Sunday, 9 September 2012

Some Deep Questions About Trading

"Did it ever occur to you that trading is not going to make you happy long term? From what I see, you have a very good education - teacher, writer. I don't think you ''deserve'' to stay in the trading world. Taking money from others for our advantage, is not a good ethical thing to do. Sometimes you can make a trader lose his bank with a good single trade. Will that fit your educational standards? All I want to say is that we are affected in many ways: social life, family etc - those things are the real ''value'' for someone like you. To be honest, I take advantage reading your blog and learning from it, but I also think about you as a person. I don't know why, but I feel that sooner or later you will give up and get back to real values."

The above comment (slightly tidied up as author's first language is not English, though still high standard) was submitted by 'speedwave' to my blog following my last post. I thought to do it justice, I would need to answer it as an actual blog post. There are some really interesting questions there which I would like to delve into. 

Did it ever occur to you that trading is not going to make you happy long term?

The short answer is 'yes!'. Of course it has occurred to me many times that trading possibly won't make me happy.  In fact, it's made me rather unhappy for several years! That was until this year. Trading alone, is never going to make me happy. Love is what really motivates most of us to do what we do, in order to become fulfilled; love for a partner, love for family, love for our friends. But it is undeniable that, whilst money can't buy love, it can put you in a greater position to find/share/experience it, as long as you use it wisely.

I am not personally driven by material things. I don't buy anything based purely on what brand it is. I am not into flashy cars or jewellery or owning the latest gadgets or shelling out for the finest hotels or restaurants. These things do not motivate me. But trading is essentially, all about making money. To some extent, you need to be motivated by money in order to be successful at trading. For me, it is more about the freedom of choice that money can give you, not the material goods you can accrue with it. That potential freedom is what drives me as a trader.

The great thing for me personally about sports trading, is that I love sport. I would never be any good at financial trading because I have little interest in the subject. FOREX and Stock Exchanges and Futures just leave me glazed. But sport on the other hand, now I can get involved in that and truly enjoy myself. Now that I'm actually making money through trading, sport has become even more enjoyable! So trading is beginning to make me happier.

Is sports trading going to make me happy long term? I can't answer that. Who knows what the future may bring. But if it all goes to plan, I am certain that it can put me in a position where I am comfortable financially. And when I have that, I hope to have greater freedom than a 9-5 rat-race job with less opportunity to scale-up and take time off, could offer me. With that freedom will come greater opportunities to do things that REALLY make me happy - producing music, travelling, playing more sport and spending more time with those I love. There is no point thinking about the negative side too much. I would not have got to where I am without positive thinking. The moment you start focusing on the bad stuff, is the moment you start along the path of a loser.

From what I see you have a very good education - teacher, writer. I don't think you ''deserve'' to stay in the trading world.

By 'deserve' I think speedwave means that I deserve better than to waste my education being a trader. I do have a decent education although to be honest, both the writing and the teaching jobs I've done (just as with my DJ-ing) were not successful because of my degree. Having a degree gave me a quicker entry into becoming a teacher but if I hadn't been a hard-working, driven, self-motivated and positive individual, I wouldn't have gotten as far as I did. My freelance writing was built up entirely from scratch - no qualifications or training at all. DJ-ing and then club promoting, was something I worked hard to become good at; winning competitions, making contacts and behind all that, hundreds of hours of practice on my own in my bedroom, when I could've been out doing other things.

When opportunities came along, I grabbed them and took risks in all of those jobs. You could say it was down to luck but I don't believe in luck - you make your own 'luck' in life by putting yourself in the right position to grasp hold of opportunities when they arrive. You do that by being pro-active, positive, hard-working and open towards others. I could've done pretty much everything I've done without higher education.

It was my choice to go into trading. I was unhappy about being made redundant (twice) and always having that spectre of uncertainty about my job. I loved teaching but felt it had run its course anyway. I was exhausted with all the bureaucracy involved and the constant assessment and the awful management and the 9-5 grind. It was my choice not to go back into it. As with writing, I wanted to try trading so that my future would be better - more freedom. But I knew immediately with writing (and much later with trading), that it would take a long while before I got to a position where I had that freedom. Sure, there are professions that I would find more fulfilling but very few that could give me that financial and time-related freedom.

