Short Term Trading (Australia Day) Weekend Lounge: 25-28 Jan, page-67

I count myself as a genius.... because I can make mistakes nobody else has ever thought of.

My strengths are also my weaknesses. I am idealistic and trusting.... a few years in the 'market' has changed me a bit. Thankfully I have not lost those traits .... but when I enter into the 'water' these days I do so slowly and cautiously.

I don't regret any mistake I make ... but I do regret suggesting stocks for friends to buy... mostly my friends have lost money when they acted on my well intended advice, so I never do so anymore [even if I am extremely confident...because having a good tip is only about 1/4 of the task... the other 3/4 is money management].

I think the biggest mistake I made was committing too much money to the market when I first started... it only took a few years to lose most of it...

Participating in the market is what is known as a 'non trivial problem'... but I think it can be broken down to a handful of requirements. It's about being able to value something, money management [i.e. learning how to make your available capital keep working for you] and understanding your own limits. On top of that... you have to have a clear idea why you are here and what your endpoints are. Another mistake I made when I first started was I knew none of that... picked up those insights along the way.

I have developed my own style... I think to be successful each person has to do that. If a person can not sit down and articulate to themselves in a conscious and concise manner what their own style is... then they are still, very definitely, on the learning curve and likely to lose more than they win. [Personally ... I attempt to understand the true value of something, I will then watch it for a long time and if I think I can see a catalyst which is going to make that value obvious to everyone else I will then commit some capital and buy. My goal is to end up with a modest cash profit (to try and steadily increase my working capital) and a free carry holding which becomes my long term investment]

No matter how hard I try ... I always go through some period when my capital is all tied up. That's not a worry if the basic investment decision is sound... the only loss is the opportunity cost. But it is a real issue if you are very wrong. I spent nearly 4 years locked up in SOC [now 4CE]... very long and torturous story, at one point down 99% [SP dropped from 20 cents to 0.2 cents] and I won't bore people with the details.... the point is, selling and taking the loss is sometimes the correct investment decision. You succeed in the market not by having a lot of money to play with but by making good decisions..... and the only way you learn to do that is by making mistakes and by accepting the risks.

The market has some aspects of gambling about it. The key to being a successful gambler is only betting when you know the odds are in your favour. There are those participating in the market who are dishonest .... they make sure the odds are in their favour by some form of manipulation [deceit, abuse of position and even outright fraud] ... and they are very happy to take another person down [usually thinking themselves very smart for being able to do so. I have encountered several individuals like this in the market over the years]. These people have their reward ... they frequently make money, sometimes even a fortune. But... it is a real feat to achieve success by honest means... it takes courage, effort, determination and self application. The rewards which come are not just financial success but success as a person. The greatest wealth is having self esteem, a well earned pride in oneself, in the actions one does and the choices one makes. The crooks know nothing about this ... all they get is the money [and the lifelong lingering doubts about their own self worth that goes with that path].

Successful speculating is about understanding what a thing is worth ... when you know that.... the odds are always in your favour.