Well, I was speaking not exactly of comparison with a corporate job, but with running a business, which is: once process is set up you mostly supervise and take care of strategic moments, the rest takes care of itself, so that you may not even visit office for as long as you wish at all.
Anyone gave up trading for a living?
- Thread starter turkeyneck
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Well, I was speaking not exactly of comparison with a corporate job, but with running a business, which is: once process is set up you mostly supervise and take care of strategic moments, the rest takes care of itself, so that you may not even visit office for as long as you wish at all.
It's been nearly fifteen years since this was posted, but I've never forgotten it:
I've spent some time lately rereading some old posts, and stumbled across one of the more scornful debates from 2000: the case of the $12,000 harpsichord.
Many of you likely remember the subject, others may have heard reference to the infamous harpsichord but not known the history of it. It has, by now, entered the lexicon of the LBYM [Living Below Your Means] board, usually as a representation of a frivolous expenditure. So, indulge me a moment while I recap the story.
A little over a year ago, on the first of March, a user started a thread titled "The NOT so Dumb things that you bought?" There had been some discussions about dumb things we'd all spent money on (f)oolishly, but one user wanted to discuss things that may have been a little more expensive, but turned out to be well worth the money. (That thread starts here: http://boards.fool.com/Message.asp?mid=12091039 ).
One user on that thread posted:
I bought a new, French double manual harpsichord, custom made for me by one of the world's most famous builders, for $12,201 in 1984.
This caused quite an uproar, even prompting another poster to say:
This is the "NOT" so Dumb things you bought thread. Try reposting.
...to which the original poster replied:
OK, here goes. I bought a new, French double manual harpsichord, custom made for me by one of the world's most famous builders, for $12,201 in 1984.
Good enough for you?
The price tag was daunting for many people, as was the object that money was spent on. Most people wouldn't consider a harpsichord to be a necessity, or a luxury, or even a vaguely interesting item to have.
A few weeks later, on another thread, the poster explained his purchase a little more:
For me, the harpsichord decision was pretty easy. I had the money, and I had been looking at kits for at least 10 years. But I am not handy, and trying to build one myself would have resulted in an expensive piece of useless junk. The decision at the time was harpsichord vs. new car, and the old car, while tired, still got me to work.
Needless to say, the old car started putting out white smoke and needing a quart of oil every 200 miles, about 4 months after the harpsichord was delivered.
So when it was all over, I had a harpsichord and a new Renault Alliance. That was right for me. Another person would have preferred no musical instrument and a BMW. That's fine too, but it wouldn't have been fine for me, because cars for me are just transportation and not an attempt to express my personality or to demonstrate my riches. The music, on the other hand, is very important, for now I can hear Bach and Scarlatti as they might have heard it themselves, just less competently played.
As for how you get to have enough disposable cash to make either sort of decision, the tips on the board can help -- some. Obviously, clipping coupons is not going to put you into a BMW anytime soon. But they might pay for a special birthday meal, or tickets for the children to see "The Lion King" if it goes on tour, stuff like that.
For this poster, the harpsichord was of immense importance. No doubt such a purchase would make sense for very few people, but for someone who expresses this kind of interest in music and had a lifelong passion for it, it became understandable.
This was written over a year ago. Here is the update to that story:
The person who bought the harpsichord was JABoa.
Let that sink in a moment. This is the gentleman whose death last week was lamented far and wide across the Motley Fool boards. He was either 52 or 53 (I'm not sure when his birthday was).
Jim would be disappointed if someone didn't play the role of pedant with this information, so here goes: He said he bought that harpsichord in 1984 for $12,201. Let's say he had invested that money instead. Let's even be generous and say that he could have earned 12% on that money. That would have been an extra $83,773 in his bank account today.
Unfortunately, he met an untimely death. Now, do you suppose that during the past 17 years he got more happiness out of that harpsichord than he would have out of having several thousand dollars more in his savings?
Only he could have answered that, but considering that his love for music was highlighted in his obituary, I suspect he'd still pick the harpsichord.
Am I saying we should all drop what we are doing, quit saving, and spend spend spend since there may be no tomorrow? Not at all.
My message here is there are times to pick your battles. Cut out waste and save money where you can, but if there is something that feeds a personal passion, there is nothing wrong in figuring out a way to make a dream come true.
