Traders are always fishing for new ideas and that can lead to trouble, but it can also lead to the discovery of a new lifetime pursuit, the pursuit of comprehensive knowledge. There is a general fear and loathing in trading when it comes to “quote” — thinking too much. We are admonished to keeps things simple and to not muddle our minds with too much, lest we lose our way.
Instead of saying “I don’t trade options because they’re too risky and I don’t understand them” why not say: “let me explain how an Iron Condor is basically a long butterfly with an embedded short box.” Over a nice cup of tea. Yes, that would be better. And let’s not run from technology and the underlying mechanics of how it works.
Yes, I’m talking about programming, every traders love-to-hate topic. There is no glory in being a Luddite during this extraordinary time of technological advancement. The aw-shucks I’m just a stupid trader who makes millions of dollars playing dumb is so passe. That shtick has lost its luster, shall we say.
Don’t cringe when someone says “contango” but teach the definition and the information it contains to your children. Embrace statistics. Learn how bonds are valued. Investigate how central banks influence their currencies and why. Explore how behavioral finance has turned Efficient Market Hypothesis on its head.
It doesn’t hurt to be comprehensive in your knowledge and targeted in your approach. Who knows, you may get hooked on the idea if you try it.