XM Satellite Radio Holdings Inc. (XMSR) Message Board

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Technology Stocks : XM Satellite Radio Holdings Inc. (XMSR)

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To: i-node who wrote (2999)	11/12/2006 5:18:21 PM
From: Sirius_Rich	of 3386

David was this guy writing about someone that lives in your house? "If I could define enlightenment briefly I would say it is 'the quiet acceptance of what is'." -- Wayne Dyer When it comes to the stock market, a very good idea is "accepting what is." Trying to impose our will on the market beast is always going to be a losing battle; the difficulty comes when we try to determine what in fact the reality is. Our view of the stock market is often like looking in a mirror that reflects our beliefs and feelings rather than the reality of the situation. If we are heavily long we tend to see the positives in the market and if we are short we see lots of negatives looming. If we are holding positions, long or short, we are never going to be totally objective about the state of the market. No matter how much we try to convince ourselves that we are open-minded and objective, the positions we hold are going to assert some subtle, and not so subtle, influence on our thinking. After all, if we weren't believers, why would we be holding stocks long? Sometimes it is simply out of inertia, but that inertia often ends up coloring our thinking. So what do we do? Let's admit it and recognize that the only way we are ever going to be totally objective is if we hold no positions and really don't give a hoot about the market at all. We are always going to carry some prejudices and we have to recognize and embrace that fact. The key is to not become so entrenched in a particular view that we resist adjusting our thinking as the situation changes. One of the tendencies of many investors is to become more and more confident in their market view as a trend persists. That generally is the smart thing to do because trends often persist for much longer than seems reasonable, but it is important to not let that fact blind you to signs that conditions may be changing. Our goal isn't to simply ride a market trend but to make sure we ride it and then get out with as much profit as possible. We can't afford to be too entrenched or stubborn with our thought process. On the other side of the equation, we can't keep looking for illusive reasons to justify ignoring a strong trend. One of the easiest things to do in the market is to start finding reasons to justify a turn simply because we think it is reasonable that one should occur. We can come up with all sorts of great justifications for a posture that ignores the action that is taking the place. True enlightenment about the market is never possible but being aware of our prejudices and biases can help us obtain better results.

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