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When your ego gets that big, and the God syndrome sets in, you don't need
spreads, hedges or stops, because you are right. Ira
<p>"Peter M. Beckwith" wrote:
<blockquote TYPE=CITE> <font size=-1>After reading his book, "The
Education of a Speculator", I came away with the feeling that he really
was a "risk taker" who had little concern for risk management. In
one of the sections in his book he describes a series of currency trades
where he is just barely holding on and he is picturing his bankrupt life
if the trades do not go his way. Let me be the first to say that
if I were a big time money manager and I described in a book that was obviously
supposed to be self aggrandizing, that I was risking everything on a series
of high risk currency trades that I would be pretty embarassed.</font> <font size=-1>When
I heard in Oct, 97, probably a couple of months after I finished the book
that he had liquidated his fund and had shafted all of his investors, I
could not help but feel that his type of trading was completely insane.
It is one thing for a small lot trader to dabble in the naked options writing
during a downtrend, but it is an entirely other matter for a guy who probably
hit the options market with several thousand naked contracts. All
I know is that when there is a guy who is trading with size and he is selling
naked options that some savvy and well capatilized trading group could
have run the market down even further to force liquidations. I honestly
believe that this may have happened on that fateful day in Oct, 97.
Anyone who is interested should look at the VIX data from that day where
the premiums rose to 55 for a bried period during the AM. No question
that the guys who took the other side of the trade probably made enough
to retire on. But by the same token they probably hedged.</font> <font size=-1>What
I do not understand is why did Niederhoffer not offset his trades by selling
futures to take care of some of the risk. He easily could have avoided
those catastophic losses had he simply hit the sp market. That seems like
a strategy.</font> <font size=-1>Regards</font> <font size=-1>Pete
Beckwith</font></blockquote>
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</x-html>From ???@??? Tue May 18 19:28:58 1999
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From: "Larry Viles" <larry@xxxxxxxxxx>
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Subject: GEN - Welles Wilder, The Delta Phenomenon
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Receiving literature for the book made me recall that back in the mid-80's,
I had spent $3500 for a one year's printout of these signals. Never did
really profit from the information. Wonder if having the book at this point
in time would be of value?
Larry
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