With the baseball season having recently started, here's an interesting question posed by Victor Niederhoffer over at Daily Speculations: "How many things are there in baseball, the swings, the runs, the cycles, the signals, the deception, the consistencies, the standings, the All Stars, et. al., that are directly relevant to trading and could make us better?"
Already, a number of readers have weighed in with their observations. Tim Melvin, for example, explains that winning 60% of your baseball games and winning 60% of your trades is enough to make you a champion: "Although you have to play to win every day, no team ever has. Winning 100 out of 162 is considered a mark of greatness. A trader who wins 60% of the time day in and day out will probably also reach greatness. There will be losing days in the market as well. Shrug them off and learn from them. There is another game tomorrow." Alston Mabry finds a link in the reams of statistics cited by both baseball experts and traders: "Talking heads use meaningless stats to produce commentary: "Rodriguez is hitting .243 for the season, but on the road against left-handed pitching, he's only .218."
Watching the Yankees and their kid pitchers Phil Hughes (0-4 with a 9.00 ERA) and Ian Kennedy (0-2 with an 8.53 ERA) struggle out of the gate this year, I might add one more observation: Even if you deeply, truly believe in an investment, there may be a time to reduce your position if that position is starting to drag down your whole portfolio.
[image: Just a Fly Out by ohad* on Flickr]
pic from myteamprints.com