Thursday, September 23, 2010

The Zero Sum Game that is LIFE

I love metaphors. Well, maybe this isn’t a metaphor, but I don’t know what to call it so we’re gonna call it a metaphor. Get over it.

This metaphor deals with one of the most crucial aspects of my professional career: the concept of the zero sum game. In effect, the zero sum game says that for every dollar gained an equal dollar is lost. So if I make $350 on a trade, some other guy will have lost $350. He may have been up $1,000 and got knocked down to a net of $650 or he may be -$350 but in some way, the guy at the other end of the trade lost the same as I made. So, we have a net of $0 ($350 made - $350 lost) and at the end when a contract expires the accounting has an equal debit (sellers) and credit (buyers) amount. It’s brilliant, actually.

Our metaphor comes in how this relates to my life, or any life really. You see, my life in the last few months has been crazy; I don’t need to rehash it because you all read this blog religiously *wink wink* and understand all the stuff that’s gone on, both good and bad. Actually, it's been crazy for years; maybe even my entire life, really. This got me thinking how your life really is a zero-sum game on an inner-personal level; nevermind the outside world, we’re just talking about you or at least those things that are directly related to your life.

Today I started remembering everything that's happened and maybe even feeling a little sad or nostalgic for my old life and all that I’ve lost over the last few years. Actually, It wasn’t feeling sad for what I lost, it was more thinking about all that I’ve gained in this new life (happiness, health, a job I love, eagerness to see the new world around me and share all this happiness with read the blog, you know) and the person that is the new or reawakened and better Me. But, I stopped and glanced over my shoulder and saw the wreckage that was a previous life; what I don’t have any more. At that point, it dawned on me: that was the price paid for all that I have now. All the money I’ve lost in chasing my dreams and keeping me afloat, the time, the stress, the agony, sadness, loss of a relationship, my dog, leaving California and all those friends behind, the surfing, sun, In-n-Out Burger, 90mph on the freeways…all those things were lost or used as payment for all that I have now; a true zero sum game.

However, what’s not told about the zero sum game are the intangibles; those things than cannot be measured in dollars and cents, at least in actual trading. In every trade there’s an equal dollar amount that’s gained and lost but there are also lessons learned, experience gained, wisdom added to your bag of tricks. These things have no monetary value but they maybe have something more important than monetary value as they make you a better trader. In theory (if you’re doing it right) you’ll pull from these intangibles and not make the mistakes that found you on the losing end of a trade or you'll know when to trade or when to wait and you become a better, more successful trader.

When I remembered that, it changed everything; the nostalgia and feeling of loss was gone in an instant. It reminded me of all that I’ve gained but more importantly learned through the process of getting me to where I am with what I’ve got, and I’ll be the first to tell you, I’ve got a lot that isn’t measured in dollars and cents. The happiness and positivity I have, the clarity, the determination, confidence, bravado, focus…I gained all of that from the winning, but mostly the losing trades I’ve made in my life and it’s paying dividends monetarily and otherwise each and every day. It’s brilliant how it all works, really.

In effect, I traded with my life and I came out ahead. But there was a great cost that was paid to get to where I am now. What makes me better than I was-- than I’ve ever been--are those intangibles; the lessons learned, the wisdom gained and knowing what I want from my life is more important than the “stuff” I lost.

So while there is and may always be some feeling of loss for those things, it’s OK because all that I learned and gained from those trades that cannot be put on a balance sheet is worth far more to me moving forward than I could ever put a value on.

The zero sum game really is tricky in that respect: you never really find out what you truly gained until the next trade…


Laurnie said...

This is fantastic

Anonymous said...

I totally get it. The last few years have been the most difficult, but also the most enlightening. Lunch soon? Fonz