Episode 6: "Undertread" — In other words, it is important to limit the number of trades.
Episode 6: Bruce Kovner
Trading is not easy to win
Trading is tough
Individual investors are feed
You’ve probably heard or thought things like this.
But on the other hand, some people say this.
“Even I don’t really understand why some people can’t make money.”
It sounds like a flippant remark, but then goes on.
“But I think there are two important elements for success.”
“One is the ability to imagine something completely different from today’s world,
and the ability to believe that it could realistically happen.”
“And the second is the ability to remain rational and composed even under pressure.”
Such a trader is a person named “Bruce Kovner.”
(Quotation: http://static6.businessinsider.com/image/4e70707a69bedd2d13000025/kovner.jpg)
He has achieved an annual return of 87% over the past decade.
This annual return would turn $2,000 into $1,000,000 if you invested it with him in 2016 and left it for 10 years.
He has several famous quotes worth sharing.
Q: If you have any advice for an ordinary trader, please tell us.
A:
“First of all,make sure you manage risk properly.”
“Secondly, you should avoid under-trading— i.e., keep the number of contracts you trade small.””
This may seem mundane, but it is the most important concept in asset management.
From his perspective, ordinary traders tend to hold positions that are 3–5 times larger than their actual ability.
Well, that’s inevitable.
FX and BO often market themselves with such leverage that you can dramatically change your life with little capital...
By the way, besides overtrading, there is another common mistake ordinary traders make.
“Many traders share this: they tend to think of the market as theirs personally,and that the market operates around them.”
A trader thinks,
“...I want him to become like this”
“...it would be good if this happened”
Such thinking is ruinous.
Author:Yusuke KurodaProfile: FX information products trader. While working as an office worker, he became free from money worries through FX and binary options.
Blog:FX information products trader - verification review site
