Trading is a business – It is not an investigating agency

Business TV keeps on asking this question why did it happen? Then, a range of experts are brought in to provide answers – the questions and answers are nothing to do with trading.

An interesting article discusses the stress of trying to find out why something happened: Read it Here.

Lines inside quotes are from the article mentioned in the link above.

“As an investor, my objective is not the pursuit of intellectual wealth –my objective is that of financial wealth.  Get that straight! ”

Surely, sometimes our job is to follow the market, sometimes anticipate price movements, but always to go with market flow.

If the Nifty rises 200 points, Media provides many reasons why it went up. But how does this help traders? Traders have to identify the rise as it begins. Once the rally is complete, there is no buying opportunity, therefore, the reasons for the rally become  immaterial.

“With hindsight, I may eventually learn why an equity turned bullish or bearish, but that knowledge is just academically interesting.”

“Believe in what your charts are telling you, and then focus on trading the “now” – it will free you from a lot of stress.  ”

Reasons for a move are found after the move has already come about. While it is good for TV, it is meaningless for a trader or investor.

We are in the business of trading for financial gains. We are not in the detective agency business, trying to find out what an event happened..