so there's this person i know, more of an acquaintance than a friend, who literally seems to have the anti-Midas touch, where everything the guy says the market will turn out to act the opposite on. too many instances to count, but i started noticing it one time when he mentioned a major company whose stock he decided to go long in - fair enough, i didn't care, but he just went on and on on that stock. of course, within a few weeks a major scandal broke and the stock just tanked. that played out so many times in different ways, not just with individual companies, but w/ market indexes too, he'll literally call out a sell at the low point and a buy at the high point, don't want to make jokes but it's like a superpower on X-men or something but just like the Unbreakable movie where for every Mr Glass there's a Bruce Willis, i wonder if anyone you know is the Bruce Willis of trading/ where every trade they take turns out to be right? bc from observation if that guy could be Mr Glass of trading, maybe there's a mirror image of him out there somewhere who's Bruce Willis also, after reflecting on the pattern, i don't think its simply momentum following applied too far, like the old jokes about CNBC/ Economist headlines, it almost feels like the anti-Midas got a *different* way of thinking altogether that gets him to zoom in and pick out the bad trades to take. maybe like in nature, where there are mirror image stereoisomers, there are also mirror images of traders at the opposite extreme ends of the performance bell curve
not surprising at all. how do the pros pay themselves so much... the money has to come from somewhere - the dumb money. and the dumb money actions are predictable.... and it's not like some magical anti midas touch... their actions are affected by the price movements, as well as all the media brain washing.... in other words, your friend is just one of the millions with the anti midas touch.
In 2009, we were "Midas", but I guess everyone would, who had a capital and would go with FAZ in February and then switch on FAS. This was huge success as not yet traders, but half way between traders and investors. But the feeling of instability, of not correlation between results and entries, chaos in taking decisions and failing P/L drive us to finally realize that something different, such as professional trading, should be, which is possible to make without probably huge capital, so we opened our first retail account with small capital, dedicated to this learning period and started to trade stocks. And for the first two - three months we were exactly anti-Midas : I would determine with unbelievable accuracy and would pick up the stocks for a long, exactly at the moment they would reverse, and when they would be at the climax of the bottom I would go short. It even happened once that we were all exited about one new stock and could not buy it that evening because our baby would cry too much, so we said will do it in the morning. But in the morning it was delisted! There were more stories. We had many laughs, until the cold realization came that not only we are not doing any profits, but day by day our daily limit of loss is filled. Nothing of magic or bad course - simple lack of TA and experience, always late to recognize move or too much excited and trying to predict. This was healed step by step with acquiring TA knowledge and a lot of exercise. Hope your acquaintance will arrive to change before he will finished capital or decided to quite.
And it is absolutely fair that those who invested time and diligences are prevailing over the others, who are not. And because of this inner mechanism, I am devoted believer that through trading our whole society of human beings is getting into the new level of harmony and peace. There were no other humans activities were premium for the absence of weakness and devotion to the mastery, would be so high and stable.
That's the key word. What's the sample size? What's the time frame? (a broken clock ...). That may be, but it doesn't make it easy to take advantage of it.
Could be a genuine evolutionary trait, that a select few members of a tribe are always wrong. So the tribe survives and thrives, by taking opposite of advices or reflecting deeper. In some cultures, such people may even be revered and celebrated for their wisdom (thinking differently). On their own though, would be hard to survive, so a symbiosis with tribe. There's a huge danger in monoculture, that everyone thinking speeding up is rational, while headed for the cliffs. Last step in exponential growth has highest growth and no time left for alternatives together. The true contrarian will always be "wrong".
I have a friend who gets a call every year for the past 10 years from the compliance department at Scottrade asking if he has inside knowledge of the companies he traded. He is so precise at timing the entry and exit. He bets big and only has one or two positions in the account (low to mid-six figures). His annual return is about 80% for the past 10 years. He did blow up his account once in the 90s during the tech bubble.
exactly, maybe if there are enough outliers/ market wizards on one end of the bell curve, there are also outliers on the other end