Can Your Trading and Investing Benefit From the Principles of Jazz Improvisation?
The art of jazz improvisation can contribute a lot to trading and investing. These activities are fluid, not static. They experience ups and downs and quickly changing situations.
Trying to create a large set of rules to cover all possible market scenarios will drain your time, stifle your creativity, and cause your trading system to break down from too much “curve-fitting”.
Improvisation (improv for short) can be the answer. Contrary to what you might believe, this is not about just making up whatever you want. It’s about picking up small, simple patterns that recur in a fluid, chaotic situation. You take these patterns, or a simple set of rules, and stretch them to fit current conditions.
It’s about having a basic framework that enhances your ability to respond to the market – rather than hampering it.
When performing good improv, you neither feel like you have no idea what to do, nor do you feel like your hands are tied. When confronted with a crisis or new market situation, you are able to pull out a few ideas or principles from a previous trade, and then you feel free to modify them through your own creativity.
Good improv has the quality of less ego and more present moment awareness. If something isn’t working, you cut your losses without a fuss, and try something else. There is no anger, blame, or fear – the concentration is on understanding the current market, finding some advantage to exploit, and putting on an effective trade.
By: Praveen Puri
Posted in: Jazz Festivals