The markets are particularly difficult to predict right now. Short term trading is essentially making a bet on what the market is going to do over a specific period of time. Being a short term trader (I do not like to call myself a day trader, but my trades are usually completed in a day – often much less) I pay close attention to time. Even the time of day is important in my trading.

Recently I came up with an idea of why time is so difficult to predict. It was so obvious when I realized it that I could not help but wonder why it took me so long to see it. Just goes to show you that early lessons in life can be hard to overcome unless you pay attention.

Seems like the problem started long ago when our ancestors started calling time, Father. Probably about the same time they started calling nature, Mother. Father Time and Mother Nature were a big part of my early learning experience. And it was reinforced by the media referring to Mother Nature frequently and to Father Time, at least every New Year.

So what’s the problem? In my considered opinion nature is more predictable than time. Actually, nature is quite predictable. Look at your local weather forecasts – they have gotten extremely accurate over the last few years. Usually, when they are off a bit it is a matter of time, not condition itself.

Time on the other hand is totally unpredictable. So I got to thinking, what’s the real difference in time and nature as far as predictability is concerned? My conclusion was not hard to reach. Nature is more predictable because it mainly consists of repetitions of the generally same events – with the same elements often at work.

Time on the other hand is never repeated. Every moment in time is a unique event and can never be repeated. Do not bring up the fact that the same thing happens over and over again. That is a recurring event – the moment in time in which it occurs only happens once and can never occur again. An event may or may not recur. A moment in time can never recur.

Well now, that is interesting – but what the hell does it mean to a trader? If you expect a complete answer here you are going to be disappointed – I could probably write a book on the subject – likely a very long book.

However, I will say this without reservation. Time is why I am a short term trader. Because time is so totally unpredictable, the more time a trade is live the more opportunity for an unexpected event to effect the trade. And there is about a fifty-fifty chance that the event will affect the trade adversely.

Good security traders try to avoid fifty-fifty situations whenever possible. That is swapping dollars and with spreads to cover usually results in losses.

Time – everyone has some – few, if any of us ever has all we want. And what little of it we have can only be used once.

Enjoy each moment – it is unique – and can never be repeated.

Enjoy the moment.

 

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