The other day I linked to a Bloomberg piece by Rosabeth Moss Kanter. I subsequently decided to look into her book Confidence: How Winning Streaks and Losing Streaks Begin and End (Three Rivers Press, 2004, 2006). To be more accurate, I looked at the Google Books preview. Let me share a couple of her insights that may be helpful to traders.
“Failure and success are not episodes, they are trajectories. They are tendencies, directions, pathways. Each decision, each time at bat, each tennis serve, each business quarter, each school year seems like a new event, but the next performance is shaped by what happened last time out. . . . In sports, each game starts at zero in a strictly technical sense. Statistically, each player is no more likely to sink the same number of baskets in the next game as in the last game. . . . But many things are carried over from game to game and shape the mood in the locker room; that mood can then follow players out onto the field.” (p. 9)
“Success means that people or teams or organizations survive long enough to need maintenance and repairs—in other words, reinvestment. . . . Their facilities, tools, and bags of tricks get older, deteriorate, run down. . . . These normal processes put a brake on momentum. The upward trajectory cannot continue; repeating the pattern brings diminishing returns. A winning streak requires renewal and rebuilding.” (p. 73)