Читать книгу Taming the Lion - Richard Farleigh - Страница 3

When I started my career in a Sydney investment bank in my early twenties, I did not believe that I could outperform the markets. As a former economist and a chess player, investment and trading just seemed to be a form of gambling. I had no idea how the markets could offer any opportunities.

Gradually, however, I came to believe that market prices are predictable, and within a few years I was running a trading desk dealing in hundreds of millions of dollars. Because I wanted a long and prosperous career, I developed a repeatable methodology which was based on observation and reasoning, not just on one-offs and luck.

I had many beliefs which went against conventional wisdom, some of which included:

 Markets tend to under-react, not overreact.

 Big, obvious ideas offer great opportunities.

 It is safe to invest with a consensus view.

 Contrarian trading is usually irrational.

 It is best to enter and exit the share market at the right times instead of always staying invested.

 Price trends are well known but under-utilised.

 Chartists are just astrologers.

 Investment and trading are increasingly similar.

Some things I simply tried to do better than other investors, these included being sure that I was chasing a genuine opportunity, managing my risks and coping with my losses.

I also developed some trading systems, which were still being used years after I left the bank.

As my trading results started to attract some attention, I was frequently asked to give presentations of my ideas to other professional traders. Question times often continued throughout dinner and in the bar. I learnt a lot from the feedback during these sessions. Like me, others were interested in an approach to investing which was based on first principles. I found that anecdotes were the best way to make a point, and that by presenting the ideas as a list of strategies I could show clearly how the methodology works and provide a useful summary.

Years later, I am still using the same approach, and I have found that as well as the professionals, there are many amateurs who are keen to find out how markets work and how to improve their investment performance. These are the secrets that they want to discover.