A world that’s more riot than profession, the trading floors of Chicago are a place where gambling your family’s mortgage is all in a day’s. At a time when markets are unhinged, FLOORED offers a unique window to this lesser-known world of finance. These men may not have degrees, but they’ve got guts, and penchant for excess that solicits simultaneous feelings of revulsion- and a desire to root them on. But like many aspects of our economy, technology is changing the way these traders do business, and these eccentric pit denizens aren’t the type to take kindly to new tricks. Computerized trading may take the emotion out of the job, but it may also take some of these old-timers out- dinosaurs in a young man’s game.
Archives of “guts” tag
rssCourage and Trading
According to Plutarch, “Courage stands halfway between cowardice and rashness…” Clearly, we don’t want to be reckless; and clearly, we don’t want to be hesitant and timid. What we need is a balance. As we go about our trading moderating our greed and our fear to a combination of healthy desire and clear minded caution, we use courage to go forward.
Courage doesn’t mean closing your eyes, holding your nose, and jumping into the deep end. It does mean moving forward with clean and clear perception as well as steadfastness of purpose.
You don’t need courage if you’re totally confident and unafraid. Courage, according to John Wayne, is being scared to death and saddling up anyway. Because people tend to fear the unknown, and the unknown is all that is certain about any given trade, we need to employ courage. Since trading is always new, since anything can happen and it often does, since the wildness lies in wait, we need to overcome uncertainty and fear so that we can appropriately enter, exit, and remain in trades.
When asked what he meant by “guts”, Ernest Hemingway told Dorothy Parker in an interview “grace under pressure”. Trading is all about grace and gracefulness under pressure.
The good news is that courage is like any muscle. It grows and becomes stronger the more you use it. Often as I trade I’m unaware of utilizing courage. I know I’m extremely alert. I may even be excited. I’m not aware of any fear until something starts to go wrong. However, that alertness and excitement is a product of adrenalin running. Excitement or fear comes from the interpretation you give to the adrenalin high. The more you act as if you’re unafraid, the less afraid you become. It all gets easier. Act the part and become the part. Make it your goal to trade with increasing grace under pressure.
The difference between excitement and fear depends of what you are imagining.
Are you imagining loss or are you imagining profit? Of course, you always have to keep the alternative in mind as trading is all about balancing the alternatives, profit with loss. But you don’t have to put loss into the foreground of your mind, because you never would put on a trade unless profit was the probable outcome. Direct your imagination towards profit, and suspend all thoughts of loss–once you’ve put your stops in.
“Don’t cry before you’re hurt.” says a proverb. I would add, don’t mourn a loss before you experience it. Don’t even mourn it after you take it, get on with the next trade, and the next, and the next. Anticipate profit. That’s what you’re there to experience. Ah yes, and as another proverb states: “Fortune favors the brave.”
Ignore Your Guts
In my studies I have often found something that is rather interesting and maybe different than most would suspect. The most successful traders I have studied don’t rely on gut calls or feels, but rather adhere to a disciplined set of rules or guidelines and are humbled enough to admit that their emotional decisions aren’t consistent enough to hold up during the heat of the moment.
Ironically, most would think just the opposite that the more successful a trader is, the more ‘feel’ he or she has or the more ‘instinct.’ Sure, it looks macho to make calls or predictions and when proven correct a person is often praised and viewed as having some superior knowledge, but in reality these people are one step below those that have already moved through this stage and left it behind.
As an individual trader it is simply impossible to remain emotionless, making the proper trading decisions at all times, when the action is heated. Even when there is a lull, our emotions kick in and we feel a change is needed or something should be done, when in reality our rules may say to stay put or do nothing.
Guts to SHORT at Peak…. Glory to Instant Profits
Dear Readers, Today morning I wrote 5077 as Peak NF possibility for the day. It went upto 5072 only. Sensing its failure here, my Message to all Subscribers: Now, at 5065…. Short NF with a Risk of Rs.13. Below 5055 it will tumble upto 5004. Within minutes NF tumbled to 5006. Instant gain of 59
In the same message: Now at 1075, Sell RIL with a stop of 1086-1092. Reliance just in Minutes slid from 1077 to 1056, nearest to its day’s low 1053
At opening bell :Catch Bharti above 289.50 for supergains tgt 297 ,303.50 (It kissed 302)
The point tobe noted here is: Shorting at the peaks. Its possible only when I am committed in my market analysis work at the bottom of my heart. My Levels mentioned in the web-site are the same but my MESSAGES at the right time will trigger action to subscribers for grand gains, unhesitant to Short too which is a rarity.
