THE MARKET WIZARD THREAD
- Thread starter candletrader
- Start date
if you believe that it's just as easy to turn £1 into £2 as it is to turn £1billion into £2 billion, then you've obviously not thought properly. theory and reality are not the same. in reality you get diminishing returns, which means that you can't keep making X% every week.
what makes me laugh the most on these boards is when people say you can't trade futures with only a few thousand, because you need 25k! Barnum's law is still true! get it through your heads that you can't make geometric returns!
i've written this as a reminder to everyone...
what makes me laugh the most on these boards is when people say you can't trade futures with only a few thousand, because you need 25k! Barnum's law is still true! get it through your heads that you can't make geometric returns!
i've written this as a reminder to everyone...
"Baldwin retired from the Bond pit several years ago with about 30 million. He promptly sunk almost all of it in a publicly traded tech (forgot the name, it's history) and lost it all. Now he's back in the pit trying to scrape out a living. Very Sad."
I have to say, I am not sure I believe this. For one thing, I remember a Baldwin Development (or Construction) company near the CBOT. I was told he owned that. Also, I was told he owned the building that the company was in. If this is the case, I don't believe anyone here knows all that he owns or has interests in.
In addition, he only had a 30 million net worth after all those years in the pit and being one of the biggest players there? I find that hard to believe.
I have to say, I am not sure I believe this. For one thing, I remember a Baldwin Development (or Construction) company near the CBOT. I was told he owned that. Also, I was told he owned the building that the company was in. If this is the case, I don't believe anyone here knows all that he owns or has interests in.
In addition, he only had a 30 million net worth after all those years in the pit and being one of the biggest players there? I find that hard to believe.
Have you studied hurst and cycle analysis? Checkout http://www.theuptrend.com . Attached is the current "panic zone chart" for s&p500.... it is another tool for knowing when the herd is getting too excited in one direction.
Quote from iceman1:
I too liked Mark Ritchie's book..... recommend it
Ice
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Ive got a skeptical part of my mind which has kept us out of lots trouble ; however i think there is a high probability Mark Weinstein did what he said.
[1] PROVABLE , according to Schwager, Weinstein trading 100k options into 900k less than 1year wasnt it???[profitable week may mean 1 penny profit also] Perhaps Mark may be the most thorough,hard working of them all; charts for wallcoverings!
[2] Perhaps as amazing Bruce Kovner making 92% one year and maximum drawdown of -2.19% in 1985-2000.[Louis Peltz Superstar book & only other Kovner loss year was-0.85% ,1985-2000]
[3]Lots of things from many of those top traders like most of them discretionary and takes a certain discretion with trading systems also.
[4]In a discretionary context ,2 mentioned 20 day MA.
[5] Little things which seem to compound over time;
like green tea,green tree frogs,reading or book fanatics in a good sense.
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''Rare book collecting also a passion ''-Bruce Kovner
He left the 30 year pit in 2000 and returned to the 10 year pit in Jul. 2001. The company he invested in is called Appiant Technologies (ceased US operations on Mar. 22, 2003).
I can't confirm the size of the loss, but I can confirm that he was trading 3k contracts at a time in the 10 year pit when he returned.
For anyone interested, he did an interview in the Jul. 21, 2001 Chicago Tribune "Electronic part is just not fun" that can be downloaded for $2.95.
Just click here and press the search button. First article is about his return.
http://pqasb.pqarchiver.com/chicagotribune/index.html?ts=1053546639
He's back in the bonds trading 50 lots.
This thread has already touched on Mark Weinstein's claim to have never had a losing week... as I previously stated, the Mark Weinstein interview kinda lacked credibility... even Schwager conceded that Weinstein's spiel sounded preposterous...
I thought I would bring up another stat, this time from the New Market Wizards book and in the Linda Bradford Raschke chapter...
The question and answer:
What percentage of your trades are profitable?
About 70 percent.
... evoked a further question from Schwager:
Is your average winner also larger than your average loser?
On my short-term trades, on a per contract basis, my average win is about $450, and my average loss is about $200.
So, if I am reading this right, Linda is hitting 2:1 with 70%... anyone dig this?
