c05 JWBT016-Busby September 30, 2008 13:49 Printer: Yet to come
CHAPTER 5 The Art of Trading
“
N
othing endures but change.” When ancient Greece thrived, Heracli-
tus developed his philosophies about the universe and the central
role of change to it. He understood that change is one aspect of life
that is predictable and certain. That is, over time nothing earthly remains
the same. The rule clearly applies to financial markets. They are dynamic
and challenging. Every day brings new developments and new difficulties.
Bull and bear markets come and go, and successful traders must accept
that reality and deal with it effectively.
Trading is an art and not a science—that is why it is so challenging
and downright difficult. Winning traders must constantly measure, gauge,
compare, and evaluate. The financial markets are vibrant. By their very
nature they are continuously in a state of flux. Therefore, winning traders
must adapt and change with them. Winners must also continue to educate
themselves and learn new strategies, new techniques, and new approaches.
There is no simple rule to follow or program to execute that will always
return a profit. Many traders look for a system or a program that will take
the risk out of trading. If you don’t already know, let me be the first one to
tell you that those systems do not work. They may do well in a bull market,
but when consumers lose confidence in the economy and stock prices fall,
the system is no longer effective. Or they may do well in some sectors, but
may not work if applied to others. No system has the ability to analyze and
react to markets that are always rising and falling and affected by an array
of economic and political factors.