Back from the Dead
This post is also available in: Japanese
Winter is the season of death, and it was all I could do to survive this past one. Our compulsions to work and eat the way we do in warmer and healthier times always seems to conspire against us during the coldest months, leaving us sniffly, feverish and bedridden. I suppose either we choose rest or nature chooses it for us – or at least so it was for me in February, the worst part of the Tokyo winter.
But from every death comes new life, and the opportunity for that life to be better than the one that preceded it. Eventually, though too late, I listened to the dictates of the shorter days and scaled back my expectations for what I should produce, content to teach and play with little bbl. And with the introspection the extra bed time afforded me, I feel better prepared for the next time the sun sinks to its depths in the southern hemisphere. More than that, I feel ready, if not yet quite rested, to crack into this year’s production. Ideas blossom in my head like so many sakura, whose fleeting presence serves to remind us to seize the moment before the next season of death consumes us.
And with that, I present my first project of the year, the newly published “Trading for Survival”, recounting all that I learned on and off the trading floor in my many years in finance (click here for the preview version). Funny, feels like not too long ago I just started spring cleaning last year – this book was item #2 of 7 from that to-do list – and here it is next spring already! Having a child will do that to you, I suppose.
Nonetheless, it is good to cross this item – which has been hanging over my head ever since I left finance – off the list. It was a labor of, well, labor – hard to tack “love” on to anything to do with the markets. And nothing like the labor my one and only went through, either with our child or with waiting for me to finish this book. Thanks to her, for standing by me as I waffled around on other projects and eventually saw this one to its close. Thanks to Joe Smith, for making the cover and for reading/editing the book line-by-line with me over the phone. Thanks to friends, family, and former colleagues who took the time to read, review, and send thoughtful feedback on the work. It was a great experience and exercise in writing, and helped me tick off one of those bucket list items – to write my very own book.
I like how you included the Myers-Briggs test as a factor affecting a person’s trading acumen and appetite for risk. As an ENTJ, I know all to well about the mental and physical rush you get from activities that are risky.
I’d also like to add that I think the feeling a trader gets from earnings has a lot to do with his level of personal content and “groundedness”. Like for one trader, perhaps a 3-5% gain per stock is good enough for him to pull out, whereas others prefer higher gains. This is probably where factors like financial upbringing and humility and knowing the value of money and how hard it is to earn it, come into play.
I used to trade in the Philippines as well, but I realized that it wasn’t fun competing against traders with inside knowledge of what will happen in the stock market. At least in the Philippines, maximizing profit as a trader relies more on connections than your fundamental and technical analysis skills. >_<
Hi Mitsu – at the time I was writing most of the book I was big into the Myers-Briggs character typing. I find it less informative as I continue to learn about human psychology but it is still useful in the trading framework, if only to tell most people to stay well away from day-trading for a living. I’m INFP by the typing system, which means I should be a terrible day trader – averse to both the risk and the minute detail involved – maybe that’s why I only made blue belt after 7 years in the business. Only SP types should really look into day trading. I go into the other forms of trading/investing other types should pursue in the book.
On your comment on earnings, it would also depend on trading horizon/leverage – a 3-5% gain in one day is pretty good, and much better using 10x leverage. Interesting points on understanding the value of money. Mark Douglas goes into this in his book “Trading in the Zone”, which is in the Blue Belt Reading List – mostly he talks about how people with a depressed sense of self worth are prone to thinking they don’t deserve to earn money in the market, which becomes a self-fulfilling view. But thinking money comes easy in the markets is likely to leave the trading aspirant disappointed. There is “easy” money in investing because time (compounding) and other people do the heavy lifting. Compressing those earnings into a shorter period involves work, which you must do.
Day trading the Philippines market – that’s one for the truly risk-seeking and/or foolish. I always recommend people to stick to markets they understand, that are liquid, and that they can obtain decent information on. I’d rather swim in clear waters with lots of little sharks than murky waters with a few big ones.