WA MAGAZINE JanFeb PDF A - Flipbook - Page 34
THE BIG IDEA
Hit “Snooze” on
Overnight Trading
Forget market timing. More time to play the market
does not equate to better client outcomes.
e say that time in the
market is what matters,
and in that scenario, as
more and more brokerage platforms are
pushing toward 24/7 trading, we all have
a fantastic opportunity to triple the time
we now spend compulsively refreshing
our market screens.
Extending the market day is only
a windfall for “day” traders. For the
rest of us, it’s an open invitation to
overthink, overcompensate,
and ultimately overwork
every assumption
baked into our client
portfolios.
Sure, it’s tempting to never clock
out. After all, a
lot of things can
happen overnight,
and other traders won’t be shy
about exploiting the
ability to trade ahead
of tomorrow. If you don’t
join them, your clients get left
behind.
Maybe they miss a once-in-a-lifetime
entry point. More often, they get left
holding the bag. Sleep is for the weak.
You can stay awake a few more minutes,
refresh the screen a few more times just
in case.
And so, the cycle of second guessing
consumes your whole life if you let it.
But get real: if constant oversight was
the key to the benefit plan, none of us
would get anything done between the
hours of 9:30 and 4 Eastern.
That’s not true. We pull our eyes off
the market for client meetings, professional development, school functions,
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34 | JAN/FEB 2025
the occasional medical appointment, or
other errand. The world does not end.
Arguably more important work gets
done in those meetings than staring at
the trading screen. If anything, the more
time you spend watching the market, the
lower the return on your attention gets.
After all, we tell our clients that our
job is to help them sleep through all the
little noises that sound so scary in the
dead of night. That extends to us. If we
can’t ignore the trade button and hit
the snooze button now and
then, something has gone
seriously wrong.
Your clients
should be able to
sleep through the
entire trading
day if that’s what
they want. They
can even take one
of those mythical
“vacations,” check
out in May, and not
pay attention again
until September, or whatever their seasonal preference
happens to be.
When the noise gets loud enough,
we’ll all wake up and take appropriate
action to make sure the investments
align with reality. Otherwise, leaving
the overnight session to high-frequency
operators and other specialists who live
for noise probably won’t make much
difference.
If anything, letting them work out
their anxieties and ambitions in the wee
hours might even contribute to calmer
market conditions in the morning when
the old-school exchanges open up. We
sleep through the storm and wake up
refreshed. How great is that?
Publisher
Jerry Cooper
Editor-in-Chief
Scott Martin
Editorial Project Manager
Monica Boyer
Contributors
Jerry Cooper, Scott Martin
Art Director
Scott W. Valenzano
Social Media Manager
Kevin Cappy
Marketing and
Communications Writer:
Madeline Garfinkle
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