Tuesday, November 8, 2011

What I've learned (Esquire knockoff)

Esquire magazine has a column each month entitled What I've Learned and various 'famous' people share knowledge on what they've learned through the journey of life.  Most of those interviewed aren't that interesting or even ought to be looked at for advice (reality stars, actors, etc...) but there are some great interviews in the archives worth reading.  Anyways, here's what I've learned mostly from having worked in and around various trading pits from 1998 until 2005 when I left to go fully electronic.  Generally it scares me when people offer advice/knowledge but these are simply observations over the years.  Or perhaps it'd be better to knockoff the title of one of my favorite books, Ice-T's The Ice Opinion - Who Gives a Fuck?

- As an impressionable eighteen year old, I once read that there were more millionaires per square foot in the trading pits than anywhere else in the world and that no one lived more alive than traders, so that's where I went.  Now it's certainly not the case anymore and tough to say what the equivalent currently is.

- Traders who blow up once tend to blow up again.  Similar to guys who cheat on their wives, if they do it once they'll do it again as it's deeply rooted in their psychology.  Ironically, those who blow up tend to find new financial backing easier than those who fade slowly.  

- Successful veterans tend to be the most helpful and encouraging to those starting along the same path as they know how difficult it is.  It's failed old men who try to discourage younger upstarts from achieving what they could not.

- A trader's wife has to be 100% supportive of trading because either the marriage won't last or trading will likely fail so a choice must be made if there is that rift. 

- "Trader" is one of the most ambiguous words in the English language and my definition is pretty narrow.

- When I first interviewed w/the traders who hired me as their clerk and put me on the path to trading, one of the first things they mentioned was how they go about business, "it's better to do the right thing ethically and lose money than do the wrong thing ethically and make money."

- Optimal level of wealth is enough to do anything but not enough to do nothing.

- There's a lot of miserable rich people and in particular, good health is the truest form of wealth there is. 

- Anyone who is afraid to look dumb or unable to admit fault is dangerous cause it will eventually lead to a large meltdown. 

- In high school, I got into an on the job training program which earned me class credit along with minimum wage and was able to get on at a small brokerage doing clerk work.  One duty was to accept and record checks as they came in and often the big checks would come from rural Kansas farmers who'd walk them in.  The look of caution and ambivalence in their eye when handing over the check was so powerful that I knew that I'd never want to deal w/outside capital or clients in any business later on, it's just too much moral responsibility.

- Successful people are willing to do what unsuccessful people are unwilling to do, i.e. sacrifice their free time, work smart, stay out of trouble, reinvest in their business and themselves, put in the long hours, move cities or countries, trade a paycut for more opportunity elsewhere, delay gratification, etc...

- The amateur looks for the greatest reward, the professional looks for the least amount of risk. 

- I honestly think that no one before or since on the trading floor has ever been mentored by a greater group of guys than I learned about trading and life from.  Brings to mind the song which was played as "Lucky" Luc Robatille's number was retired by the LA Kings a few years ago, it was Lynyrd Skynyrd's "Lucky Man."

That's all I can hammer out at the moment but if anyone has any to add, feel free to put them in the comment section. 

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