Taking money from others for our advantage is not a good ethical thing to do. Sometimes you can make a trader lose his bank with a good single trade. Will that fit your educational standards?

That's a bit hypocritical coming from a trader! If you seriously have these worries then you should quit trading right now! This is what we do, that's what trading is - taking money from others. It's dog eat dog, we are all fighting for the flow of money in the markets and some will win, some will lose. Everyone, and I mean EVERYONE, who doesn't understand this, is not trading properly. All my trades are based on what the market is doing and the market is just a collective term for all the bettors and traders. If you don't place trades based on what that collective is doing, then you are just gambling and guessing.

I've lost my bank on many occasions but I don't sit there and blame the people who took my money - it was my fault. We are all adults and have to accept responsibility for our actions. Trading isn't unethical. We all have the same access to the same trading tools and we are all watching the same sporting events. It's an equal opportunity for anyone (court-siders and insider-dealing aside!) to achieve. There is no clear advantage or disadvantage to anyone. And if you think there is, why even bother trading?

Being well educated doesn't make you more ethical than anyone else. Educational standards have nothing to do with this, it's not a question of morality. You cannot 'make' a trader lose his bank - HE loses his bank by being stupid enough to risk all that money. Rule number one of trading is 'never trade with money you can't afford to lose'.

All I want to say is that we are affected in many ways: social life, family etc - those things are the real ''value'' for someone like you. To be honest I take advantage reading your blog and learning from it, but I also think about you as a person. I don't know why, but I feel that sooner or later you will give up and get back to real values.

As I mentioned above, those values are the same for EVERYONE, no matter what your educational background is. I think speedwave means that I am trading at the expense of social life and family but to me, trading is no different to any other form of employment that can provide great financial reward.

If you were training or working towards being a doctor or lawyer or a sportsman or an actor, you have to put in the hours. No one became successful in any of those industries without some form of sacrifice. That might be giving up a varied social life because you have to swot up for medical exams or not having a serious relationship because you have to travel and compete all over the world as an athlete or not being able to spend any money and live in a nice place because you are an out of work actor waiting tables, trying to get your big break. At the heart of most success stories is a tale of sacrifice and often hardship. If you don't want something badly enough, there will always be someone who has greater determination than you who will beat you to it. Ask almost any successful long term trader and they will say the same.

I could give up trading and go and get an easy, dull 9-5 job with plenty of time for those "real values" but will that get me to where I want to be in 5 years time? If I stick at it and continue progressing, I could make a lot of money and who knows what other opportunities that may lead to - within trading or something entirely different. I've made a lot of sacrifices to attempt to become a profitable trader but I'm sure they are no different to many in that 1% (or whatever it is) who have made it as pro traders. But the aim is always for a better future (which would give me MORE time for those 'real values') and if I didn't have that as a goal which I believe I could achieve, I would have given up a long time ago. Some people are fine with the norm and just getting by, leading an average life but I'm not. I've always taken risks because that is what usually leads to great things (even though it can get you in hot water too!) and I'll continue to do so until I get where I want to be.

Thanks for the questions speedwave, I enjoyed answering them. I always welcome comments and questions, so if anyone has any more, feel free to leave some. They really help with material for the blog too!

Dominica Cibulkova:


  1. I hear you man!
    Just wanted to say I totally agree with everything you said here, specially the last paragraph.
    Keep working to make your dream a reality, and ignore the naysayers. Life is short.
    Best of luck!

    1. Thank you! I don't think Speedwave is one of the 'naysayers' (I think a little is lost in translation) but I get the feeling he asks himself the same questions.

