accounts.
What people say in the trading rooms and at business dinners is that very few
accounts operate in the black and many of them are not destined to be profitable in
the long term.
These observations certainly do not encourage anyone to start out or to continue as
a trader. It is often commission that makes a trading model inefficient, or over rigid automatic
systems, or the emotions of the trader who uses his discretion. However you look at
it, it seems there is always something that goes wrong, for the majority of
professionals, private individuals or for the often ill-prepared people camping in the land of gold, on planet trading.
managing companies or in general to people whose job is to select managers for
funds’ funds.
Here things become interesting because the manager's goal is to perform, or to
select other managers able to do this for him or her, in order to satisfy a clientele
who will then be willing, too, to entrust them with their own savings and capital.
The war of the managers, in this case, is divided into two sides: one side is looking
for the best performance and the other is looking for the best product package.
You know that even managing is selling a product.
In this case, you should measure the quality of the product by its return over a
period of time, in proportion to risk. The product package is important in every case: just think about the amount of
money that has been raised from the introduction of capital-guaranteed products
after the stock exchange crashes of 2001.
In this case the product’s success does not come from the performance promised,
but from the feeling of “safety” generated by the product.
Some years later you would have discovered that nothing was guaranteed by those
products, as the risk assumption made during subscription was based on bonds
issued by certain banks that wrote the history of finance and today do not even have an official web site.
are able to achieve positive performance in the long run, but without avoiding
periods of loss of varying length.
The manager profile is that of a professional starting out as a private trader or as a
trader working at the desk of one of the main managing banks, who decides to offer
his or her own consultancy to certified managing companies, or to open their own
company betting on their own abilities as a manager and a trader.
One of the phrases that most impressed me and that best sums up and describes
collective opinion, is the following: “it does not matter if you earn or lose, what matters is how you earn or lose”
desire for high profits and independence.
Traders win above all because they risk their own capital, they enjoy the chance of
working anywhere in the world and they earn sums of money that most people
cannot even imagine.
Traders believe in themselves and in their trading system.
After a long time researching, they land on a suitable trading system and as far as
they are concerned, there cannot be another system that lets you earn as much as
theirs does, or even that lets you earn anything at all.
Why do successful traders not believe that another trader can earn money with a different trading system?
The dream of freedom, wealth and prestige that everybody would like for
themselves and for the people close to them.
The chance to say “go to hell” to their boss or colleagues.
The wish to find an ability in themselves to be successful challenging the market,
through their own strengths and maybe only in their spare time.
Does anybody ever asked themselves whether a commitment at the highest level is necessary in order to achieve excellent results?
My identity as a trader is very strong and I would never be able to justify not being
able to make a profit from the market.
I have had periods of low profitability, or no profitability at all, even after having
acquired a lot of experience and ability.
I’m not afraid of being compared with others, or of admitting this important truth. What I do not accept is giving up a job like this, that defines me as person.
I believe that often even the best trading methods, and I have discovered and
invented hundreds of them, have varying periods of inefficiency or inactivity.
I think this is normal, I do not believe that is good business to sell ice to Eskimos,
and in the same way to do options’ calendar spreads in the middle of the storm of
the financial crisis, or to buy call and put, in a range market, cannot be anything other than a “crime”.