I hope everyone is relaxing this week. It seems appropriate, as this year has taken its toll, at least on me. Looking back, I had some anxiety for sure, but more than that, my frustration with the constant doom and gloom is the one thing that I found most problematic. I know, I know, by now that nonsense should not have an effect on me, but sometimes it does. Ubiquitous and pervasive are two words that come to mind when thinking about it …

My reading this morning brought me an interesting thought, one I have had and have talked about more than a few times in this writing space.

  • In 2012, investors’ long-harbored suspicion that the stock market was a rigged game became something of a majority opinion.

Okay, with a raise of hands, how many of you believe the stock market is rigged? No, here is the better question. How many of you believe the stock market playing field tilts in favor of those on the inside? Oh wait, I have a better question. How many of you only now are seeing the stock market as one working in favor of those on the inside?

My point is that this is not news, and it has never been news. Inside trading, big-money firms with contacts and money to buy expensive computers for high-speed trading tilt the playing field, which raises another question. Why bother trading or investing if the stock market is not fair?

I have long argued that the market is “rigged,” but that does not mean the little guy cannot make his or her money work in the market.

  • If anything, the small investor is better served by the current trading arrangements than are large institutional investors, whose need to execute large, sensitive orders is compromised by the software spies’ efforts to step in front of their trading flows.

Yes, there are many instances where big money and fast computers influence price action, and in some cases, they both can create unexpected and sudden volatility that can take you out of a trade or cause you to lose profit. We must all accept that is just the price of the ticket to play in the game. My point is that the playing field, no matter the tilt, still offers myriad opportunity to make your money work. Day in and day out, the market moves up it moves down, or it moves in both directions, which, as traders, we like to see. It doesn’t matter to me why my stock pick is moving; it only matters that it is moving.

Sure, I would like to see as much of the unfair play removed from the market as regulators possibly can, but in the end, I choose to play the game or I do not. My determination for that comes from whether I am making my money work successfully. So far, so good, and as long as that it is the case, it is what it is. I don’t have time to worry about how others use the market.

  • The good news in all the frustration with our tangled trading system is a renewed focus on rationalizing it.

Oh yeh, good luck with that …

Trade in the day; Invest in your life …

Trader Ed