more complicated due to differing opinions, politics, or the need to reach consensus, leading to more layers of discussion and negotiation.
    • Cultural Norms: In some cultures or industries, complexity is valued, and simple solutions might be seen as too simplistic or inadequate.
    6. Psychological Patterns

    • Cognitive Biases: People have natural tendencies to see patterns or connections that may not exist, leading them to overcomplicate situations.
    • Habitual Thinking: Some individuals have a tendency to complicate things because they are accustomed to thinking in complex ways, possibly due to past experiences or personal traits.
    7. External Pressure

    • Expectations: External expectations, whether from society, family, or work, can cause people to complicate things in order to meet perceived standards or expectations.
    • Unnecessary Requirements: Bureaucracy and unnecessary regulations can add layers of complexity to tasks that might otherwise be straightforward.
    In many cases, complexity arises from a mix of these factors, making it important to be mindful of when and why we might be complicating things and to seek simplicity whenever possible.
     
    #8609     Sep 4, 2024
    baron193 likes this.
  10. Ed48

    Ed48

    If you read the first sentence of my original post, I never claimed to be revealing "the obvious". I just said these were my takeaways from this thread.

    However, I would still maintain that it's not obvious to most that trading is gambling, otherwise they wouldn't be doing what they are doing.

    The obvious is how you gamble; how you put the odds in your favour. But that's for people to figure out for themselves.
     
    Last edited: Sep 5, 2024
    #8610     Sep 5, 2024