Travel. Who doesn’t like a good old trip to some faraway land? Just don’t drink the water. When you travel, do you keep a journal or do you just take pictures (please, no selfie sticks)? I fall in the latter camp, but I used to keep journals when I was younger. Speaking of keeping journals, all those famous dead explorers that we’ve all studied always kept a journal. Well, they at least had a point man on every voyage who’s objective was to keep a journal. Take Magellan, for example. He didn’t quite make it back to Portugal after circumnavigating the world in 1520, but his “log man” did. This was the key source behind the book, Over the Edge of the World: Magellan’s Terrifying Circumnavigation of the Globe, which I highly recommend.
How does this relate to trading? I’m sure Magellan would’ve traded options if he had wifi, probably the Road Trip trade. Here’s what I find interesting. We all have a different way of telling where we have been. This relates to our trading journals. Personally, I keep mine in excel. I find it easier to track. My father, on the other hand, prefers to do it “old school”. He uses a $1.99 notebook (see above photo). If you look carefully you’ll see the paper clips on the bottom right of the photo. We are talking cutting edge technology here. The paper clips essentially mean trouble. They represent past trades that are still in play that need repair (ie. assigned a put or call). Some people look at the beta-weighted delta number of their portfolio to SPY as a gauge to their market exposure. He looks at the number of paper clips in his notebook.
Which way is better? That is something you’ll have to decide yourself. The main takeaway is that you keep a journal. One more thing, if you ever find yourself looking to anchor your ship near a land full of cannibals, you might want to reconsider. You will need a lot more than paper clips!
Here’s a video regarding “The Captain’s Hat”, enjoy:
Written and contributed by John Wilson