alright, we all know about george soros, stanley druckenmiller, paul tudor jones, etc, but mostly they're like characters that are so remote it's hard to have much insight into what makes them 100x more successful than the avg finance guy my question is, who is the most successful trader you personally know, and what do you think makes them different? i'll start: family in-law is eastern european guy (literally from the old country) who runs construction company, is already financially successful before getting into trading, made major plays into REITs and property stocks & just keeps plugging away. a few things that stands out: - he's super opinionated on a few topics that's he's obsessed with, keeps talking about those few things, etc, absolutely takes no prisoners. maybe that's a function of him being a business owner in a tough industry, but he prob would stick out in a regular corporate environment - constantly reading, absorbing, watching the financial news. literally when we go over to his house, the TV screens are always on CNBC or bloomberg. he sometimes does a running commentary of what's going on - comes across as somewhat paranoid about random things. like the other day, he was telling a story how he was staying at a fancy hotel during his travels, and getting food poisoning bc the staff didn't like his attitude and had it in for him. lol, the story was funny in the moment but didnt make that much sense when i thought about it afterwards - likes to be 'comfortable'. not sure how to describe it. you know how some ultra-successful guys like to do ironman triatholons, go on extreme skiing trips, do zen meditation for the 'challenge,' not this guy...he seems to have designed his life, his house, etc, around the concept of what is most comfortable. if he wants a bowl of ice-cream drenched w chocolate syrup on top, after an already heavy dinner where there was dessert, he gets it, regardless of the missus' disapproving looks --> kinda reminds me of ed seykota's saying of how everyone gets what they want from the market; this guy definitely has no problem with unconscious self-sabotage and whatnot, he knows what he wants & takes pleasure in achieving pleasure - also quite healthy, maybe it's the genes; his mother supposedly lived to age 99
I know this guy that is 59 years old. He has traded on and off from the age of 18. He is now trading full time for the second time in his life. He never is well capitalized...prolly a good thing as he just slowly loses it. Don't get me wrong he has made a lot too and supported his family all these years. When he runs out of trading money or quits in disgust he will get a job and make it back to return. He has gone full circle now and has found some capital to trade. He lives mortgage free and is on a a cash basis and is retired. So he trades full-time as he loves trading. I do not consider him a gambler...but being "less of a gambler" might be his downfall. I think he is going to make it this time around. ES
Let's hope he doesn't end up like Livermore, didn't JL do that a few times before he gave up... please explain more? this is unexpected, as you often hear how ppl are too much of a gambler to succeed at trading (rolling the dice on random stuff where they have no edge, etc)
He leaves money on the table and does not let the market give him what it realizes. Sure nobody can trade the highs, lows and closes perfectly...but if you were to image a chart and draw those OHLC lines on it and then look at his trades it is clear that he does not let them run long enough out of fear. He see's a win on his platform and looks for reasons that it will fail to justify an early exit. His stops are fine...he needs to learn to bring those stops up or down to BE+1, 2 or 3 ticks to overcome his weakness of exiting at first profit. Being conservative is the downfall of many. Reducing the risk along the way cures this and lets the trader gamble more. Some great traders and poker players know when to trade size or wait for the move. ES
i always suspected he was front running our bond model that we were trading, which eventually killed it like public pressure killed oddball. the rise and fall of many pit traders coincided with the early trading models we and others were using. i could tell by the fills coming back something was up. they would often just ride the entries and exits our slippage was immense and that's what killed off all these scarce systems. it just got worst and worst, till we all crashed.
there was a story of how soros' quantum fund lost $60m in s&p futures in the week of the 1987 crash, when they tried shorting but their broker + 100 other floor traders reportedly colluded against them...i guess it was a crazier time
Better to become a statistician and have a bias to filter out randomness, easier to test. I was a gambler long ago but knew my stats and very similar how I trade today. Know your risk throughout the trade than just the beginning, when I am designing a new system, I have probability numbers above and below price bars and update on each tick based on charting, time, trendlines and or indicators, so when percentages goes up, I can take on more size and if they turn down take a tick on some, for me best to take "mean" profits of 65%plus then 25% off at 2nd mean and 10% runners which comes up few times a week, but stats often comes up with smaller drawdown at lower profits. Get drawdowns lower, take on more size. Build nest egg then do long terms stocks and sell options, keep the money earning. Most of those I know are very private, live way below their means and trade conservative aggressive. But always keep good paying dividend stocks and hedge them for down turns.