I’ve mentioned before about John Boyd and his OODA loop in this blog and maybe it’s finally catching on. The Harvard Business Review recently published a great article by Frank Partnoy about how speed is holding us back and how the OODA loop helps with our overall strategy.
For those unaware the OODA loop stands for Observe, Orient, Decide and Act. It revolutionised the way we train Fighter Pilots and now business leaders have cottoned on. Whats its relevance to traders? Well the first paragraph explains that well I believe:
“Speed is killing our decisions. The crush of technology forces us to snap react. We blink, when we should think. E-mail, social media, and 24-hour news are relentless. Our time cycle gets faster every day.”
I’ve said before that many new people are drawn or channeled into trading intra-day time-frames without having the right temperament, talent, experience or decision-making framework to help them operate in such an environment. This tends to lead to casualties. Plenty of them.
Hopefully by reading the article you’ll get a chance to learn a new way of thinking about how you approach your trading, regardless of timeframe.
I hope you enjoy.