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Adding Rocket Fuel to Your Trading

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zac

Joined
4 March 2011
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Hi all,
This is a question of education and how to sling shot ones ability.
Ive been a trader for over a year with mixed results.

To become an expert in financial analysis, understanding trends, markets, interest rates, currencies, macroenvironment etc,

What sort of intense experience/training can I do.
There's one I know of but its not being offered anymore. It was 6 months of intense education. Writing reports on markets, making predictions for the next month. Basically becoming your own fund manager.

In other words learning from fund managers, specialists in the finance industry.

Any advice anyone has will be greatly appreciated.
 
Identify how you like to trade and what you're doing profitably.

Learn to code a charting/software package.

Search for stats.

Develop a system or strategy to know why and how you'll be profitable.

Stay profitable.
 
Thanks for the reply.
I probably didnt word my request too well.
What I mean is being able to be an analysis fundamentally, beyond the basic text book theory etc.

I guess in some ways analyse the macroenvironment like George Soros or a fund manager.
 
zac said:
Thanks for the reply.
I probably didnt word my request too well.
What I mean is being able to be an analysis fundamentally, beyond the basic text book theory etc.

I guess in some ways analyse the macroenvironment like George Soros or a fund manager.
Click to expand...

"My father will sit down and give you theories to explain why he does this or that. But I remember seeing it as a kid and thinking, Jesus Christ, at least half of this is bulls**t, I mean, you know the reason he changes his position in the market or whatever is because his back starts killing him. It has nothing to do with reason. He literally goes into a spasm, and it's his early warning sign."
””George Soros's son, Robert, on his father's Theory of Reflexivity.
Soros himself essentially went on to criticize his own theory in the next edition of the book -- admitting that it was essentially incomprehensible. Those who had claimed to have understood it in the first place were just fooling themselves.
Click to expand...

Like that? Or like this?

http://gestaltu.blogspot.com.au/2013/01/predicting-markets-or-marketing.html
100315_economics_poster_science_explaining_today.jpg
 
zac said:
I see your point,
How would I develop my aptitude to make assessments and judgements. Obviously fund managers and other experts have a knack for it as theyre well regarded.
I dont listen to news/media, that is all BS.

Ideally id love to be mentored by a broker/fund manager or similar.
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Macro strategies should really only be used when trading someone else's money. All the fund manager needs to do is to talk the talk and sound intelligent... The bet will fall one way or the other. If he's lucky he gets a big cut, if he's unlucky he gets a smaller cut.
 
skc said:
Macro strategies should really only be used when trading someone else's money. All the fund manager needs to do is to talk the talk and sound intelligent... The bet will fall one way or the other. If he's lucky he gets a big cut, if he's unlucky he gets a smaller cut.
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I dont agree with that, ive done well utilising the macro knowledge and analysis ive had so far. Anyway I guess im not getting any headway here lol.
 
zac said:
I dont agree with that, ive done well utilising the macro knowledge and analysis ive had so far. Anyway I guess im not getting any headway here lol.
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You've done well long? Since 2009? Have you beat the index?
 
CanOz said:
You've done well long? Since 2009? Have you beat the index?
Click to expand...

See I wanted to avoid this argument.
Ive traded various techniques, and Im definitely into my fundamental analysis.

Ive beaten the index doing value investing which is fundamentals from a micro perspective. However it was timing the market that helped me there not the analysis totally.
Now im saying id like to learn the macro side too as my currency, commodity trades have me intrigued and ive done real well with some, mediocre with others and crap with some too.

Its irrevelant if ive beaten the index. Im saying theyve served me well and I have faith in those techniques hence I want to get the most out of it and add 'rocket fuel' to my trading.
 
zac said:
See I wanted to avoid this argument.
.....

Its irrevelant if ive beaten the index. Im saying theyve served me well and I have faith in those techniques hence I want to get the most out of it and add 'rocket fuel' to my trading.
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What argument ?

I am confused as to what the reference is to rocket fuel if you can't beat the index.

Any average punter who is trying to use a fund manager as an example or who believes that he can become another Buffet with less than quite a few million is seriously in for a major lesson.

You are instantly in the 90% that participate in the market, rocket fuel yourself out of that group and that mentality if you want to stand a chance of beating the index (assuming that you want to) rather than quoting belatedly delivered touchy feely numbers that have long ago been acted on.

Been there, done that, still have the T shirt :banghead:
 
LOL yeah,
We've gone off subject here.

The rocket fuel reference was merely commenting on propelling things forward.
Anyway what I was after was advice on learning more about markets etc, getting to a point where im highly skilled and unconsciously competent.

