Wine and Trading

June 23, 2017

The soil matters most.

Without great soil, wineries cannot make great wine. Without big trends, traders cannot make big money. Wine-makers are at the mercy of their geographical location; traders, at the mercy of the markets. There’s a reason why wineries don’t exist in Nebraska and why trend traders don’t make money in stagnant markets.

Much of what contributes to making great wine lies outside of our control – location, soil and weather. If a guy in Iowa wants to open a winery, he knows he has to go to where grapes grow. He cannot force the issue in Iowa. He’s simply in the wrong place to make wine. This says nothing about his talent, will or hustle. He just has to adapt to the reality that running a successful winery cannot be done in Iowa. He’s gotta move.

In trading, we depend on trends to make money. Long-term traders, like myself, need months of price persistence to produce a profit. Outside of stocks, markets have been fairly stagnant for the last couple of years. Like a winery, a large part of what we need to succeed lies outside of our control. I have no control over what markets do and there’s nothing I can do to change them. I simply have to wait it out until the soil (markets) become more fertile.

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