The sixty-six hours in which you cannot act

The filing goes up at twenty to seven on a Friday evening: the managing director has resigned with immediate effect, and the board will meet next week. You hold more of this company than of anything else you own. The market closed at half past three and opens at a quarter past nine on Monday morning, which leaves about sixty-six hours in which you can read the filing, read every article about it, telephone your brother-in-law, put it to four groups, lie awake, and do precisely nothing. A long weekend stretches the same interval to about ninety hours. What happens inside it is remarkably consistent across people and almost never noticed by any of them: by Sunday night you are considerably more certain than you were on Friday evening, and you know almost exactly as much.

What a closed market takes away

Two feedback signals disappear together on Friday afternoon, and it is worth separating them because they do different jobs. The first is price. During trading hours a wrong view starts costing you within minutes; that is unpleasant, and it is enormously informative, and it is the fastest correction mechanism you have. The second is disagreement. A live order book is a continuous poll of everyone willing to put money behind the opposite opinion, updated every second. Over a weekend both are switched off, and what replaces them is a group chat that mostly agrees with you, containing forty-one people who have read the same three articles.

What everybody else did with the same weekend

This is the point at which the psychology turns into arithmetic. You were not the only person deciding on Saturday. Every holder read the same filing, and so did every fund manager, and so did the people who will be selling to you or buying from you. When the market reopens, those decisions do not arrive one at a time in a queue behind Friday’s closing price. On the NSE they are collected in a [[pre-open session]] and resolved by a [[call auction]] into a single [[opening price]] at which the largest possible quantity can trade — a mechanism the technical track covers properly. What matters here is the consequence: the price at which you can act on Monday is the sum of everyone else’s weekend, and the plan phrased as "I will sell on Monday" quietly assumed Friday’s number.

A rehearsal counter

• Count new facts, not new thoughts. Between the filing on Friday evening and Sunday night, how many things did you learn that were not available at twenty to seven? The honest answer is usually one exchange filing and four opinions about it. Certainty that grew tenfold on one new fact grew on repetition.
• Watch what you chose to read. Rehearsal selects its own evidence. By Sunday afternoon the search terms have quietly changed from the neutral version to the one that matches the view you formed on Saturday morning.
• Write the view down on Friday night, before the rehearsal starts. Then Sunday’s version can be compared against something. Without it, Sunday’s conviction has no baseline and simply presents itself as what you have always thought.
• Decide a price, not only a direction. This is the one that actually changes outcomes. A direction can be acted on at any number, which means it will be acted on at whatever number appears.
• Treat a long weekend as the same thing at a higher dose. Ninety hours instead of sixty-six, with the same amount of new information and a great deal more time to arrange it into a story.