Return chasing

Week 4

Something in your field of view

has gone up more than yours

You opened with

250 units of A at $40.00  =  $10,000
fee                       =      $5

Four weeks later

A  =  $44.00
250 × $44.00  =  $11,000

Up 10%. Fine.

Meanwhile

B:  $10.00  →  $18.00

Up 80%.

So you rotate

sell A at bid $43.96   250 × $43.96  =  $10,990
                              less fee      $5
                                        ───────
                                        $10,985

buy B at ask $18.00    $10,980 / $18  =  610 units
                              plus fee      $5

You also just paid the week 2 round trip again

$20, for the privilege of changing your mind.

What was the evidence?

One sentence. Write it now.

For most people it reduces to

B went up more.

Not that it

sells more of something

costs less relative to what it earns

has customers who cannot easily leave

Recent performance is

a real fact about the past

a weak claim about what happens next

Fill in the counterfactual

Today. Not in April.

If I do nothing today, what happens?

For this example

250 units of A, worth $11,000

No forecast. No reasoning.

The position you would still hold, at a price you can check.

Carry it to week 12

A  =  $46.00        B  =  $14.00

chose:    610 × $14.00  =   $8,540
refused:  250 × $46.00  =  $11,500
                           ─────────
gap                          $2,960

A rose 15%

The market was not the problem.

On the day, that column is evidence

Reconstructed in week 11, it is a story about yourself.

Nobody writes an unflattering one.

Do it today and you have an assignment

Do it in April and you have an anecdote.