    2. (1) You are right Sultan.
      All trades usually follow the same path to become profitable. I see it all around. Only a few listen to others in order to follow some strictly rules – which I think is the secret in trading -. We know how to make money but we can’t for simple reasons . We, as humans, don’t like to stay in one place to long, we don’t like to shut up, we like variety, we like to change things all the time: the furniture, the car, the girlfriend, we don’t like normal sex, etc . That is why we can’t trade properly, we know what we have to do ,we do it a few times than we change something for some reason (more money in a short time ?) , than we go to other strategy – same result ,start to look good than change ,etc . We need to stick to the profitable plan. You can read best known trading books but you if never trade it / lose money, will not help you at all . We all have to lose a lot of money before learning the lesson ourselves. The sooner we lose money the better, the later we lose (beginners luck ) the worst it is (increasing stakes to dangerous levels) . Anyone really thought deeply why U.S , France( and maybe other country) don’t allow live trading ? The only reason is that taxman can’t visit them? I doubt it. Imagine you been the president/prime minister of your country, will you allow this? I won’t personally. Why? Because more people lose their money and only a very small percent will win, this things on a larger scale will affect the economy of the country, medical insurance, family , etc . Can we talk about gabling addictions? There are studies that show that? Sure, that is why there is . What a smoker addicted will tell you when you talk with him about the side effects of it? Will deny it, will fight hard against your arguments . The truth is that inside of him there is a real fight , he knows he is addicted , he just don’t want to face the truth, hoping that he will be one of those 1% that will not be hit by any smoking related disease. The same think is starting to happens in betfair dream world . Those who make money will not agree with that, but think twice, is this, as a daily job, really help you gain more love from your friends/family , or more like they avoid you when they hear about your ‘’business’’ ? We will have 1% making money traders with high standards and well educated, while the the others 90% will be what ?

    3. (2)

      We all like to have models in life. Through time I read alot about trading, including this particular aspect. What are the real models we can take in the betfair world? If it were to think about nr.1 one person that is around since the early days of betfair who will that be? I think about Peter Webb , I think is the best model I can pick up – I don’t know a better example as he is the first who created a trading tool and makes tremendous amount of money since then . He has given one interview to a TV-stations and few others to some betfair system sellers . What this man does is very simple if you look over his forum, history (between, It’s the most ‘’quite’’ forum in terms of bad language ), this man has falling in love with statistics, Microsoft Office and betfair. He download it data from betfair, download it charts personally with B.A. excel tools for a very long time and now he takes the profitable margin from it with bots (most of it ). He also does some seminaries and B.A. subscriptions. Very well . I really respect this person from this point of view. A very good top trader. I wish him the best. Like in everything in life, sport, specified business, etc, only a handful of people can really be the best in what they are doing. I think in life we should always look at all aspects, good and bad, before starting to do something, especially when is with long term consequences, otherwise, by thinking positive all time and not been ready for the hurricane will not be good. Now lets look at another example which was in a way Peter Webb apprentice . That is Adam Heathcote, this is he’s blog . He used to trade prerace horses. He managed to make 150.000GBP in one years, next year 250.000, than 350.000gbp . If you read some of his early posts and gradually read them all you will se that trading its not just a job we all dream to have, in particular what he posted in one of the late posts , in 4 march 2010, it is called ‘’ Life or death’’ , it is actually very suggestive… read : ‘’ I realized that the way I trade is similar to being in a life or death situation. When I trade I don't want to fail, to the point where if I did it would result in death. Obviously I wouldn't die! But my brain seems to react in that way. A lot of this boils down to my innate competitiveness that is present in nearly all successful traders - probably mostly short term traders. The best way I can explain the way I present myself while trading, just imagine that you were playing this game where you had to beat half the people at pressing a button the fastest before they did otherwise you would die. ‘’ .

