# Now thats CLASS!



## nizar (11 June 2007)

Bill Lipschutz
Beginning with $12,000 left to him by his grandmother, he built it up to over $250,000 in four years. For eight years he worked for Salomon Brothers and it is estimated that during this time he was responsible for in excess of one-half billion dollars. 

Bruce Kovner
May well be the world's largest trader in the inter-bank currency and futures markets. In 1987 alone, he scored profits in excess of $300 million for himself and the fortunate investors in his funds. Two thousand dollars invested with Kovner in early 1978 was worth over $1,000,000 ten years later. 

David Ryan
In 1982 he began working for William O'Neil and in 1985 achieved a degree of fame when he won the US Investing Championships held by Stanford University Professor Norm Zadeh, where he returned a phenomenal 161 percent for the year. He followed this up with a 160 percent return in 1986 and another triple digit return in 1987. For the three years as a whole his compounded return was a remarkable 1,379 percent. 

Ed Seykota
One of the best traders of our time. Realized an astounding 250,000 % return on his accounts over 16 years. (normalized for withdrawals, the account theoretically was up several million percent) 

Gary Bielfeldt
Starting with $1,000 and only able to trade one contract, his success (trading size) became so great that he had grown to the point that government established speculative limits became an impediment to his trading. 

Marty Schwartz
Has scored enormous percentage gains in every year since he turned full time trader in 1979, but he has done so without ever losing more than 3 percent of his equity on a month-end to month-end basis. In the US Investing Championships held by Stanford University Professor Norm Zadeh his performance was nothing short of astounding. In nine of the ten four-month trading championships he entered, he made more money than all the other traders combined. His average return in these nine contests was 210 percent - non annualized! In his single entry in a one-year contest, he scored a 781 percent return. 

Michael Marcus
Over a ten year period, he multiplied his company account by an incredible 2,500 fold. He turned a $30,000 account into $80 million. 

Michael Steinhardt
One thousand dollars invested with him in 1967 grew to over $93,000 by 1988. To put it in perspective the same $1,000 invested in a basket of S&P stocks would have only grown to $6,400. 

Monroe Trout
Over a five year period he has averaged a return of 67 percent, astoundingly his lowest drawdown during this period was just over 8 percent, with profitability being registered for 87 percent of all months. 

Paul Tudor Jones
Has accomplished what many though impossible: combined five consecutive, triple-digit return years with very low equity retracement. Took a $1.5 million account in 1984 to $330 million account in 1988. 

Richard Dennis
Began with $400 and turned it into a fortune estimated to approach $200 million. Perhaps the best-known futures speculator of our time. 

Tony Saliba
Strung together seventy consecutive months of profits exceeding $100,000. Only the rare trader can boast both occasional dramatic gains and consistent trading profits. 

William O'Neil
In 1962 he pyramided profits in three exceptional back-to-back trades and parlayed an initial $5,000 investment into $200,000. 

http://members.aon.at/tips/citation.html


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## petervan (11 June 2007)

Expect to see your name in that list in the next few years Nizar.No pressure


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## nizar (11 June 2007)

petervan said:


> Expect to see your name in that list in the next few years Nizar.No pressure




Haha.
Yeh i really hope so.
I mean, alot of these guys didnt start with a lot of capital, which is seen by many as an obstacle, i guess thats difference between the crowd -- and the true champions.

I like in particular what Michael Marcus has done.

Paul Tudor Jones nice, but i dont quit have $1.5mil, yet


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## nizar (11 June 2007)

One was Michael Marcus, a former trader at the New York Cotton Exchange, who went on to become one of the world's biggest currency speculators. He made a fortune in gold and another fortune in cocoa before moving into trading tanker rates and other indices in the shipping industry. He parlayed a thirty-thousand-dollar stake into an eighty-million-dollar fortune. He owned ten houses in every beautiful place in the world, many of which he had never slept in. 

His wife left him, but Marcus was too busy to notice     Trading from a beachside mansion in California, he was waking up every two hours throughout the night to place three-hundred-million-dollar bets on currency markets in Australia, Hong Kong, Zurich, and London. His secret? Marcus is a chartist. *He is a trend follower *who keeps an eye on market penetration and resistance.

From Thomas A Bass, in the book The Predictors: How a Band of Maverick Physicists Used Chaos Theory to Trade Their Way to a Fortune on Wall Street


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## tech/a (11 June 2007)

Nizar.

You'll get facts like these in all areas of *Business* (trading is/should) be treated as a business.

Some have incredible success starting with nothing.
Many fail---then try again--fail once more and try again.
Some start with considerable sums then build them to fantastic sums---Kerry Packer and now son James.

With 99% of truely fantastic success stories I have found that in the end its the ability to be Entrepenurial which sorts the "Joe Averages" out from the truely successful.

Many traders will only ever have the "Deli" type business returns.
Few will be come the Packers in this business.

Somewhere in between will suit most of us just fine!


