Original : www.2stocks.ru/upload/marafon.doc In the end, does not matter, how much do you know about the markets or trading. There is only one criterion for success in this profession - how much money did you raise from the market. Trading is one of the most confusing and complex areas of knowledge. How many people - so many opinions. There is no one way, how to make money on the stock exchange - there are hundreds of methods, and everyone is different. Knowledge is worth absolutely nothing, if you cannot turn this knowledge into money. Trading without a system is a road to nowhere. All successful traders trade systematically. If for several years every day you lose, then you earn, – you get used to it, and you know, that profit or loss for the day means absolutely nothing. Even profit for a month means nothing. Money causes greed. Money causes fear of losing it. To start making money on the exchange, you need to get rid of your own fears and greed. Для этого нужно, so that money will lose value for you - that value, which all people attribute to money
The Great Samurai Warrior has the perfect combination of aggression and discipline.. Too much aggression – and the warrior becomes at risk of defeat. Too much discipline, and the warrior will never be able to attack. Prop Trader – a beautiful samurai warrior behind his trading place.
By pressing the exit button in a career in law, Mike Sent a Sharp Analytical Mind to Wall Street. Having survived the fashion of day trading on the technology boom in the late 90s, Mike teamed up with a close friend. , to launch your own store: . Although the core of SMB's business is proprietary trade, the company also has a mission to develop training programs for traders. After researching several of their new learning products., I will be able to confirm, that SMB is good on the way to achieving its goal.
Recently, I was lucky enough to sit next to Mike and learn about his career., about that, how he raised SMB Capital, and his wisdom for traders.
“Trade – it is the ability to develop and discipline”
Mike Bellafore
Damien Hoffman: Mike, as I, You are a lawyer by training. What made you leave the practice of law and move on to trading??
Mike: I was in my third year of law school., when I realized that jurisprudence – it's not the same, what I need. My best friend, Steve Spencer, invited me to New York for a celebratory dinner. Steve and his roommate from Wharton (School of Business), Jared Keben, convinced me, that I should consider trading with their company. That's why I did it.. In a nutshell, it was the best opportunity, which I had after graduating from law school.
Damien Hoffman: What was your reaction?, when you first saw the trading floor and trading guys?
Mike: My first reaction was to laugh just at the thought of it.. When we first started trading, there were no schedules. There was also no CNBC or news feed.. We had one old computer and no air conditioning. [both laugh].
Damien Hoffman: What a year it was??
Mike: 1998. When it got too hot, our decision was to send a gang of messengers for ice cubes and ice cream sandwiches. [both laugh]. We were in an unimpressive building on 50th Board Street.. The ceilings were 7-8 feet. We were all cramped., and perhaps to my left and right was 6 feet. I had to use the phone with another person. This, undoubtedly, not a picture of really rich Wall Street firms, that you could see in the movies. But the environment was competitive., filled with guys, who really like to trade, guys, who make a lot of money, good guys, and cheerful guys. Even with such an unimpressive infrastructure., it was a great opportunity.
Damien Hoffman: That sounds fun..
Mike: And so it was.!
Damien Hoffman: How did you succeed in that environment and get off the ship?, to start your own business?
Mike: That's a good question.. After a year at this firm, I had enough money., to trade on your account. And for more than ten years, this is what, what I do. Then came the moment., when trading became insufficient for me. I wanted to do something else. – something big, due to the lack of a better word. At the time, I found out., that there are many start-up companies, which attracted traders. I started thinking about, how I have learned over the past ten years and gained skills, which could serve well for that, to start this type of business.