As with most things in life, you can have anything you want--you just can't have everything you want. Pick your battles, set your priorities, and go for the things on the top of your list.
As is often said around here, the "L" in "LBYM" stands for "living."
--WonderPup
Because:
- People who start businesses have to publish every year a lot of information, they go also many times public by quoting on some exchange. So they are easily known, but maybe preferred to stay anonymous.
- Not traders but bashers always make the conclusion that a trader should be rich. They say: "you should be richer than...." Trying to ridiculize the trader. "If you make 15% a year you should be richer than Buffet." Well I know businesses that make this return but still are not as rich as Buffet. So the remarks count for businessmen too.
- Traders can stay low profile and as a result nobody knows how successful they are.
- Do you know who on ET is rich and who is not? You cannot answer this question but you conclude that or everybody is rich or nobody is rich.
I don't care which retail trader became rich, but there are more than a few. I read the books Market Wizards. This book is full of successful traders.
In my country every year tenthousands of businesses go broke. Does this mean that you cannot become rich in a business or trading ?
You should only care about your own business or trading. Whether many are succesful or not will not influence the results of what you do. I always did things that according to others were difficult for being succesful. Maybe that was the reason why I had some succes as that nobody tried to do what I did, so there was no competition. So maybe I should be grateful to you for spreading your opinion and keeping the competition away.
amazing, this thread. less than a day, so many people responded
mine, screwed up in the first 3 years, stressed out and took breaks (which is actually quit), spent way too much than I should have.
now, doing good in swing trading, as DT haunted me and took my accounts away
if I drive the swing slow, I am surviving
mine, screwed up in the first 3 years, stressed out and took breaks (which is actually quit), spent way too much than I should have.
now, doing good in swing trading, as DT haunted me and took my accounts away
if I drive the swing slow, I am surviving
I took a break (can't say to give up as you never know) from day trading and must say freedom is probably easier to achieve outside of it.
Not sure about corporate world, but in case of running your own business you definitely have more freedom in time, vacations etc. compared to trading, when every day you have to trade since time X to time Y. Yes, theoretically you are free, but practically you are not. I bet most day traders get what I mean.
very true. I responded, swing is less stressful than DayTrade, from my 4 yrs
I am glad for you if you are consistently profitable in trading. Seriously. I had my share of trading profits too, but most were:
a) from mispriced binary options (they just started back then in 2005-6).
b) from high volatility one-way market.
And finally c, the most comfortable way so far from investing "when there's blood in the streets" as well as in a couple of IPOs.
A furniture entrepreneur has everything to gain by being in the papers, being "visible" as he can expand around the world. Most traders have a niche or niches that are size constrained and the successful ones are already trading at the limit, therefore any publicity is more negative than anything. That said, the trader I know was in the papers a few times as he participated in poker tournaments.
I worked at a financial publication myself for a few years, the papers always called wanting to interview traders, the answer always was "I don't think any of the traders like the attention".
You overestimate how easy it is to become rich via trading. Most traders are size constrained and sensitive to slippage, never making more than seven or eight digits - that's not enough to get the attention of the world.
Haven't you read about the Japanese daytraders who made quite a bit, the one guy bought a building in the center of Tokyo. There are also people here who have posted very nice numbers. There seems to be quite a few examples, not sure where the negativity comes from.
Consistency is a very big problem. It took me years before this problem was solved. Somewhere between 20.000 and 30.000 hours of researching, testing, analyzing, demotivation, recharging motivation, adding new money, keeping the wife happy....
Some negativity probably comes from that I couldn't find a robust edge in today's markets (besides long-term investing), because percentage of scammers in this industry is incredibly higher than that in furniture (or almost any other, you name it) business and because if you are right and most trading edges are just little niches, not scalable well enough it may be far from the dream job many imagine it is.
Great point you made. That's exactly what I'm trying to say to people maybe just thinking about trading. Possible? Yes. I know a few very good traders myself. But it is very, very very far from one of the easier ways to make money (reason why most try it). Actually it's probably one of the hardest possible ways to make money, so people thinking about it better think about focusing on something else. Would have much higher odds of success.
If you just like markets, that's different story of course.