some of the Market Wizards are taking hits.
- Thread starter MainFramer
- Start date
- Status
That is impressive
or is it???Moving that kind of size and achieving those kind of results is EXTREMELY aggressize and requires big leverage and big risks IMO
There is usually a flaw in their risk and exposure calculations... One rare event and they are gone...
Personally I like to know that I am gonna be in the game no matter what happens... I can be MUCH more aggressive than I am now if money were my sole motive BUT it's not at all... and for me every $ I pull out is just more insurance that I get to stick around and play the game... Success at the end of the year is to know that I am gonna be able to play the next one...
I think a market wizard by the name of Seykota once said "There are many bold traders and many old traders BUT very few old and bold traders!"
PEACE and good trading,
Commisso
Com,
I have said this to P2 as well - I do not believe that he has ever experienced a 6 Standard Deviation event, or God forbid, a 20 Standard Deviation event like "Black Monday" that sent highly margined people out of high rise windows in Chicago.
BTW, Taleb, in his new book, goes thru some of this in an interestingly refreshing way.
nitro
I appreciate your concerns. As for the people I'm talking about. I know that many are just very short term traders. I don't want to use names, but I've seen one who just trades 1 stock at a time, he takes mid 5 fig positions and scalps for quarters and halves. I don't know if you believe it's possible, but I've personally seen him have 6-figure days. No leverage of course for him.
--------------------------
As for me, I believe I've experienced a few 6 sigma events. I was over 100% long on sept 11, as the market began to drop. I added exposure up to 150% or so long before the halt. When we reopened, I was sitting on nearly 15k in worthless call options, and another 20k in open losses. I somehow managed to claw my way out of that mess and close the day with a small gain (extreme volatility is your friend I guess). I think that was a 6 sigma event, or as close to one as you can find, though I bet nuclear winter is a step further into extremes. I have said this before and I'll repeat it again. I take a lot of risk. I will never blow up. I have way too many internal controls for that. If I suffer a 20k loss, I'm done for the day. No questions about it. Buying bottoms will always work. There will always be bottoms in the market. There may never again be readable trends, but there will always be short term bottoms. As long as one individual stock or trade doesn't destroy me, I'll be able to make back any ammount that I ever loose.
I've not had a drawdown from peak to trough of over 15% in almost 2 years. I've only have only had about 3 or 4 that were over 10%. The most recent one was 2 weeks ago, and I rebounded the next week with a 30+% acct gain in the following 7 days.
Finally, when I talk about accounts, I am referring to my trading accounts. I have a seperate account for longer term stuff and I sweep my trading gains periodically into the other account to make longer term investments. If you don't trade all your money, there is very little chance of blowing up.
--------------------------
As for me, I believe I've experienced a few 6 sigma events. I was over 100% long on sept 11, as the market began to drop. I added exposure up to 150% or so long before the halt. When we reopened, I was sitting on nearly 15k in worthless call options, and another 20k in open losses. I somehow managed to claw my way out of that mess and close the day with a small gain (extreme volatility is your friend I guess). I think that was a 6 sigma event, or as close to one as you can find, though I bet nuclear winter is a step further into extremes. I have said this before and I'll repeat it again. I take a lot of risk. I will never blow up. I have way too many internal controls for that. If I suffer a 20k loss, I'm done for the day. No questions about it. Buying bottoms will always work. There will always be bottoms in the market. There may never again be readable trends, but there will always be short term bottoms. As long as one individual stock or trade doesn't destroy me, I'll be able to make back any ammount that I ever loose.
I've not had a drawdown from peak to trough of over 15% in almost 2 years. I've only have only had about 3 or 4 that were over 10%. The most recent one was 2 weeks ago, and I rebounded the next week with a 30+% acct gain in the following 7 days.
Finally, when I talk about accounts, I am referring to my trading accounts. I have a seperate account for longer term stuff and I sweep my trading gains periodically into the other account to make longer term investments. If you don't trade all your money, there is very little chance of blowing up.
I know of a few. I believe they all trade for themselves. They have pretty intense software. I've honest to god seen one of them take over 100k csco for a 2 pt ride when it was in the 50's. Most are ex- marketmakers. The one I'm talking about was the axe in an sp100 stock and traded a few mil shares a day in that stock for a top tier firm. I really can't say more cause they value their anonimity. This man was unreal. His usual day was just scalping this one stock. 5-30k at a time. He'd look for 3/16-5/16. Just over and over. His timing was perfect always. It was just like watching an artist. He was always right, no matter what.
Some of these other traders traded most other stuff. I learned a lot of my GNP stuff from one of them. These guys had real balls of steel. I saw one average into sdli for 200 straight pts down. He was able to use the god rule to get out with a 20k or so gain still.
Some of these other traders traded most other stuff. I learned a lot of my GNP stuff from one of them. These guys had real balls of steel. I saw one average into sdli for 200 straight pts down. He was able to use the god rule to get out with a 20k or so gain still.
~~~~Let me manage it for ya.... lol. You can have 35% guaranteed and I can keep the extra 200% for myself.~~~~
You want a secured loan at 35% interest?
Done. I'll have my lawyers draw up the papers, just two questions:
What collateral will you use to secure the loan, and how much captital would you like? </calling your bluff>
You want a secured loan at 35% interest?
Done. I'll have my lawyers draw up the papers, just two questions:
What collateral will you use to secure the loan, and how much captital would you like? </calling your bluff>
Def,
Be fair now, they are talking about trading gains not investing, and you are a trader. An individual trader or small firm can put up unbelievable numbers; however they can not be compounded into an infinite sum and are not directly related to their capital base. We would probably make no more money with ten times our capital, but we are happy anyway.
- Status