Jan

18

The appearance of the stock ticker machine in 1867 removed the need for traders to be physically present on the floor of a stock exchange. Speculation underwent dramatic expansion, and with the connection of the internet boundless expansion occurred. Basically, speculation to me means higher risk investment that turns over rapidly. The coin is not in the air long. Another characteristic of speculation is that it's a judicious process of learning which makes it an intellectual competition. The market is like a gigantic chess tournament.

Traders then are a set type with traits, or they generally fail. They are usually competitive, individualistic, romantic, capable of bearing risk, athletic, of an addictive nature, scholarly, analytical, and good with numbers.

As a kid perhaps you recognized patterns in your stamp collection or on the baseball field, and sat alone in trees in independent thought analyzing them for the outcomes. You were passionate but rational, and one day went out on a limb to the idea of trading in the markets. Perhaps you had a mentor, or came up the harder way via books and trial and error which fosters patience. You were smart to start out small, and parlayed a stake into larger trades that afforded an augmentative income with dreams of diving full time into the market.

As a fish, to amphibian, to reptile in the market you've done what everyone else has – studied the books, surfed the websites, made some trades, attended a couple of seminars; and then one day it hits you like a ton of bricks - knowledge is power. The more knowledge the more power. However, infinite knowledge is limited by the time to learn it, so you map a plan to first study the central ideas to your trades, and expand from that nucleus outward. And you win.

As the information snowballs and interconnects a second paradigm arrives – I'm not thinking about a hunch or gut feeling. It's not about a trend or percentage game. You will predict the future by thinking. Think, think, think accurately. It gets to be a habit wherever you go. If you think fast you will be first.

One evening you look in the mirror and see a thinking guy or gal who has it all. There are facial creases of frowns and joy, but mostly the latter. That's when the third epitome shatters the glass – it's all about decisions. You keep right on making them even when you don't need to. You get into a what if thing, and start speculating about what you would do if some problem was yours instead of somebody else's.

Trading is a dual major in liberal arts and math. The former provides overview, but math is where you are measured and the ruler of your percentage success. The poetry of math, statistics, govern your choices.

The idea of going up against huge funds on an immense board finding ways to beat them is a real high. The rolls and swells at home become secondary to the lows and highs at the market. Little David vs. an illuminated Goliath and getting rich off the battle.

What you do next is decide to trade full time or not. The general guidance is to try anything new without burning bridges. As a full time trader, you're information is vast, thinking habit is hard, decisiveness is always near, and it doesn't matter how fast the market moves and changes, you're on top of it with a select few.

They are squeezed through the rollers of pressure. Ultimately you must have in your nature the trigger to pull under stress situations. The brighter they burn, the hotter you get.

There are many good analysts in the markets, but because of two Achilles heels few of them are able to translate their analytical prowess into profitable speculation: They must learn to walk away from a bad trade, and to avoid financial greed. There's nothing wrong with breaking Ft. Knox after Ft. Knox, but one day you will make substantial money to discover there are other challenges that speculation may support.

There is not time for romance and coffee now; this isn't a Louis L'Amour novel.

The summit of speculation is scantily populated by those who became high rollers from meager beginnings who play the market hard to win and learn rather than create surplus cash. The real thrill is working the game itself, like a kid on a perpetual peak experience. Turning the math into money, watching the bank grow without breaking character.

If you are original and creative but also a rational thinker, you may have what it takes to get on the road to speculation. Remember that experience counts for more in this profession than most, and paper trade at first, then graduate to trading with minimal funds, and scale up as your training, experience and resolve heighten like a professional athlete.

Success in speculation is a metaphor for achievement of self.


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3 Comments so far

  1. Rick Nadeau on January 23, 2016 4:53 pm

    Would greatly appreciate talking to you about my new acquaintance J. Hydrick from Coalinga. I believe you may have some information that may be interesting to listen to.

  2. Rick Nadeau on January 23, 2016 4:56 pm

    PLEASE FEEL FREE TO CALL ME AS WELL AT (916)549-2262. Today is January 21, 2016. Thank you.

  3. Kelvin D. Meeks on January 24, 2016 4:59 am

    Mr. Keely,
    Thank you for taking the time to write this posting - enjoy reading your posts always - but this one, by far, more so than all the rest.

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