About a year ago I wrote a blog on the "silly season," as I call it. The silly season starts on December 15 and extends through the first week of January. The silly season has nothing to do with telling jokes and laughing at funny things, but everything to do with trading.
Trading is a serious business. If you want to be successful you have to practice, just like an athlete would. I don't think there is an athlete out there who just woke up and said I'm going to be a world-class athlete and achieved that goal without practicing.
After December 15 most successful traders who made their money during the year are headed to either Florida, Palm Springs, or just taking a break to spend time with family.
What makes the silly season, silly?
It has everything to do with the lack of volume in trading. When you have very little volume it is easy for markets to be, forgive me because I am about to say the M word - manipulated - by just a few traders. You do not want to be ending your year at the mercy of markets that are erratic at best. You may as well just head out to Las Vegas and take a shot at the roulette wheel.
So how can you avoid this trading trap? Here's what I do every year:
After the 15th I close out all of my positions win, lose, or draw, and say thank you very much for another good year. Once I have cleared my trading book I'm free to enjoy the silly season without falling prey to the big M. I let the markets be the markets, because I know that they will be there next year and I want to be prepared physically and mentally to take advantage of them.
That being said, here are my five key recommendations for you during silly season:
* Enjoy time with your family and friends.
* Be appreciative what you have, not what you don't have. There are a lot more folks that have a whole lot less than you than folks who have more.
* Give something back. It doesn't matter what it is, or how small, give something back; it will make you feel good.
* Enjoy the season. Forget about the markets they will be there next year.
* Take some quiet time for yourself to regenerate your spirit.
For me, number 5 means sitting in a quiet room by myself and thinking about all of the different things that have happened in the past year. Doing this keeps me grounded and prepares me for the year ahead. This quiet time helps me put everything into perspective and gets me in the right frame of mind for trading in the New Year. This quiet time restores your inner strength, which is something you need in trading.
So there you have it. That is how I avoid silly season and prepare myself for the new trading year.
I welcome your feedback. Why not share how you get ready for the new trading year.
Here's to a great silly season!
All the Best,
President of INO.com
Co-Founder of MarketClub