JOOTSING and Trading

BY COLIBRI TRADER

JOOTSING AND TRADING- a modern approach to having an edge in trading

Ninety percent of everything is crap. According to Sturgeon’s Law (after the science fiction author Ted Sturgeon):

Ninety percent of science fiction is crud. But then ninety percent of everything is crud, and it’s the ten percent that isn’t crud that is important, and the ten percent of science fiction that isn’t crud is as good as or better than anything being written anywhere.

Ninety percent of all traders are losing money (this figure might be even a bit higher). A very small percent of traders are winning traders. Figures from different retails brokers suggest that the ratio of winning to losing traders is anywhere between 5% and 45%, depending on the broker. This means two things- first of all if you are not sure about your trading and want to invest somewhere, retail brokers are a good place to start; secondly- the chances that you will be a losing trader are higher. This statistic is sad but true. On top of that, you will need around 10,000 hours to become really a professional trader. In my trading career, I have only once met a professional trader, who told me that he started making money consistently after only around 3 months of trading. Alas, there is no way I can justify that figure.

Ninety percent of experiments in molecular biology, 90 percent of poetry, 90 percent of philosophy books, 90 percent of peer-reviewed articles in mathematics- is crap. The point I am trying to make here is you’d better not waste your time at the crap. Go after the “good stuff”, or leave it alone- as the philosopher Daniel Dennet says.

So, what does “JOOTSING”stand for and how is it related to trading? JOOTSING is a term collected by D. Hofstadter and stands for “Jumping Out Of The System”. This is an important tactic not just for creative writing, philosophy but also in science and trading. As D. Dennet continues:

Creativity, that ardently sought but only rarely found virtue, often is heretofore unimagined violation of the rules of the system from which it springs. Being creative is not just a matter of casting about for something novel- anybody can do that, since novelty can be found in any random juxtaposition of stuff- but of making that novelty “jump” out of some “system”, a system that has become somewhat established, for good reasons.

In trading “JOOTSING” can be abolishing the bad habits. JOOTSING can also be thought of as a way to be a trend-follower when everybody is trying to pick a top/bottom; or contrarian, when all other traders are an example of herd behaviour. Being able to break the chains of losing trading is taking more time than one can possibly imagine. In my opinion, successful trading starts with a few losing trades; one or more washed tra
ding accounts and hopefully sooner than later, you are on the right way to profitable trading. JOOTSING takes a central part of this process- in essence, this is the tipping point, which props up the scales in your favour. Being able to persist until you get to this point, can be translated into being financially independent and choosing a new holiday destination every month. In fact, the truth is that if you manage to reach this professional trading level, you will probably find trading much more amazing than travelling… but let me not sway away too far away from the topic.

Why JOOTSING should be the approach that you should be after? Let’s imagine that you sit down at a piano and try to come up with a good new melody and you soon discover how hard it is. All the keys are available, in any combination you choose, but until you can find something to lean on, some style or genre to lay down and exploit a bit, before you twist it, you will come up with nothing but noise. Playing the piano could be extremely similar to trading– just like playing a piano, in trading not just any violation of the rules will do the trick. You should learn how to manoeuvre into fields that offer endless number of variations and ways to “JOOTS”.

On the other hand, advising somebody to make progress by jostling is rather like advising an investor to buy low and sell high. Yes, of course, that is the idea, but how do you manage to do it? Everybody knows what more money looks like. When you are confronting a scientific or philosophial problem, the system you need to jump out of is typically so entrenched that it is as invisible as the air you breathe. Just like when you are in a loosing position, it is quite hard to cut your loser fast. It is so obvious that you can’t even realise it- it is invisible.

Being able to “Jump Out Of The System”(JOOTSING) is a new term for an old process that takes place in the human desire to accomplish new highs and reach improved levels of self-consciousness. JOOTSING could be the only way you could be successful in life and particularly in trading- finding a new way to trade, having an edge is what matters in a highly competitive world, where more people than ever are after scarcer resources.