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CHAPTER
29
Operating on All Cylinders
I believe intuition is the sum total of all the stimuli that traders
receive in an instant or over time and also the sum total of all
their experience in the market.
—Howard Abell, The Inner Game of Trading (Irwin 1993)In business, only intuition can protect you against the most dan-
gerous individual of all—the articulate incompetent.
—Robert Bernstein, Chairman, Random HouseIs intuition useful?
I believe that using intuition as an equal partner with logic is
the single greatest strategy that money managers can employ. There,
I said it. Like the Christians who were thrown to the four-legged
lions, I have thrown myself before the two-legged lions who rule
the major investment firms and run the markets. I can almost hear,
from my office window, the sound of books slamming closed as
lion investors read these sentences and exclaim, “Crackpot!”
Okay. I understand why lions would react that way. Lions rely
heavily on the information that they receive from their five senses.
They trust the “real” world, that which we can see and hear. They
trust measurable results. They trust their experience. They trust
things that they can understand. Herein lies the problem. Intuition,26-29 ware 241 1/19/01, 1:19 PM