Feet on the ground

So while I was away I had lots of opportunity to reflect on the last 18 months or so. My trading, the blog and my results. It felt good to dwell on it all. Afterall, I turned £1k into nearly £35k through what I considered pretty risk averse trading strategies. I exceeded my expectations. And as a result I not only paid for my wedding and honeymoon but now have a useful lump of cash at my disposal. Of course that is going to feel good.

However, gnawing away at the back of mind though was the thought that I'm now at my most vulnerable. I achieved what I set out to do. The target is gone. And with it perhaps the discipline that enabled me to succeed. While keeping the blog, as the monthly results started to add up, I was always painfully aware that I musn't let the success go to my head. Musn't let anything slip. I kept telling myself that I hadn't cracked it. That I was still learning the trading game. Still making mistakes. And still coming across new situations. I was forever telling myself to stay focussed, stick to my trading guidelines and never take anything for granted. If I need a reminder why it's so important to keep all this in mind it's sat there in black and white. My biggest loss since starting the blog was just a few trading days before I got married.

Anyway, the point is this. As I was mulling all this over I was rereading a book about the life of legendary Wall Street speculator Jesse Livermore. A guy who won and lost hundreds of millions of dollars before his suicide in 1940. Suddenly I came across a passage which just seemed to perfectly encapsulate the thoughts I was having.

Livermore was talking about a time he had just gone broke in 1908 after losing millions of dollars getting on the wrong side of the price of cotton. Reflecting on his catastrophic losses he was philosophical saying:

"I sometimes think that no price is too high for a speculator to pay to learn that which will keep him from getting the swelled head.

"A great many smashes by brilliant men can be traced directly to the swelled head - an expensive disease everywhere to everybody, but particularly in Wall Street to a speculator."

Well, change Wall Street to Betting Exchanges and it's brilliant. As relevant today as it was then and perfectly summing up my fears. A timely reminder from a legendary trader to keep a level head as I prepare to enter the markets again.

So that's exactly what I aim to do. Keep my feet on the ground. And my head clear and focussed. To that end I'll be dipping into the markets rather than plunging straight back in. Get used to them again before I commit too much money. The Twenty20 World Cup isn't perhaps the best event to do this with but hopefully within a few days I'll start to get back into the swing of it. Time permitting I may even start with this afternoon's Pro40 match between Middlesex and Derbyshire. Be nice to start with a win again. But, as ever, I'll always be willing to take a loss.