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Fighting the Market

  1. I know that tourists and steady Members of this board like trading stories, so I thought I'd share one that might be of some benefit. Most stories are just funny or bizarre, but a few can be quite useful.

    I have noticed over the years that some traders are strongly predisposed to a personality trait that has them consistently fading any market. They want to fight the market.

    In the 1990's there was a very big, quite prominent 30 Year Treasury Bond independent local futures trader by the name of Chip Kenyon. He gave a brief seminar talk at a CBOT event in Chicago, and I made sure to attend. He told the story of himself building up his account to the point where he was ready to stop leasing his Full Membership and buy it outright. It was a big goal and milestone in his career. In essence, he went on to explain how he gave back his year to date (and the seat purchase amount) in basically one horrific day "cannonballing" the market. [cannonball is an idiosyncratic term for fading everything for size. Just because.] He went on to call the behavior a "disease", and vowed to never do that again. He was just going to stop fighting the market. In several weeks time since that vow, he had quite impressively recovered his account from that disastrous day. He went on to buy that Full Seat, and he concluded that since that quite painful lesson his trading really took off to the next level. He was still at the time of his speech very bitter about 'the complete waste' that horrific day was. At the time of that speech, he was known around the pit as a trader who would take a 2500 lot. If there was a floor broker looking to move serious size and assure a fill for his client with the least drama then Chip Kenyon had the reputation of being one of the few locals that a floor broker could count on. And there were only a few locals like that around.
     
  2. The market is not impressed with size, it will take whatever you recklessly risk.
     
  3. Well, to your point, in terms of liquidity that's precisely what made the CBOT Bond market work in the 80's and 90's. In fact, the President of Cantor Fitzgerald famously said something to the effect that 'the CBOT Bond Market works because there's always some idiot who will take a thousand lot'.
     
  4. Somebody said in here:. " Trade the market you have, not the market you want". Simple but hit me like a ton of bricks.
     
  5. FYI to all - interview with Chip Kenyon: http://erdmiertrading.blogspot.com/2014/05/chip-kenyon.html
     
  6. “Hoping to recoup is what ruins the gambler.”
     
  7. This guy's not a true trader...he's one of the old, typical, dinosaur pit scalping traders who would take/cheat/skim/arbitrage some money out of the client orders he handled.

    He even said it himself, his skill/strategy/edge is no longer active and working since the electronic computer trading revolution took over mainstream.

    Trading, or true trading, is the ability to foresee/manage/predict/tame the market in the here and now with your own money.

    This story reminds me of the Tastytrade boys. Relic pit 'traders' scalpers Tom Sosnoff and Tony Battista.
    Computers/online trading is the meteor that wiped all of them out of the game, screaming neanderthals.

    Turn those machines back on, Turn those machines back on...!"
    Oh my god. We're ruined, Mortimer.'
     
  8. Will you please STFU already

    You have two types of posts-
    1) criticism
    2) hindsight trades

    Fucking annoying.

    And- "He's not a true trader. He's a dinosaur".
    I have no idea who the Bond guy is nor do I care. The guy was trading in the 80's and 90's and apparently was crushing it. Two decades of work and retire in your 40's with millions sounds a lot better than trading until you drop dead in front of your screen "adjusting your strategies".
    He's set for life so who cares if his strategies don't work anymore.

    Your posts are pure pain
    Welcome to ignore
     
  9. Best post of your life.. LL is a bed wetter or a bot.
     
  10. LOL

    Took awhile, but we finally agree on something :D
     
  11. Yeah, please fuck off with the pit dinosaur analogy for this specific circumstance - this is a universal transcendent malady.

    FWIW, I have personally seen a trader lose $4.4M in one day “cannonballing” the market. On the screen. Totally electronic. In 2006. Interest rates. Russian. Shared office in CME building. 32” screens with quad card running TT combines with his obvious outbursts of angst so yeah it was quite obvious. Frantically wiring money. Personal visits from FCM harried Risk Manager.

    A trader can actually be MORE stupid on the screen as compared to the pit. Speed and accessibility insures that.