Just Follow Levels, Make your Vallets Deep, Deeper, Deepest
Join us live during trading hrs and get Intraday live calls of Nifty Future/Stocks.
Courage and Trading
According to Plutarch, “Courage stands halfway between cowardice and rashness…” Clearly, we don’t want to be reckless; and clearly, we don’t want to be hesitant and timid. What we need is a balance. As we go about our trading moderating our greed and our fear to a combination of healthy desire and clear minded caution, we use courage to go forward.
Courage doesn’t mean closing your eyes, holding your nose, and jumping into the deep end. It does mean moving forward with clean and clear perception as well as steadfastness of purpose.
You don’t need courage if you’re totally confident and unafraid. Courage, according to John Wayne, is being scared to death and saddling up anyway. Because people tend to fear the unknown, and the unknown is all that is certain about any given trade, we need to employ courage. Since trading is always new, since anything can happen and it often does, since the wildness lies in wait, we need to overcome uncertainty and fear so that we can appropriately enter, exit, and remain in trades.
When asked what he meant by “guts”, Ernest Hemingway told Dorothy Parker in an interview “grace under pressure”. Trading is all about grace and gracefulness under pressure.
The good news is that courage is like any muscle. It grows and becomes stronger the more you use it. Often as I trade I’m unaware of utilizing courage. I know I’m extremely alert. I may even be excited. I’m not aware of any fear until something starts to go wrong. However, that alertness and excitement is a product of adrenalin running. Excitement or fear comes from the interpretation you give to the adrenalin high. The more you act as if you’re unafraid, the less afraid you become. It all gets easier. Act the part and become the part. Make it your goal to trade with increasing grace under pressure.
The difference between excitement and fear depends of what you are imagining.
Are you imagining loss or are you imagining profit? Of course, you always have to keep the alternative in mind as trading is all about balancing the alternatives, profit with loss. But you don’t have to put loss into the foreground of your mind, because you never would put on a trade unless profit was the probable outcome. Direct your imagination towards profit, and suspend all thoughts of loss–once you’ve put your stops in.
“Don’t cry before you’re hurt.” says a proverb. I would add, don’t mourn a loss before you experience it. Don’t even mourn it after you take it, get on with the next trade, and the next, and the next. Anticipate profit. That’s what you’re there to experience. Ah yes, and as another proverb states: “Fortune favors the brave.”
Ignore Your Guts
In my studies I have often found something that is rather interesting and maybe different than most would suspect. The most successful traders I have studied don’t rely on gut calls or feels, but rather adhere to a disciplined set of rules or guidelines and are humbled enough to admit that their emotional decisions aren’t consistent enough to hold up during the heat of the moment.
Ironically, most would think just the opposite that the more successful a trader is, the more ‘feel’ he or she has or the more ‘instinct.’ Sure, it looks macho to make calls or predictions and when proven correct a person is often praised and viewed as having some superior knowledge, but in reality these people are one step below those that have already moved through this stage and left it behind.
As an individual trader it is simply impossible to remain emotionless, making the proper trading decisions at all times, when the action is heated. Even when there is a lull, our emotions kick in and we feel a change is needed or something should be done, when in reality our rules may say to stay put or do nothing.
Decisiveness
“It’s better to be boldly decisive and risk being wrong than to agonize at length and be right too late” – Anonymous
“Procrastination in the name of reducing risk actually increases risk” – Colin Powell
“Take time to deliberate, but when the time for action has arrived, stop thinking and go in” – Napoleon Bonaparte
“In any moment of decision, the best thing you can do is the right thing, the next best thing you can do is the wrong thing, and the worst thing you can do is nothing” – Theodore Roosevelt
If you have the patience to wait for your setup then you better have the decisiveness to GET IN THE TRADE once price comes to you and your entry parameters are present. How many people wait for the trade to come and then when it arrives start analyzing if they should take it? When the trade has arrived it is time for action, not analyzation. This is what preparation is for. If you have done your homework there is no need for hesitation – you already know what to do. At the same time trading is not static. There are times when the odds are high that the market will reverse before your final target is hit. Do you have the decisiveness to reverse the position or flatten when this situation is present? It has been said that the number one ingredient to being a great trader is the trading guts to pull the trigger as soon as a reverse is anticipated. Be decisive.
