macrocephalopod

10/ I’m saying you should. Another way to think of it is like this: I have some private information, some signal, that tells me the price should be different (either higher or lower). The fundamental question of trading is this: “How do I act on this signal?”

14/ This is what prices look like to a trader. Most of the time they’re zero. But sometimes they’re not. An “entry”, in this way of thinking, is a disagreement with the world that’s “big enough to matter”.

15/ Ok, so we did a trade. Now what? I’ve made money in theory (known as Sklansky bucks in the poker world), but you can’t spend expected-value dollars. Unless you’re Adam Neumann or something. (I still marvel at what he was able to do.)

16/ In order to actualize your $, you need to close out your position. You need to “exit”. And this is the question. When do you exit?

17/ Fundamental concept #1: “All exits are *entries* into a different position.” Exits and entries are the same! This may sound vacuous but I assure you it’s not.