At the moment I subscribe to a video and newsletter of a former fund manager. He uses a macro approach and achieves about 60% pa. I think he'd agree that he'd never achieve that in a multi-million dollar fund. Being a small fish has its advantages.

Im not saying I can do this but I do beleive beating the index isnt hard. Roger Montgomery has said the same recently too. Most people limit their trading not with their skills but with their mindset.
 
chops_a_must said:
First things first...

Are you trading, investing, managing or speculating? :confused:
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LOL i had this argument with the ATO recently hehe.
To them I am an investor. I have a portfolio on the ASX which I buy and hold through value investing. That is doing well.

For the past 12-24 months ive been getting into global markets, ie currencies, commodities, bonds, etc and making trades/investments via fundamental analysis.
I understand most people would trade these via technicals however.

My trades will last for weeks/months. ie a recent one I held for over a year was USDJPY.
 
Zac,

Any advice anyone has will be greatly appreciated
Click to expand...

You have been asking about this for over a year, you started this thread...

https://www.aussiestockforums.com/forums/showthread.php?t=24416&p=688670#post688670

You still seem to be needing a mentor, or a crutch to hold onto, rather than use your own judgement. The advise for a fundamentalist rocket fuel approach would be read read read annual reports from years ago, then see what happened next to the companies. Then see if the same type of parameters worked in different macro conditions over years.

The answer is research and work, not a crutch and whilst you continue to search for said crutch you will wander in the vast trading wilderness of the lambs.
 
Yeah thats true,
I did ask a year ago, :)
Well spotted.

I just know the importance of a mentor to someone but reading and reading is important too.

Im just relentless in my search and am rather passionate about trading.
Education never ends and I'll never be someone that admits they know everything there is to know about a topic.
 
zac said:
Yeah thats true,
I did ask a year ago, :)
Well spotted.

I just know the importance of a mentor to someone but reading and reading is important too.

Im just relentless in my search and am rather passionate about trading.
Education never ends and I'll never be someone that admits they know everything there is to know about a topic.
Click to expand...

Well Zac you have a supporter in a techi

I also find Macro economics fascinating.
Of course with Macro economics you'll get massive diversity in long term economics.
So it's pretty easy to form a view.
Bullish ---- perhaps Plunkett
Bearish ----- perhaps Dent.
But your 12 mth USD/JPY is indeed impressive.

I agree that there will be fantastic long term macro moves which if you can get on them and
Add and ride them can give life changing returns.
Gold
Oil
AUD
Long indexes ---- going forward short indexes!.
Both of the above have websites and newsletters
Continue your search and please post your results ( who you find ) from time to time.

I think you are very wise in your approach.
You may be interests in the read
" Investing in the age of Sovereign Defaults "
Peter Treadway. I get a lot of titles from
" The Educated Investor " in Melbourne.
 
zac said:
Yeah thats true,
I did ask a year ago, :)
Well spotted.

I just know the importance of a mentor to someone but reading and reading is important too.

Im just relentless in my search and am rather passionate about trading.
Education never ends and I'll never be someone that admits they know everything there is to know about a topic.
Click to expand...

Economics ? ;)

http://www.open.edu.au/courses/business/units-list-ugrd-eco

But seriously

In the last week Zac I have been diggin through a treasure trove of information here
http://pages.stern.nyu.edu/~adamodar/

I ended up there in the last week after seeing a recommendation from Craft. It is a gold mine, I definitly encourage you to dig it, in fact I think it may be just what your after! **** me everything this guy teaches at NYU is on his website, I think this is exactly what you are looking for, as it is what I was looking for ... and its free! (start with his 'research and papers' section imo you will be impressed) Or you can just do the entire corporate finance and valuation classes he teaches at Stern for free .. everything is on his website there

For anyone who wants to have it confirmed (like we didnt know already) that Roger Montgomery is a bit of a clown with his ROE valuation model ... go here http://pages.stern.nyu.edu/~adamodar/ click on 'research and papers' on the left hand side, and then under the section "Estimation Issues in DCF Valuation" bring up the research paper on "Measuring Returns: ROE, ROC and ROIC"
 
Hi tech/a and RandR,
Im humbled by your responses :)

Thanks for the advice.

And tech/a one thing im learning is patience is a virtue lol but its so hard to keep under control.
Im hoping I can make a nice play on all this QE / money printing.
After all for every action there is a reaction ..... im sure its coming ;)
 
Yes.

MOOCs are pretty awesome.

Worthy of its own thread for finance and markets in this forum.

Cheers.
 
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