Brett Steenbarger PH.D Locked How To Fail Successfully
If you're going to be a skillful sailor, you have to weather some storms. We build and expand skills by testing them, and that means that failure is an essential ingredient of success. It's the weight that we lift for one set of repetitions but not three that we should be tackling in the gym. After we succeed at one weight, we seek the next weight that will ensure our failure.
That opened the door to a simple recognition: the patterns that are profitable are a function of where we're at in a market cycle. In topping and bottoming phases, markets display mean reversion. In rising and falling phases, markets display momentum.
The successful trader adapts to market cycles. Imposing our trading style on markets is a formula for guaranteed drawdown and frustration.