Somehow I happened to be on the website of a journalist, with whom I did not have a relationship, and found him interviewing a person with excellent content regarding discretionary trading. The interview spells out almost everything, what i was going to write about discretionary trading, when did the survey. Posted by Joe Schenk , president First New York Securities( group 3 the most famous trading companies) And, where i started my career as a prop trader. Thought runs like a red thread, that trading is an art, and not science, which he memorized and went to thresh in the market. Because of, written in the first sentence, I do not give a link, but I will copy, what does he have. Think, that he will forgive me. He doesn't read me anyway :)
From my experience, this is absolutely true. The best traders have an unexplainable gut feel that they are in tune with and trust in their decision-making process. Any technical or fundamental analysis does not represent hard and fast rules. The rules only work within the context of the overall direction and movement of the tape. Fundamental guys buying financials in 2008 without respect for the downward momentum would have seen painful losses. Likewise technicians highlighting a head and shoulders pattern in June 2009 failed to respect the incredibly strong bid that had entered the market. Intuition can certainly trump strictly quantitative strategies.
Simply put you will not win in the quantitative space; your approach must be different. In order for traders to succeed in a highly quant-driven tape they must develop a feel for the overall market and understand the ebb and flow of particular stocks and markets. Feel is very abstract, nearly impossible to teach and for the most part will only come through years of experience.
But there are two particular daily activities I believe traders can do to help significantly shorten the learning curve. First, follow prices. Making a purposeful effort to memorize prices will allow you to contextualize any movement over time. This includes internalizing charts in order to know the history of prices. Second, read read read. The only way to understand the prevailing psychology is to gauge price reactions against headlines. There are many great financial blogs out there that help in determining broad sentiment.
<…> Beyond developing feel, I believe traders are well-served by studying fundamentals. Trading plans must be arranged well before the stock hits the buy or sell points. Most important for me is background research on the underlying companies. My best trades have always occurred when I have the greatest amount of conviction in the idea. This conviction is only gained by putting in-depth research on the idea.
Holding stocks for longer periods of times will only be consistently profitable if you are correct on the motivating factors behind the buying or selling. While it is probably not necessary to know the long-term debt to capitalization ratio of a given firm for example, it is important to recognize catalysts and know their impact in order to swing trade effectively. With technical levels becoming more fluid than ever before, the ability to hold through tumultuous volatility is only possible by intertwining fundamentals into the equation in order to maintain confidence in the trade.
At the end of the day, as argued by Muthuswamy, “so went the pit trader for the electronic trader, so will the quant human trader go for the robo trader.” Admitting the inability to compete as a human is the first step, the second is to find a new method. There is huge opportunity in swing trading as volatility remains elevated currently at 27%. High beta names have huge ranges on daily basis. The keys for out-performance over the next few years will be those that are in tune with the tape and those that generate fundamental conviction for their trades.
People talk, that the current levels of Chinese stocks have already taken into account so much of the negative, what's next only up. Two thoughts on this. For starters, Japan and China from their highs 1989 And 2007 respectively. On the chart 250 weeks. Such comparisons help in only one thing. – imagine something, which is very difficult to imagine. No more. And the second is, that dominance in economic growth does not mean dominance among stock markets. Just like GDP growth does not mean stock growth by default. & quot; To the world community" it took six months to believe, that the American market is stronger than the rest (in most new strategies, the view is shifting in favor of large American stocks).
Champions League Winner 2009 Sergey, performing under the nickname dettier, so far the undisputed record holder in the entire history of the competition. He managed to turn the start-up capital 36 thousand. rubles in 2,8 million and earn 7 869%. To the finish line in the rank of a leader he was led by an adequate perception of risk plus a minimum of emotions during trading.. And indeed, why be nervous in vain, because scalpers do not leave open positions overnight… - Do you like gambling? - Yes, i like cards, poker, but they are not interesting to me as a source of adrenaline. Quicker, as a mathematician I like to predict, calculate. - That is, you cannot be called a risk-averse person? - It is forbidden, rather the opposite. - Do you spend a lot of time on trading every day?? - It all depends on the situation. I do not like trading in a sluggish market. However, if the market is interesting, I can work "from call to call", from opening to closing of the main session, i.e 8 hours. - And it happens so, what you see at the opening - the market is weak, and decide: let it be a day off then? - I try not to make myself a weekend. I always trade at the opening and statistics. However, if the market is not interesting to me at the moment, I look at him half an eye, while doing other things at the same time. - How often has this happened recently?? - Basically, …
