We’ve all hear the admonition to mind our P’s and Q’s.

It means to stay on your best behavior, or to stay at the top of your game or to pay attention to the details.

So where did this phrase come from?

There are many theories, but I’ll give you one of my favorites.  And that is from English Pubs in the seventeenth century.  Back then, like now, bartenders kept a close watch on how much alcohol their customers were drinking… that is to say they were watching their Pints and Quarts.

To those getting a bit “overserved” the bartender would remind them to “mind their Ps and Qs.”

And that seems particularly good advice for today’s investors as we see the stock market continue to climb.  Because there is always a correction.  Just look at the chart below, which shows the history of the stock market since 1900.  Does anybody really believe this will keep climbing in a straight line up from here?

It could, of course, go up for quite a while, but let’s not get all heady and drunk on our recent success.  It’s time right now to start figuring at what point we will sell if the market goes into a major correction.  Best to do that and live to invest another day, instead of riding the thing down too far and taking a big loss.

I suggest that any stock going down 25% from the highest price you’ve owned it is a good place to exit.  This is known as a 25% trailing stop loss.

We don’t need to do that right now, because it is heading up.  But now is the time to start thinking about it.

Because now is the time to start watching our Ps and Qs.

To your health – John Roberts.

P.S. Three hundred years later IBM created the 1620 scientific computer system.  And there was a young programmer (me) learning how to program it.  Programming is basically telling a machine what to do (called the “operation”) and what to do it to (called the “operands”).  So, for example, if there was a number in memory position 500 that you wanted to add to a number in memory position 600, you simply wrote the operation code for Add (which was 21) and the two operands you wanted to add together, which were 00500 and 00600.  The actual computer instruction looked like this – 21 00600 00500.

You can imagine you wanted to be exactly precise with these instructions… that is to say you wanted to mind you Ps and Qs.

Do you know what IBM called these two operands three hundred years later…

They were called the P Operand and the Q Operand.

Coincidence?

Here’s a picture of that IBM 1620 computer system back then… and a reminder to mind your Ps and Qs.