Foreign exchange masters (3) - Bruce Kovner

{}Posted in2023/2/25 1:15:36 | 4Browse

Bruce Kovner engaged forexrebatecommission foreign exchange trading for more than a decade, the battle best forex rebate company amazing, the average annual return nearly bestforexrebatecompanyubled in 1978 to invest $ 1,000 to his operation, to 1991 has become a million dollars Kovner scholar originated from Harvard after graduation in Harvard fxrebatecentral Penn State University to teach political science he likes to teach, but cashback forex much enthusiasm for his career as an academic. rebatesforexbrokern the early 70s, he began to politics, first to help others campaign, intend to run for office in the future because of the lack of funds, and he was not willing to start from the committee slowly up the ladder, so finally had to give up the plan to enter politics Kovner around to explore career direction, and finally decided that his background in politics and economics is very suitable for the financial markets once clear goals, Kovner will be head He was particularly interested in the interest rate issue, and the hard work in this area helped him a lot in his future foreign exchange trading Kovners first transaction was based on the change in interest rate differential, and the result was as expected, earning a small amount of money he did the same thing, and did the difference between the two markets, but entered too early, the result lost a little The two transactions counted down to a slight surplus really made his start is the third transaction in 1977 he found that the supply of soybeans will be a shortage of recent futures have begun to rise, but the forward futures have not kept pace with the beat he used this difference to do hedging transactions, from a pair of contracts to do, after the winnings inverted gold Uta to increase the size, and soon added to 15 pairs of contracts, floating profits of more than $ 40,000 This time he misheard the advice of his broker, for greedy for greater profits and one-way to close the recent contract results 15 minutes after the broker called to tell him that the big deal, the market began to fall back quickly, has reached the down board he shouted quickly to close the single is still walking in time, in the down board rebound during the short period he successfully left the market, the original $ 40,000 profit is only half although the account has doubled a good child, but Kovner still for their last-minute mistakes painful, a few days He had two profound lessons First, futures trading is as risky as it is rewarding, and the money you make will soon be lost if you are not careful Second, always be sensible and do not take risky actions by trusting others Kovner resumed trading a month later and soon added value to his account to $40,000 He applied for a position as a trading assistant at a company, and a few weeks after the interview, the examiner, Michael Marcos, called for a position as a trading assistant The examiner Michael Marcos called him to the company: I have both good news and bad news bad news is that the assistant position can not give you the good news is that we want to hire you directly as a trader Marcos later became Kovners teacher Kovner admitted to learning a lot of important things from him first of all, he let Kovner build confidence, as long as the proper handling of the entry and exit in accordance with the principles, making a million dollars is not difficult he He also made Kovner realize that he had to be brave enough to admit his mistakes, and as long as he judged wisely, it didnt matter if he was wrong, he made a clear break again, and then he was wrong, and then he made a clear break again, and then he doubled his profits Kovner was mainly engaged in foreign exchange trading, futures and spot are done, and no matter which currency, as long as there was an opportunity to enter, often the daily in and out of the trading volume of hundreds of millions of dollars His deep political and economic background made him to the foreign exchange market He has a thorough and unique insight into technical analysis is to take and give, neither dependent, nor abandoned Kovners insights into the markets depths can be seen in a special interview in one or two of the following excerpts from his dialogue with the interviewer part Q: You are one of the worlds most successful traders, few people can match you where you are different? A: I think it is difficult to say why someone can, someone can not on my own, I think there are two important factors: First, I have imagination about the future of the world, can see the difference between the future and reality For example, I think the dollar against the yen down to 100 is possible (he said this when 1 dollar to 150 yen) Second, I can maintain sanity under pressure, to comply with the principles ;Q: trading skills can be taught? A: There are certain limits over the years, I trained about thirty people, but only four or five became good hands Q: What about the other 25 people? A: All changed line this has nothing to do with intelligence Q: What is the obvious difference between the successful and failed apprentices? A: The successful strong, independent, different