In my last column I explored the values of Socrates: truth, justice, courage, moderation, and wisdom. I looked specifically at how truth is central to trading. In this column, I want to examine the impact of justice upon trading.

Justice is swift and relentless. Get sloppy, come unprepared, let your attention wander, get greedy, become reckless, become fearful or timid, hesitate, rush, violate your methods or your rules, and you immediately or ultimately reap your just rewards.

Okay, sometimes you get lucky. You sold when you meant to buy as you hit the wrong button, and you made money. You overtraded, and it paid off big time. You took a tip from your neighbor, and you got rich. But these things don't repeat. There are no consistent rewards for poor trading.

Justice trains us. We fail to do the right thing, and we suffer. We say we'll never do that again, but we do it again, and again. Finally, however, we learn and correct. Justice is our friend and our teacher.

Sometimes, unfortunately, we do everything right, and we still lose. We have to recognize the difference between mistakes and simple results. Right actions don't always bear rewards. They will, nevertheless, prosper us over time. The trick is to know the difference.

Surprisingly, justice is not always evenly applied to price and the underlying fundamentals of markets. Crude oil can be chasing $95 a barrel while there is plenty of available oil for those who need it. Rumors and speculation, true or false, can create vast distortions. A rumor about Merrill Lynch or Citibank can bring the entire market, not just the financials, to it's knees. A company reporting record earnings can drop 20% or more. One day everything soars, the next day everything craters, and back again, while truthfully little has changed. So where is justice? It seems as Shakespeare said in King Lear: "Handy dandy, which is the justice, which is the thief?"