Checks and Balances

NATURAL EXTENSION - There's no hiding the fact that I'm a contrarian trader. I think all of you know that full well by now. But why is that? What is it that makes me a contrarian trader? I've said in the past that the type of trading style one adopts need to be complementary to who they are as an individual. I find that I have always been the type of person who tends to move against the grain and so the contrarian methodology is nothing more than an extension of who I am as a person, which means it comes natural to me. When you trade, you need things to be as much in your favor as possible and doing things that are more comfortable definitely helps, assuming of course that it works. 

CLIMATE CONTROL - Another reason I like being a contrarian is that it allows me to find trades that haven't happened yet. I am in fact doing the very opposite of what most would tell me is the sensible thing. I am selling when the market looks like it can only go higher and I am buying when it looks like we are in a freefall. So I suppose, there is some gratification in taking positions where you are anticipating the winds of change in an extremely challenging climate. And it's by design that I analogize this to weather control as you are stepping into a storm and trying your best to battle against it at its most intense moment. So I think there is something cool about that. Making money with the trend isn't easy but it is a lot less exciting to me. 

Contrarian trading serves a vital role in financial markets. Via @joelkruger

NECESSARY ROLE - One other important point about contrarians that I think is overlooked quite a bit, is that contrarians are ironically the voice of reason and calm when things get out of control. Contrarians are often thought to be wild, loose cannons that are disruptive. And while all of that may be true, the disruptions caused by contrarians are necessary disruptions that try to restore order to markets that have gone off the rails. Contrarians provide the necessary checks and balances to the market that allow it to move in a way that makes it attractive to all those who participate in the business of trading markets. I suppose with that said, it also feels good to be going against the trend as I am playing an important role in making sure markets stay honest. And ya, I also like making money! :)

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