ideas they are reluctant to enter the field when they are brave enough to act when they are disciplined, into the field of moderate size too greedy people always smash the pot some very agile people earn money always can not keep I have a colleague smart through the top, excellent ideas, the market is also well chosen, in terms of knowledge he knows more than I do, but I earn money can keep, he always can not Q. Where is he wrong? A:The scale of entry is too large I do a single, he did 10 each year he always twice the principal doubled, but a year down or flat Q: You always rely on basic analysis when making entry decisions? A: I basically always do a single according to market judgment, not based on technical analysis alone I often use technical analysis as a guide, but if you can not figure out the reasons for the market to move, I do not enter the field Q: Is that every single have to have a basic reason for backing? A: I would add that technical analysis often makes basic analysis more clear I give an example: the past six months, I think the Canadian dollar up for many reasons, down for many reasons, I can not figure out which explanation is correct to be forced to take a gun to my position, I may choose "down" then the United States and Canada Before the announcement of the trade agreement, I felt that the Canadian dollar had reached the top of a mountain and I didnt know whether it was going to fall or continue to climb up. The Canadian dollar broke out to the upside which means more people in the market think the positive outweighs the negative, so buy the Canadian dollar Q: Does this example show that when a major event occurs or some fundamental factor takes shape, the markets initial reaction foreshadows the long-term trend? A: Exactly the market always leads, because there is always someone who knows more than you do For example, the Soviets were very good at it Q: Doing what? A: Do foreign exchange, grain futures are also good Q: Isnt that a bit of a contradiction? The Soviet economy is messed up, but foreign exchange is doing great why? A: Just kidding, they may really peek at our mail, but they do intelligence very quickly they have the worlds most developed spy system, often eavesdropping on business communications, so some big traders on the phone to talk about sensitive issues often use anti-bugging I mean there are a lot of difficult to understand the mechanism will guide the market, often in the general public is not aware of when the first move Q: that is not Is not that the basic principle of technical analysis? A: I think some of the technical analysis is very reasonable, some are hoodwinked some of the technical analysis claim to be able to predict the future, not some pompous technical analysis to track the past, but not predict the future you have to do their own brain to make conclusions, to see if the activities of certain traders in the past can reveal the movements of other traders in the future I personally feel that technical analysis like a thermometer those who claim to never look at the chart of the basic analysis of the school is like a doctor said he does not give If you are serious about the market, you should understand the current state of the market one by one whether it is hot or cold, moving or stagnant technical analysis reflects the whole market vote, so there will be strange phenomena by definition, any new graph is unusual and therefore it is very important to study the detailed changes in prices look at the charts can make me alert to anomalies, explore the potential changes Q:What do you do when the market goes against you? How do you distinguish between a small bounce and a bad single? A: As long as a field, I always set a good stop loss beforehand, only then I can sleep before I enter the field to know where to exit the field of entry size depends on the stop loss, stop loss with technical analysis to determine, for example, the market is moving in a price range, stop loss can not be located within the price level, it is easy to encounter I always set the stop loss in a technical obstacle point (resistance or support) after if the location is well chosen I always set the stop loss level at a certain technical obstacle point (resistance or support) after if the location is well chosen, generally not easy to encounter Q: Speaking of stop loss, because your trading volume is very large, so I presume that your stop loss single just in mind, right? A: Lets put it this way: I put my life in order, so that the stop-loss orders can always be executed in a timely manner they do not enter the plate, but definitely not psychological stop-loss, in place when it must be executed Q: You are now into the single volume than before much larger, which is not adding extra difficulty? A: I can have enough liquidity to give full play to the market less like copper futures, I like to do, but the market is too small, not enough liquidity like the coffee market I also do, last year made a few million but a few million for me has been irrelevant, but consumed a lot of energy so I mainly do foreign exchange Q: you are responsible for the operation of the money Im afraid than any other trader in the world are more if Catch a period