Allowing for Allowance is Allowed

rasha-let-go-and-allow At the urging of Mr. Booker and The Traders Podcast, as well as a shock-and-awe campaign unleashed on my Twitter account that would make H. W. Bush proud, I offer more of my views on the concept of allowance, as introduced in my Don’t Push the River post. In Episode 238, Rob asks if the idea of constant improvement is a myth, and whether or not it gets in the way of achievement.  Oftentimes the result of efforts to constantly improve are seemingly opposite of what is desired.  While the very concept of constant improvement seems counter to allowance, the two coexist and function quite harmoniously together.  I am definitely a “constant improver”, and when I find a way to improve, I allow that improvement to remain constant.  In simpler terms, when I find something that works, I get out of it’s F’ing way.  I do not, ever, try to ‘fix’ or improve it.  It works remember?  The degree to which it (whatever it is) works, is largely irrelevant.

Rob gives an excellent example of a common trader pitfall.  You have an trading system that is profitable, but you really want more trades than it produces.  You set about your efforts to increase the number of trades the system takes, obliterating any profitability the approach had to begin with.  Usually, the whole thing gets tossed out as fast as mucking with it vaporized your equity.  From profitable “trader” to “veteran new guy without a plan”.

Instead, I say this:  If you’ve got a trading system that’s profitable… Wait.  Stop.  Stop right there.  If you have a trading system that’s profitable, then well, you have a trading system that’s profitable.  It works.  Forget how well it works, or how often it works.  Get these irrelevant illusory measurements out of it’s way and allow it to do its thing.  If you’re not satisfied with the number of trades it’s taking, then by all means, go about your search for additional trades; but do it while leaving this thing alone! At the very least it’ll give you some padding as you spend your precious capital on your continuing search for more frequent trades.  Think in addition to, rather than in place of.

Here’s a personal example.  I am a short term trader.  I mean really, really short term trader.  Many of my trades last only seconds.  This is the way I like it.  I like to be out, so I trade on 1 and 5 minute charts.  However, I’ve got a particular setup on the one our chart that I take whenever I see it.  I do so knowing full well that it’s probably going to take a frigging week to play out.  That’s the thing.  It plays out.  Nearly always, it plays out.  In this case, whether I like a trade that lasts a week is irrelevant.  I’ve seen it work enough times, why would I not allow it to make a deposit into my account?  It’s not a matter of do I want to trade the 5 minute or 1 hour chart.  It’s not a question of scalping versus swing trading.  It’s a matter of allowing myself to benefit from something I know works.

Everyone knows I’m a huge proponent of process.  Allowance is definitely not a definable process or procedure, but it’s the final ingredient to any process.  The last step in every procedure.

There’s actually a process for process:

    1. Design the process
    2. Follow the procedure
    3. allow for results

It’s really easy, and only natural for human beings to intervene between steps 2 and 3 of the “Process Process”, in an asinine attempt to elicit results that exceed what is expected or reasonable in accordance with the procedure.

My idea of allowance, is actually an augmentation to a very deliberate approach to life. It is a perspective. I endeavor to have a very specific reason and intent behind every action I take.  Again while this may seem a little bipolar, there is a Yin and a Yang to it, a careful balance.  I take deliberate action, then allow the result to unfold.  What this means is that I don’t worry about too much.  I’ve mixed all the ingredients and I’ve put it in the oven.  The only thing left to do is allow it to bake.  We have much less control over our own existence than we would like to believe.  In other words, while we may have some degree of say in where we travel on the road of life, we are most assuredly NOT in the drivers seat.  Life can be a crusty old cabbie that doesn’t take direction too well at times, so I prefer to just give him a general direction and let him take me for a ride, enjoying the scenery along the way.

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When you accept that you’re not driving, you can take your hands off the wheel, and your eyes off the road.  With a little freedom to look around, you begin to see all kinds of “points of interest” along the way that you were oblivious to before.  It is exploring these opportunities along the way that will lead you out of your comfort zone.  Out here is where all the magic happens, out here is where you’ll allow all sorts of new and fortuitous experiences into your life.

Allow change.  You deserve it.

Change can be a real bitch.  We desperately need it, we’re decidedly terrified of it.  It’s what you seek, and it’s what you run from.  Human beings thrive on change, yet we seek to insulate ourselves from it at ever opportunity.  I am certain that there’s something you’ve wanted for a long, long time, that you don’t have.  Maybe you’re even beginning to give up, to just accept that you’ll never have it, or aren’t meant to, don’t deserve it, aren’t qualified for, etc..

Your actions communicate your intent.  There’s no magical force out there that wants you to fail.  Earl Nightingale points out that we will always gravitate to our dominant thought.  If this dominant thought is wanting, you create more wanting.  Never exiting the state of want, and never recognizing what you have.  Try taking a good hard look at what you’ve got as opposed to what you want.  If you allow, whatever you’ve got tends to grow and change into things you may not even know you want yet.

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10 thoughts on “Allowing for Allowance is Allowed

  1. fxoutlier

    Had to go straight back to the, ”Don’t Push the River,”post which for some reason didn’t resonate with me first time around. Brilliant stuff. I know Rob wants you to write a book, which would be really great, but how about getting together with Shonn, and even invite Rob to fly over, at a quiet time in the cigar shop to discuss this topic,and this time video it, don’t just record it. I really enjoyed the tour video in the diner. Post the video up here and on Rob and Shonn’s sites aswell. Just a thought.

    Reply
  2. Pingback: Allowing for Allowance is Allowed | M o n t e f i d e

  3. Jim

    Matt,
    We in the IT world have PDCA –
    Plan – plan it out no matter what it is.
    Do – follow your plan…you planned it
    Check – is it doing what you planned it to do
    Act – if it isn’t doing what you wanted it to do, then fix what isn’t working and leave the rest.

    Reply
  4. David Clarke

    A wonderful article, and very apt at present!! when taking too many trades, (more than ones system really allows) I find to get back to the nuts and bolts of ones system (after a day or so off) refocuses on this very point! just take the trades you “know” are going to work.
    I agree also that looking for other systems is perhaps the way to satiate the need to trade, whilst of course staying within the framework of that particular system! Thanks to all!

    Reply

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