My Childish Fantasy on Speculation

When I quit from my brief stint as a journalist and took a dive into the field of stock market speculation, I was deeply confused when people asked me what is the relationship between stock market speculation and journalism. At that time, my idea was just to do something on my own and make a living out of it.

To most people, speculation is similar to gambling. Even when I started this business I was also compelled to think in that way. Because, during those days, there was no one to teach or guide me. Only factor which kept me floated was the financial assistance I received from family, friends and clients.

In the beginning, at times, I felt like I was trapped with no way out especially when the business meet with heavy losses. I also believed that people who are experts at computer coding languages and technical skills can excel as a trader and it is not meant for a person like me who emerged from a journalistic background

Basically, speculating in stock market is a tough business. It is a game against basic human psychology. Most real world concepts, ideas and analogies never work in stock market. Whether you are a journalist, computer expert or even an astronaut, speculation is a simply a tough business.

For example, in real world, it is said that if we have a strong opinion, we have to fight till the end to defend it. We urge to keep on with our struggles with hope and faith.

But in stock market, hope and faith are dangerous especially the position we have taken is moving against us. There is no validity to one’s opinion till the market confirms that opinion with favorable price action. If market doesn’t confirms your opinion, you should abandon your opinion and move with the market.

Intrinsically, we, humans are egoistic and good at fighting with hope when things go wrong. When the going get tough, the tough gets going may work in our real life, but it never works in stock market. When the going get tough in the market, only way out is being flexible and move with the market.

When things go wrong and you are not ready to abandon your opinion, your money will be gone and only your opinion remains with you.

Jack D. Schwager, a hedge fund manager and an author interviewed nearly top sixty successful traders in the world. His books are published in a series called ‘market wizards’ series. I have read all interviews in the series. The interviews made me realized that only few traders tasted success in the beginning of their career. Most of them learn the art of trading the hard way by falling down and getting up.

After years of struggle, pain and confusion, when I became capable of making a stable living out of trading, I decided to take a look into the history of speculation.

It was a great joy to learn that Charles Dow, who is considered as the father of western Technical Analysis is a journalist and also the founder of Wall Street Journal. So, today I can proudly say that there is a deep relationship between journalism and speculation.

George Soros, a billionaire speculator of modern times also known as the man who broke the bank of England considers himself as a philosopher. He is also an author.

I read some of the prominent books on history of speculation like ‘Devil take the hindmost’, ‘More money than god’ and ‘Reminiscence of a stock operator’ which is based on the life of a popular speculator, Jesse Livermore. The people who made a living out of speculation on land, stock and bond markets include scholars, ministers, priests and even common men with little education. The profession of speculation had its beginning even before the invention of steam engine!

While reading the books on history of speculation – a history comprises of human need, greed, fear, hope and adventure – I can feel a deep relationship with it. It is a fascinating history of fortunes made and lost. The tales of will and vigor of speculators who dared to bet on unknown and ventured into uncharted territories.

I feel like I have gone through all these, was a part of it and had lived in that period or era. I can sense and relate the places and events; feelings and emotions of speculators when I go through the pages. Each page surprises me with a feeling of déjà vu.

Maybe I’m deeply immersed in the subject I’m reading or learning or this may be the feeling I experience when I fall in love with something deeply. Naturally, whatever we love becomes an inseparable part of us. These profound feelings may be arising from my obsession with my passion. Or it can be, my mere childish fantasy.