On the strategic edge in enjoying the opposition.

And why these seem like oddly dangerous times to be in the markets...
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Trading is a zero sum game - make no mistake about it.

Every trade you do, you think you’re right.

On the other side of that trade is someone who thinks they’re right and you’re wrong.

Always.
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Because of this, the only way to actually win consistently is some sort of information advantage - you have to know something the opponent doesn’t (this part is kinda obvious).

What’s less obvious is how wildly valuable it can be to thoroughly map your opponent’s worldview.
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Look at your positions and pick one. Who are you planning to sell it to? Describe them, as best you can, as if they were someone you know.

What led them to take the other side of this trade? Can you see how they got there; how their math netted out being your counterparty?
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I’ve found that any time I can’t create a coherent worldview of my opponent and understand them as a notional person, that often means I’m in a bad trade.

Which means the more certain I am that my way is the only way to see the field, the lower the quality of the trade.
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It seems that true edge comes not just from a better understanding of available information, but also a better understanding of your opponent.

And a real sense of why they would be compelled to take the other side.
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I feel like this is often overlooked! So many people seem to have a hard time valuing or respecting the opposition’s views, and that strikes me as a rather edge-destroying way to view the world.

In zero-sum games, humility isn't just a virtue.

It’s also a strategy.
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This seems to be an oft-overlooked aspect of contrarianism - that one must not just ‘be kinda contrary,’ but also the ability to position oneself on the opposite side of a trade that *actually makes a lot of sense.*
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The most powerful contrarians seem to be the ones who can hold both arguments in their head at the same time, feeling the pull of both, and then identify times when the positioning is shifted to one side because people are missing something in a very *understandable* way.
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If you can’t understand the opposition, you’ll constantly find yourself convinced of the supreme superiority of your positioning! But consider: is that ever truly the case?

These markets are full of very bright people - rarely, if ever, are you squaring off versus a fool..
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Which is why I find these to be dangerous times for investors.

Political and cultural dynamics are turning us increasingly into absolutists.

And that seems to me to be an especially dangerous form of thinking to indulge in when you’re trading…
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In Rome, victorious generals would return to a parade, cheered by the city for their victory. And to ensure they remained victorious in the future, someone would stand behind them during their parade whispering, “Memento Mori, Memento Mori…”

“Remember: you are mortal.”
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In my recent journey learning about finance, a most powerful lesson has come from learning to model the behavior of those who respect the opposition and keep a healthy attitude when considering how others see the field.

The more seasoned the investor, the more they do this.
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It's what keeps me coming back to those like @MetreSteven (best attitude in the biz) @SantiagoAuFund (who can take endless arrows from the trolls) @RaoulGMI (who is always welcoming of divergent views) and @Darky999 (with his provocative podcast guests): their tactical humility.

If I’m honest, this still takes a lot of practice to cultivate (I always quite like my own views!), and it also concerns me to see *any* discussion where people are supremely convinced they have ideological superiority.

Seems like a way to lose a lot of money real fast…
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If you have other suggestions about those who do a good job at this, I’d love to hear about them here in the thread - it’s become a more important feature of quality input than the specifics of the views held.

Memento Mori, friends.

These are extreme times we live in.
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