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## nizar (11 June 2007)

tech/a said:


> Nizar.
> 
> You'll get facts like these in all areas of *Business* (trading is/should) be treated as a business.
> 
> ...




Yeh true the beauty of trading is that its a noncapital-intensive business (lol actually it can be if you lose money! LOL), what i mean is that start up cost can be minimal, yet you can still do well.

Property development many people prefer it but you need more than a few Gs to start.


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## Trembling Hand (11 June 2007)

It would be nice to see these kind of achievements recognized as the goal by non-traders rather than a skeptical look and some remark about its all just gambling. It would seem to involve just as much work talent and dedication as any sporting achievement.


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## tech/a (11 June 2007)

nizar said:


> Yeh true the beauty of trading is that its a noncapital-intensive business (lol actually it can be if you lose money! LOL), what i mean is that start up cost can be minimal, yet you can still do well.




Reminds me of the old saying.
"To become a specialist in small business start with a LARGE one!



> Property development many people prefer it but you need more than a few Gs to start.




Yes true but undercapitalisation makes the task of trading harder for most.
If they invested as much as they could or do in housing their returns would generally be better.

Easier to make a 20% profit a year from $250,000 than 
1000% from $5000

Same return different capital base.


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## BSD (11 June 2007)

While we admire these great results from many who are deserved - remember that every week some idiot wins a $1,000,000 beating the odds on a 1-48,000,000 bet on the lotto. 

Dont be fooled by randomness...

http://www.amazon.com/Fooled-Randomness-Hidden-Chance-Markets/dp/1587990717


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## Pommiegranite (11 June 2007)

BSD said:


> While we admire these great results from many who are deserved - remember that every week some idiot wins a $1,000,000 beating the odds on a 1-48,000,000 bet on the lotto.
> 
> Dont be fooled by randomness...
> 
> http://www.amazon.com/Fooled-Randomness-Hidden-Chance-Markets/dp/1587990717





"idiot?" 

Please quantify your reasoning behind referring to a lottery winner as an "idiot". 

Disclaimer: I have not won the lottery although I maybe an idiot.


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## wayneL (11 June 2007)

BSD said:


> While we admire these great results from many who are deserved - remember that every week some idiot wins a $1,000,000 beating the odds on a 1-48,000,000 bet on the lotto.
> 
> Dont be fooled by randomness...
> 
> http://www.amazon.com/Fooled-Randomness-Hidden-Chance-Markets/dp/1587990717



I was thinking along the same lines myself.

While skill and knowledge is important, never underestimate luck in business/trading when staring from a small capital base.

I have a mate who works at MacBank as a private client adviser who is doing obscenely well. Started with nothing, but the week he started, one of their senior advisers retired and GAVE may mate his book of clients. He has kept them all, developed good relationships, does a good job etc, but to be honest, he doesn't know a lot.

Skill or luck? 

He had to put himself in the situation to get the luck, but there is still luck involved.

It's a bit of both usually, but some are just lucky. (and I can prove it with excel)


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## It's Snake Pliskin (11 June 2007)

Not being a sheep is the secret.

Most would not step out of line to be deliberately different. Religious doctrine dampens the real human spirit and look what we have.

In my case I devoted time to knowing what it is. Luck may play a part, and randomness depends what type of randomality we are talking about - fierce or benine?

Some bull market champions are trading with minimal funds and making a living. When we have little interest they will find it hard, because they are usual and predictable. 

I believe any human has the ability - not the attitude.


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## BSD (11 June 2007)

Pommiegranite said:


> "idiot?"
> 
> Please quantify your reasoning behind referring to a lottery winner as an "idiot".
> 
> Disclaimer: I have not won the lottery although I maybe an idiot.





The lottery is a tax on people who can't do maths. 

The odds of getting 6 from 6 out of 48 is 1 in 8 million 

The payout per $1 invested is generally far less than $8 million (i dont follow it - so dont know what one bet costs)-   the payout overall is about 60% which is the biggest mug game I can think of.

Anyway - playing lotto is far worse than playing pokies. 

It is just easier to giggle at Pokies players because they do it in public

http://www.smartgambler.com.au/lotto/intro.html

Wayne makes an excellent point too. Many people make massive sums without being smart, deserved etc. 

But at least many of them put themselves in the position to do so. Risking nothing will guarantee you a 0% return - but the smart people try to at least enhance their odds. 

The odds of getting rich working on a trading floor for an investment bank are superior to those playing in the TAB against a 15% overround.


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## nizar (11 June 2007)

wayneL said:


> Skill or luck?
> 
> He had to put himself in the situation to get the luck, but there is still luck involved.
> 
> It's a bit of both usually, but some are just lucky. (and I can prove it with excel)




I heard a saying once.
The harder you work, the luckier you get.


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## wayneL (11 June 2007)

nizar said:


> I heard a saying once.
> The harder you work, the luckier you get.



Different concept.

