Q: Van, you always talk about trading your beliefs about the market, rather than the market itself. But how do you actually decide what your beliefs are? For instance, I could believe that the market trends, because I see them on a chart with my own eye, and hence use a momentum based strategy,. I could also believe that buying “low values” is the only reliable way to make money, and hence use a value investor approach. How do you decide what your true beliefs are? Especially if several are incongruent?

A: You know what your beliefs are. The fact that you are asking me “how to you decide what your beliefs are” simply suggests how little you know about your beliefs.

One of the exercises I give my Super Traders is to write down 100 beliefs about the markets. If you try to develop a system that doesn’t match your beliefs, it won’t work.