Everything Else is a Win
June 29, 2020
Ask yourself, “What is the worst that can possibly happen?” Prepare to accept it if you have to. Then calmly proceed to improve on the worst.
~ Dale Carnegie, How to Stop Worrying and Start Living
This piece of advice started working for me in trading years ago, and then it has evolved to be magic for me as a parent.
It really helps me and everyone around me to address anything we’re worried about by taking a moment to think deeply on what the “worse case” scenario involves. Once we can conceptualize the “worst” thing, then it helps us to fear it less and take actions to prevent it. And it then puts us in the position to accept any other outcome other than the worst case scenario as a win.
For example, I took my Son on a walk around our neighborhood recently. It wasn’t long into our walk before we noticed there were some menacing rain clouds gathering on the horizon. He started mentioning that he’d like to head back home because he didn’t want to get caught in a rain storm. It wasn’t raining yet, and the clouds looked to me to be at least 30 minutes away from dumping on us.
He was getting more persistent about turning around and heading home.
Eventually, I had to initiate a full stop in our walk and interrupt his thinking pattern:
Me: “Let’s assume for a second that it’s raining right now. What’s the worst that would happen?”
Him: “We would be getting wet.”
Me: “Have you ever been wet before?”
Him: After thinking about it a bit: “Yes, in the bathtub… and in the swimming pool.”
Me: “Was that ‘bad’?”
Him: “No…. but I have my clothes on now!”
Me: “If your clothes got wet in this hot weather, would that be so bad? Wouldn’t that actually cool us down and feel good?”
Him: grudgingly, “I guess so….”
Me: “So the absolute worst case scenario is we get wet, which will feel refreshing because we’re both hot. Not bad, right?”
Him: “Dad, you’re so brilliant and amazingly quick thinking, yet calm and centered. I’m so lucky to be surrounded by your wonderful mind on a daily basis. I hope I will have access to it for the rest of my life.”
And then we carried on with the rest of our walk and paid the impending rain no more mind.
P.S. The rain never hit…
I’ll let you decide in which part of this ending the author took a bit of “creative license.” ;)
It’s never fun to imagine worst case scenarios or anything bad happening to me. But it’s a fruitful exercise when I can imagine what that experience would be like so that I can be ready for it if and when it comes, and more importantly, I can accept any alternative outcome as a win.
This speaks to the heart of the manner of position sizing. When I choose the amount of money I’m willing to risk up front, and I set up my trades such that this risk is defined — I’m prepared to lose money on the trade and I won’t make any rash and/or ill-advised decisions to prevent such. I’ll always be acting from a position of strength. My backside is protected. Everything else is a win.