of time is always losing money, how do you cope with the psychological pressure? A: The psychological burden is indeed very large, any day I may lose a few million if the loss is too serious, it can no longer do my only concern is the poor operation of the funds every once in a while I will have a certain transaction lost too much but the loss of money itself I never had a problem, as long as the loss is clear, and completely according to the trading skills to act I learned from experience to control risk but the daily profit and loss does not affect my I learned from experience to control the risk but the daily profit and loss does not affect my emotions Q: Have you ever lost money in a year? A:Yes, in 1981 I lost 16% Q: Do you do foreign exchange is spot or futures? A: I only do spot, unless sometimes set the market to eat the difference between spot and futures interbank market (spot) much better liquidity, transaction costs are much lower, and is 24 hours trading which is very important to us, because we do 24 hours a day what we do foreign exchange, all European currencies including the Nordic currencies, all major Asian and Middle Eastern currencies cross plate is also spot good to do futures because the contract amount is fixed to do The crosses are more troublesome to calculate in the spot market, the world is the dollar as the unit of measure, even the crosses are no exception Q: Are you doing a lot of trading outside the U.S. plate? A: Yes, first of all, everywhere I go is equipped with monitoring screens, home, country house, everywhere secondly, I have a 24-hour staff on duty when they immediately call me in the event of a major event we have a call price for each currency I have an assistant dedicated to handling calls for me we joke that he is only allowed to wake me up from home twice a year he may receive three or four calls a night due to prior planning, he can I usually limit my trading hours to 8 am to 6 or 7 pm Far Eastern markets are very important, opening at 8 pm, Tokyo morning trading to 12 pm at night if trading is very active, I will also do a few hours sleep after 12 pm, and then get up to catch the next opening of the period of great market movement before so I have connections in various markets around the world, so the news is very well-informed This is a very exciting game aside Im not talking about trading to make money, one of the main reasons Im doing this is because Im fascinated by analyzing the worlds political and economic situation Q: Listen to you, it seems like the whole process is like playing a game, not working A: Indeed, I dont feel like working, unless you lose, then I feel very hard for me, market analysis is like a diversified chessboard, the fun is purely The spirit of enjoyment Q: You talk about both the importance of controlling risk and the confidence of holding a single, how much risk do you generally take in a transaction? A: First of all, I try to do any one transaction to take the risk of up to 1% of my account Secondly, we check every day to see if the single made is relevant If there are 8 kinds of single are highly correlated, although divided into 8 kinds, but in fact is a, only the risk is 8 times greater Q: Does this mean that if you are bullish on both the mark and bullish on the Swiss franc, then you only choose to buy one? A: Indeed, but more important is to do long in a market at the same time to try to choose a short market, for example, right now I do short dollar, but I do long yen when I also do short mark Q: like you do mark / yen cross, is not slower than doing separate currencies? Answer:Not necessarily sometimes make big money as usual Q: Your trading style is a combination of fundamental analysis and technical analysis If you are forced to choose, which one do you choose? A: Its like asking a doctor if he likes to see by diagnosis or by observation, which one can not be less than the 70s when it is easy to make money by technical analysis, when the phenomenon of false breakthroughs is much less now everyone is the image school, and the proliferation of technical trading systems, I think this is not good for the technical school Q: Do you think the single master has no special talent? A: The original super masters should be a very small number of Q: How much of the success of single talent and effort? A: not under the hard work very few may become a master someone may short-term to get, but long always not recently I just heard someone do copper futures last year a year earned 27 million, but soon all lost back Q: What advice do you have for newcomers? A: First of all, must recognize the importance of scraping risk management second advice is, do less, do less, and then do less no matter how many orders you think you should enter, first cut in half and then say in addition, newcomers tend to humanize the market the most common mistake is to see the market as a personal head actually the market is completely transcendent, it does not care if you are winning or losing money a trader who subjectively says: how I wish or hope How, then he will not be able to concentrate on the analysis of the market, which is harmful and unhelpful

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