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<DIV><FONT color=#0000ff face=Arial size=2><SPAN class=172161916-26061999>See <A
href="http://www.programtrading.com";>www.programtrading.com</A></SPAN></FONT></DIV>
<DIV><FONT color=#0000ff face=Arial size=2><SPAN
class=172161916-26061999></SPAN></FONT> </DIV>
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<DIV class=OutlookMessageHeader><FONT face="Times New Roman"
size=2>-----Original Message-----<BR><B>From:</B>
owner-realtraders@xxxxxxxxxxxx [mailto:owner-realtraders@xxxxxxxxxxxx]<B>On
Behalf Of</B> jdfo<BR><B>Sent:</B> Saturday, June 26, 1999 9:38
AM<BR><B>To:</B> Real Traders<BR><B>Subject:</B> General/Fair
Value<BR><BR></DIV></FONT>
<DIV><FONT color=#000000 face=Arial size=2>Does anyone know the composition of
the "fair value" of a commodity, index, currency, etc. Someone on
this forum had mentioned that one of the exchanges or data providers offers an
opening "fair value" of the S&P. </FONT></DIV>
<DIV><FONT color=#000000 face=Arial size=2></FONT> </DIV>
<DIV><FONT color=#000000 face=Arial size=2> I would like to know
what is the formula for determining the "fair value" of a
market so as to maintain a continuing record of this number so as
to ascertain when the price deviates from the "fair value".</FONT></DIV>
<DIV><FONT color=#000000 face=Arial size=2></FONT> </DIV>
<DIV><FONT color=#000000 face=Arial size=2>Many thanks for any
input.</FONT></DIV>
<DIV><FONT color=#000000 face=Arial size=2></FONT> </DIV>
<DIV><FONT color=#000000 face=Arial
size=2>John</FONT></DIV></BLOCKQUOTE></BODY></HTML>
</x-html>From ???@??? Sat Jun 26 12:12:39 1999
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Date: Sat, 26 Jun 1999 10:35:27 -0700
To: Stewart Taylor <staylor@xxxxxxx>, realtraders@xxxxxxxxxxxx
From: Alexander Levitin <alevitin@xxxxxxxx>
Subject: Re: Stops. Another way to look at them.
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Status:
That is very emotional statement, Steward!
Being totally "wiped out" in one trade (even from 8 figure account) is a
normal part of the learning. You do it several times until it gets your
attention (or attention of your wife).
Committing fraud or suicide is not a specific to the trading business but a
"philosophy of life" brought into the business. Different people choose
different ways out of difficult situation (mostly created by their own
doing). Just look how a man of the highest moral standing and the most
popular leader of the greatest nation behave in the "crises" (Mr. Clinton
and Monica, for example).
Very sorry to learn about fate of your friends. Would they use stops, you
would continue to enjoy their company.
Alex.
At 08:43 AM 6/26/99 -0500, Stewart Taylor wrote:
>
>Why have I gotten a little upset over this thread:
>
>I have seen traders, good guys and girls that managed to get behind the 8
>ball, ultimately commit criminal acts (embezzlement and fraud)that
>effectively ended both their professional and family life in order to cover
>up losses long enough to hopefully recoup.
>
>In two cases I have seen professional traders put successful, tenable
>business under with their losses. The result, over 120 people unemployed,
>some of them long term employees with 20 years or more service.
>
>I had a good friend take his own life. He was an institutional trader, had
>many years of experience in trading and doing risk management. He let one
>position take him out. He got bigger than the market, refused to stop out,
>started hiding trades, diverting funds and hiding confirms and less than 3
>months later a wonderful guy was dead.
>
>You have to understand that a whole new set of emotions develop when you
>get a bad one going. Decisions that should be easy can become extremely
>difficult. Your thinking process can become very erratic. You can
>completely lose touch with trading reality. It is a frightening thing to
>witness. It is funny (in a sick way) to see how much a person caught in a
>really bad trade can change years of successful behaviors almost overnight.
>
>Anyway, most of these situations begin when an account begins to take
>unreasonable risk. In almost every case, the trade began as a single trade
>that spiraled out of control.
>
>Keep in mind, these are not accounts that churned themselves or were
>horrible traders. Each person involved was a market professional with years
>of professional trading under his belt. There is something about finding
>oneself in an unexpectedly bad position that can render the most even
>handed trader frozen in the head lites.
>
>
>So do I get a bit heated when I see someone advocating what for most people
>is very dangerous? Yeah, yeah I do. Avoiding problems and managing the
>bad tail is a big deal.
>
>Stewart.
>
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>
>Stewart Taylor
>Taylor Fixed Income Outlook
>Voice: 501-219-9774
>Fax: 501-228-0963
>E-Mail: staylor@xxxxxxx
>Web Site: http://www.cei.net/~staylor/
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