I thought I would bring up another stat, this time from the New Market Wizards book and in the Linda Bradford Raschke chapter...
The question and answer:
What percentage of your trades are profitable?
About 70 percent.
... evoked a further question from Schwager:
Is your average winner also larger than your average loser?
On my short-term trades, on a per contract basis, my average win is about $450, and my average loss is about $200.
So, if I am reading this right, Linda is hitting 2:1 with 70%... anyone dig this?
updates and thoughts on various Market Wizards:
a. Nobody has mentioned on this thread the Michael Lauer scandal that has occurred after Stock Market Wizards. Basically his entire fund is being accused of being a complete scam and the supposed $1B in assets his fund is worth has basically gone to 0. He's being implicated in various penny stock manipulations and people can't get their money out. NY Post has done a series of articles on him by Chris Byron.
b. Check out Eckhardt's recent returns here: http://iasg.pertrac2000.com/SnapshotPT.asp?ID=114
All decent, just not the 40%+ he was returning in the mid 90s when he had much lower assets.
c. Trout is my favorite in the books by far. Great stories, great growth in his assets. Solid returns. I like his approach of basically finding patterns and trades that hold up under the scrutiny of statistics. Both Trout and Crabel used to work for Niederhoffer.
d. Gil Blake is great, not so much in his sector rotation stuff (which is out of date at this point) but in his comments that if the expected value of a system is modestly positive then you just need to generate as many trades as possible to have a decent return. Something I always consider when hit with a loss.
e. Ahmet Okumus, from Stock Market Wizards, had a bad year last year. I think down over 20%. But he is a deep value guy which has worked huge every year since he started except for last year.
f. Is Mark Weinstein legit? Other than the book I have not read or heard anything about this guy. And yet, I believe it. I think if one is going for small scalps with not so much money and wait for extreme moments (like VIX > 50 and QQQ down 3% intraday, buy QQQ and go for 1/2 %) you can have close to 100% success but just not make many trades and thats the impression I got from that chapter.
This thread has gotten me thinking I should reread these books. Good stuff.
a. Nobody has mentioned on this thread the Michael Lauer scandal that has occurred after Stock Market Wizards. Basically his entire fund is being accused of being a complete scam and the supposed $1B in assets his fund is worth has basically gone to 0. He's being implicated in various penny stock manipulations and people can't get their money out. NY Post has done a series of articles on him by Chris Byron.
b. Check out Eckhardt's recent returns here: http://iasg.pertrac2000.com/SnapshotPT.asp?ID=114
All decent, just not the 40%+ he was returning in the mid 90s when he had much lower assets.
c. Trout is my favorite in the books by far. Great stories, great growth in his assets. Solid returns. I like his approach of basically finding patterns and trades that hold up under the scrutiny of statistics. Both Trout and Crabel used to work for Niederhoffer.
d. Gil Blake is great, not so much in his sector rotation stuff (which is out of date at this point) but in his comments that if the expected value of a system is modestly positive then you just need to generate as many trades as possible to have a decent return. Something I always consider when hit with a loss.
e. Ahmet Okumus, from Stock Market Wizards, had a bad year last year. I think down over 20%. But he is a deep value guy which has worked huge every year since he started except for last year.
f. Is Mark Weinstein legit? Other than the book I have not read or heard anything about this guy. And yet, I believe it. I think if one is going for small scalps with not so much money and wait for extreme moments (like VIX > 50 and QQQ down 3% intraday, buy QQQ and go for 1/2 %) you can have close to 100% success but just not make many trades and thats the impression I got from that chapter.
This thread has gotten me thinking I should reread these books. Good stuff.
Smells like bullshit, doesn't it.
I've heard from some people that she made a real mess of trading managed money, although that isn't necessarily a knock on someone's trading ability.
Still, I really have to wonder what a bona fide wizard is doing flogging a chat room service.
Like Vishnu, I too felt like rereading the Wizards books. Boy that David Ryan guy sure is a case of right place at the right time! The kid grew up with a passion for stocks, by the time he's grown up stumbles onto Bill O'Neill -- with the CANSLIM method, which is, imo, probably the best way to trade in a bull market -- and it's 1984; can't ask for much for than that!