Tao Te Ching (Chapter 26)
The heavy is the root of the light;
The still is the master of unrest.
Therefore the sage, traveling all day,
Does not lose sight of his baggage.
Though there are beautiful things to be seen,
He remains unattached and calm.
Why should the lord of ten thousand chariots
Act lightly in public?
To be light is to lose one’s root.
To be restless is to lose one’s control.
(By Lao Tsu, translated by Gia-Fu Feng and Jane English)
The two lines “Therefore the sage, traveling all day, does not lose sight of his baggage” mean that the wise trader while trading the markets (traveling all day) does not ignore his emotions (his baggage). Emotional baggage can refer to emotional residue that accumulates during both losing and winning trades. Anger, sadness and fear which can be experienced during losing trades are elicited during trades that appear to be to be turning into losers.
These emotions can cloud the trader’s judgment and lead to bad decisions. Elation, joy and greed which can be experienced during winning trades are elicited during trades that appear to be to be turning into winners. These emotions can lead to losses if the trader increases lot size based on a residue of feelings from prior similar trades. There is no easy solution to the problem of accumulated emotional residue. It helps to be mindful of these feelings and not let them influence the current trade.
The Unbearable Lightness of Being
The Unbearable Lightness of Being by Milan Kundera is a novel that was eventually turned in a movie. My interpretation of the novel’s philosophical theme is that taking your life and actions lightly does not lead to the acknowledgement or growth of the human soul. Certain characters aptly illustrate this point (e.g. Sabina and Franz), whereas taking your life and actions seriously gives them weight and significance and can lead to soul-making. Thus, the three lines “Why should the lord of ten thousand chariots act lightly in public? To be light is to lose one’s root.”
The Trader’s Root
What is the trader’s root? The trader’s root is the trader’s deep inner connection to the well of living water called the Tao. From this deep connection with the Tao, the trader can withstand the buffeting of emotions and can intuitively take creative trades which have a better chance of being successful. Stay rooted in the Tao.