Investment Jokes
The Godfather, accompanied by his stockbroker, walks into a room to meet with his accountant. The Godfather asks the accountant, “Where’s the three million bucks you embezzled from me?” The accountant doesn’t answer. The Godfather asks again, “Where’s the three million bucks you embezzled from me?”
The stockbroker interrupts, “Sir, the man is a deaf-mute and cannot understand you, but I can interpret for you.” The Godfather says, “Well, ask him where the @#!* money is.”
The stockbroker, using sign language, asks the accountant where the three million dollars is. The accountant signs back, “I don’t know what you’re talking about.” The stockbroker interprets to the Godfather, “He doesn’t know what you’re talking about.”
The Godfather pulls out a pistol, puts it to the temple of the accountant, cocks the trigger and says, “Ask him again where the @#!* money is!”
The stockbroker signs to the accountant, “He wants to know where it is!” The accountant signs back, “Okay! Okay! The money’s hidden in a suitcase behind the shed in my backyard!”
The Godfather says, “Well, what did he say?” The stockbroker interprets to the Godfather, “He says that you don’t have the guts to pull the trigger.”
The Pessimist sees the glass as half empty. The Optimist sees the glass half full. The Stock Market Day Trader JUST ADDS WHISKEY …
Market statistics are like a bikini:
What they reveal is important, what they conceal is vital!
With $1 Trillion In Loans, The ECB Is The Biggest Guarantor Of European Banks
Today’s lower than expected interest in the 3-month LTRO operation was supposed to indicate a sign of stability for European banks. Nothing could be further from the truth. In an article which recaps a variety of data points presented here previously, the FT summarizes that European banks continue to exist solely due to a record and unprecedented $1 trillion in emergency loans issued to Europe’s commercial banks. In turn, almost 40% of this liquidity is then recycled, and stored back with the ECB, as the very same banks have no trust whatsoever in any of their peers. In short: no matter what the Stress Tests indicate, the European financial system is now in a worse condition than ever in history, including the days just after Lehman.
From the FT:
The ECB is currently lending close to €900bn ($1,098bn, £728bn) to eurozone commercial banks, jumping to near-record levels since the creation of the central bank 11 years ago. This now matches cross-border lending between commercial banks in the 16-nation currency zone, according to JPMorgan.
Although lending between domestic banks represents the lion’s share of the estimated €6,300bn market, the ECB has become essential as a lifeline to the weaker of the 3,000 banks in the eurozone.
At least some people still have the guts to laugh in the face of JCT’s propaganda:
Paul Griffiths, global head of fixed income at Aberdeen Asset Managers, says: “Without financial support many banks would struggle. It would take a brave man to turn the ECB taps off.”
Summarizing just how critical the ECB’s role is in the proper functioning of European banks:
Since Lehman Brothers collapsed in September 2008, lending by the ECB to eurozone banks has risen sharply as it has offered unlimited loans and extended its liquidity operations. This has seen the sum it lends to the banks rise from about €500bn before the Lehman crisis to today’s near record levels.
As well as the offer of unlimited loans, the ECB has bought €55bn in eurozone government bonds and €60.2bn in eurozone covered bonds in an effort to revive the eurozone economy and boost sentiment.
However, fear still stalks the markets. Interbank dealers say credit blocks remain on Spanish and Greek banks because they are seen as too risky to lend to.
The fear of lending to other banks because they may fail to repay loans is also reflected in the large sums of cash being deposited at the ECB overnight.
In spite of offering only 0.25 per cent for deposits, commercial banks parked €305bn at the ECB on Monday night because they prefer the safety of placing their money with the central bank rather than lending to other banks at higher rates. Before the Lehman crisis, overnight deposits at the ECB were typically less than €10bn.
And a pretty chart showing just how contrary to fact are all European claims that all shall be well.
At this point it is worth reminding that the Fed is a paragon of transparency and openness when compared to the infinitely more nebulous ECB. One thing that can be assumed with certainty for both central banks, however, is that this $1 trillion+ in cash lent out is backstopped by some of the most toxic paper in existence. The collateral received in exchange for the cash, which in turn forms the asset side of the ECB’s balance sheet, is also the guarantor of the money in circulation in the eurozone, and is the implicit baker of the value of the Euro. Next time you wonder why more and more people are calling for EURCHF parity, keep in mind that almost a hundred billion in Greek bonds is just part of the worthless recourse backing that piece of paper in your transatlantic wallet.