    4. (3)

      Sure, you may think I look for the negative things instead of sticking to pro-active trader , profit, professional trading, pro-thinking ,etc, but this things exist to , I know there is money out there that can be made , in fact, like Sultan I start to make money to, after 3 years since I opened my betfair account. But look very well at the world we are living in, is the ‘’trend’’ starting to accept the traders as a valuable member of the society? Or it looks more like the trend is going down? Are you in, among those 1%? Very well then, keep it that way, if not, I advise for caution.
      Not everyone is made for trading. We are humans, made of bones, meat, organs and above other species we have intelligence that comes together with feelings. If you scare a cat, almost immediately she forgets and comes to you. A human feeling, once hurt will remember that experience all his life. You can learn to ignore it but you can’t forget it. Another thing is body health, the most valuable thing in life, right? If you read any medicine related book you will notice that stress, was and it is related more and more with many disease.
      Scenario: Let’s imagine you spot it a typical opportunity to lay 1.05 on the final match. You lay it for 50k profit. Price increases to 1.5 and you exit with nice green. Later that night when you look at TV you see headlight news that one person toke his life because he lose it all his life earnings gambling sports. After 2 days, police investigations report that the person lose it on sport trading company ( betfair ) , placing a huge bet on a tennis favorite at small odds. Anyway, you receive all the details that leads that you could be one of those who triggered him to bet (because you were among those who created the price), you see his parents crying/family destroyed. Of course he was stupid to back 1.05, was his fault, but will that affect you?
      Don’t get me wrong, try to get the big picture of what I meant, look at it more in psychological or philosophical perspective.
      Well, I think that we live like in the Platon’s fascinated Myth of the cave, we look always at the fire and whateverpoint of view we get (not myn ofcourse, but in general), we strongly rejected as been abnormal , although it may the key

    5. Speedwave, there are FAR less ethical ways to make money - Bankers ring any bells with you? Think of the hundreds of thousands of families and lives those shit heads have destroyed through their incessant greed. Trading is an honest profession, and if you qualms about it, maybe you should go do something else, like work for Greenpeace.
      Love and peace,

    6. Speedwave, the scenario you describe is never going to happen (for starters, suicides don't make the news unless very unusual), so it is pointless even thinking about it.

      You can be stressed in any job. If trading is making you ill, then stop doing it - simple.

      The 'Life or Death' comment, you are taking far too literally! I've read Heathcote's blog. He enjoyed what he did and was very successful. He made his money, then decided to use it to build another business - that is something I might do one day.

      Why are you so obsessed with what everyone else is doing? I don't care about Peter Webb or Adam, I care about myself and I'm doing fine.

      The USA has bans on gambling because it is a deeply religious nation, where many people still see gambling as a 'sin'. The same in many other countries. They still have national lotteries though and the USA still allows guns to be bought legally. I suggest that they have far bigger 'sins' that should be dealt with that cause far more problems.

      The UK is not a deeply religious country and you should be greatful because there wouldn't be a Betfair for you to trade on! If you ban anything, it drives it underground where it become unregulated and can cause far more problems. Surely it is better to take the taxes and invest that money back into helping the nation's services? Gambling will always be around, just like drinking, smoking, prostitution etc. It's not a massive killer compared to ANY of those.

      I think you need to ask yourself all these questions. You seem to have a lot of issues with trading. Let me ask you something - why do you trade if you believe everything you've written? I don't have any issues with trading at all and I have nothing more to say on this matter.

    7. This comment has been removed by the author.

    8. We are all adults, we don't need to be informed of the pitfalls. I understand the good and the bad side already, as should everyone who thinks about doing this. You don't need to worry about me, I'm a grown man! I know the risks involved and as I said earlier, I am prepared to take risks and always have done. Sometimes it doesn't work, sometimes it does - that's life. As I say, I don't concentrate on the negative side because it won't get me anywhere.

      Anyway, enough on this subject - good luck with your trading.

  2. "Taking money from others for our advantage is not a good ethical thing to do. Sometimes you can make a trader lose his bank with a good single trade. Will that fit your educational standards?" Whether you choose to trade or not people will lose money. I have lost enough to know this, It's not because of your lack of ethics I lost, I'm a big boy now, why should you not profit from the profligacy of others ? Methinks your poster is asking questions of you that are aimed at him/herself ?

  3. Trap bets aside, an exchange/market is a pretty fair place.

    A fool is always parted with his money...

  4. my only ethical dilemmas are when i don't trade right and for that i only blame myself. otherwise i'm proud to help others to get a better price by providing liquidity in the market.


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