That is a retort for muppets who look at someone who has worked smart and hard to get where they are, and call them lucky b@stards. Very pertinent in the intended context.

But let's take 100 trend traders. All have identical systems, capital, psychology, blah blah. Some will massively outperform the others. Some may even make losses with a supposedly positive expectancy system.

Why? How?

It is because each will choose different stocks from the oversupply of identical signals generated. By luck, some will pick upside black swans, some will jag several. Others will pick downside black swans, some will cop several.

The winners will attribute their success to their superior skill, but in reality, this is nohting more than a cognitive bias. Remember, everything else is equal.

Never underestimate luck.


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## Sprinter79 (11 June 2007)

nizar said:


> I heard a saying once.
> The harder you work, the luckier you get.




I prefer the one that goes something like this: 

"You work hard to put yourself in a position to take advantage of any opportunities that come your way."

Luck may or may not be part of that, but, if you can take advantage of a situation, and turn it into a positive for youself, you'll come out ahead. Works for life in general, not just the markets.


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## JeSSica WaBBit (11 June 2007)

Agree with you Sprinter 100%,

First to have to do the research and find the investment that is going to make you the money, 

Second you have to have the balls to back yourself in, 

Third, when you back yourself in you have to know when you have got it wrong and have a plan to get out before your loses become too great, 

Fourth, you have to follow a plan or strategy to ensure you maximise your profit

Fifth, you have to have an exit plan otherwise you sit and watch them go up and come back down again

Six, you may get some luck along the way, but is it luck or is it just that you picked an investment with good fundamentals and what is seen as luck by others in fact is what you saw as the reason for it to increase your wealth. 

As others have said, those who make lots of money see things that others are blind to

When i recently purchased my Cue Energy Resources shares two people told me that it was a stupid move and asked why i would invest in 'that' company.

Now that i am 65% up in six months they call me lucky, i disagree!

It took balls to buy them with the negativity i had around me but, thats what seperates the winners from the others, you got to do your reasearch, be in touch with your investment and have the guts to back your self in.

Thats how i see it............................


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## wayneL (11 June 2007)

In consideration of these concepts, one should be aware of cognitive biases that may affect how we think about our success or otherwise.

http://en.wikipedia.org/wiki/Cognitive_biases



> Decision-making and behavioral biases
> 
> Many of these biases are studied for how they affect belief formation and business decisions and scientific research.
> 
> ...


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## nizar (11 June 2007)

Wayne.
How did you go with that book, way of the turtles?


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## Wysiwyg (11 June 2007)

Those cognitive biases sure are a long way from a simple yes or no.


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## clowboy (11 June 2007)

tech/a said:


> Reminds me of the old saying.
> "To become a specialist in small business start with a LARGE one!
> 
> 
> ...




Better to make 1000% from a $250,000 capital base


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## Boyou (11 June 2007)

This seems to be the topical forum of the day.Lots of Food for thought here.


I wonder if any of the posters have read Bonner and Wiggins "Empire Of Debt"

Bonner Publshes a weekly E Letter Titled Daily Reckoning.I relate to his style and his (slightly ) eccentric views.Here is a sample......

Cheers Ya'll

Do unto others…thou shalt not kill…buy low, sell high…

Never give a sucker an even break.

Values count. In the end, they're all you have.

Now, let us ask you a question, dear reader. If you could know what the future would bring, why would you bother with values?

Let's say you found a stock with a low price, superb management, great margins, no debt, and a product that was catnip to consumers. You would want to buy it, right? Because it would represent a real value to you.

But if you could read next year's paper, you wouldn't bother. You'd simply look to see which stock ran up the most in the last 12 months. You wouldn't fool around with values.

And in your god-like state, you wouldn't have to bother to do unto others as you would have them do unto you, either. You could do whatever you wanted, because you would know how it would all turn out.

Remember, that's what the gods themselves did. They were always getting up to mischief - turning people into animals to punish them, turning themselves into animals so they could rape a few nymphs…generally behaving badly, but apparently having a good time at it. They did it because they were gods; they could get away with it.

Thou shalt not kill? Hey, what's it to me? I'm a god…I can kill whomever I please.

Buy low, sell high? Nah…I'll just buy what will make me richest.

Never give a sucker an even break? What the heck, I'll just look into the future and see what the sucker can do for me.

Gods can get away with murder. But we humans really can't know what will happen. And even if we could take a guess, we wouldn't know what to make of it. Is it good? Or is it bad? Who can know God's Own Plan except God himself?

That's why we humble Daily Reckoners stick to reckoning values. We can guess about the direction of things. We can amuse ourselves with our theories…overpower our opponents with our arguments…and impress each other with our logic. But in the end, we have to stick with values…or we are lost.


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## It's Snake Pliskin (12 June 2007)

It's rubbish and god doesn't exist.

Wayne,
Thanks for the biases you posted.


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## nizar (14 June 2007)

Oh and i forgot to add -- these guys (in post#1 of this thread) are all mechanical traders


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