How to play in the CURRENT MARKET situations? Traders Guide

Tuesday, 04 December 2018

How to play in the CURRENT MARKET situations? Traders Guide

Greetings from Hitesh! Many guys when they come to the market – they have confidence on their logical faculties that they will be able to understand the market with their intellect. The guys who have come in the market post 2009, have seen one side teji and these are the guys who talk about market more confidently then the guys who have been in this market for 20 or more years. They feel that LOGIC is the main element and you can decode the market with the LOGIC.

Many MBA’s have been brain washed with the PERFECT MARKET THEORY and they will die to prove that. Let us meet one such guy and understand the market.

A friend has forwarded a beautiful story and I am just using the same to bring home the point.

STORY OF LOGIC V/S. REALITY

A young man in his mid-twenties knocks on the door of a renowned Guru. He says: “I’ve come to you because I wish to study Vedas.”

“Do you know Sanskrit?” the Guru asks.

“No,” replies the young man.

“Have you studied any Indian philosophy?”

“No. But don’t worry. I just finished my doctoral dissertation at Harvard on logic. So now, I would just like to round out my education with a little study of the Vedas.”

“I doubt,” the Guru says, “that you are ready to study Vedas. It is the deepest knowledge ever known. If you wish, however, I am willing to examine you in logic, and if you pass that test I will teach you Vedas.”

The young man agrees.

Guru holds up two fingers. “Two men come down a chimney. One comes out with a clean face; the other comes out with a dirty face. Which one washes his face?”

The young man stares at the Guru. “Is that really a test in logic?”

The Guru nods.

“The one with the dirty face washes his face”- he answers confidently.

“Wrong. The one with the clean face washes his face. Examine the logic. The one with the dirty face looks at the one with the clean face and thinks his face is clean. The one with the clean face looks at the one with the dirty face and thinks his face is dirty. So, the one with the clean face washes his face.”

“Very clever,” the young man says. “Give me another test.”

The Guru again holds up two fingers. “Two men come down a chimney. One comes out with a clean face, the other comes out with a dirty face. Which one washes his face?”

“We have already established that. The one with the clean face washes his face.”

“Wrong. Each one washes his face. Examine the logic. The one with the dirty face looks at the one with the clean face and thinks his face is clean. The one with the clean face looks at the one with the dirty face and thinks his face is dirty. So, the one with the clean face washes his face. When the one with the dirty face sees the one with the clean face wash his face, he also washes his face. So, each one washes his face.”

“I didn’t think of that,” says the young man. It’s shocking to me that I could make an error in logic. Test me again.”

The Guru holds up two fingers. “Two men come down a chimney. One comes out with a clean face; the other comes out with a dirty face. Which one washes his face?”

“Each one washes his face.”

“Wrong. Neither one washes his face. Examine the logic. The one with the dirty face looks at the one with the clean face and thinks his face is clean. The one with the clean face looks at the one with the dirty face and thinks his face is dirty. But when the one with the clean face sees the one with the dirty face doesn’t wash his face, he also doesn’t wash his face. So, neither one washes his face.”

The young man is desperate. “I am qualified to study Vedas. Please give me one more test.”

He groans, though, when the Guru lifts two fingers. “Two men come down a chimney. One comes out with a clean face; the other comes out with a dirty face. Which one washes his face?”

“Neither one washes his face.”

“Wrong. Do you now see why logic is an insufficient basis for studying Vedas? Tell me, how is it possible for two men to come down the same chimney, and for one to come out with a clean face and the other with a dirty face? Don’t you see? The whole question is nonsense, foolishness, and if you spend your whole life trying to answer foolish questions, all your answers will be foolish, too.”

Do you TRY to understand the MARKET with LOGIC like YOUNG MAN?

Market is collective emotions. It has nothing to do with logic. It has to do with feelings. Feelings when looked backward – can be put in the form of logic and it creates an illusion of logical analyses.

The best way to understand market is to understand your EMOTIONS as deeply as possible. You need to find out the sources of your emotions and how that emotions makes you do what you do. Unless you use your emotions, your emotions will use you and you will be finished in the market.

Once you master your own emotions, automatically you will find that you understand the market easily.  

To understand your emotions properly, you need to put as many trades as possible – start with small trades where you can afford the losses – and be present to your MIND TALK.

Thanks to super EMOTIONAL stability – seasoned investors buy shares when everything is apparently negative. Recently, RAKESH added shares of DHFL when the shares was down by more that 50%. This can’t be explained with LOGIC. This has to do with the EMOTIONAL BALANCE.

What NEXT?

We help our investor to master EMOTIONS while trading or investing. If you really want to be successful in the market – you will need more than just a TIP. We are preparing our client for HOLISTIC success. If you like our approach, please be with us.

HAVE A HAPPY TRADING.

Follow me on Twitter @hiteshmparikh / WhatsApp - +91-9869425399.

Live With Passion…Invest With Passion.

Hitesh Parikh.