Funny, I was just researching poker books today before your letter arrived. I found a new one highly graded through Goodreads. Check out "Exploitive Play in Live Poker". Sounds promising.
You need to be more critical of these traders. You said Qualmaggie turned $5,000 into $81 million in 10 years starting in 2011. But then you also note that he made $77 million of that starting in January 2020, which means he turned $5,000 into $4 million by the end of 2019.
Well what happened in 2020? The COVID-19 pandemic of course, when governments printed trillions of dollars, stocks markets took off like crazy, and many new people entered the markets. Some of those people did well; others may have done well for a while and then flamed out. People’s success in 2020, in other words, may have been less a result of their skills and more a result of being lucky.
That’s what appears to be the case with Qualmaggie. Turning $5K into $4 million is impressive, but it 9 years to do that, which means the other $77 million must have been less about skill and more about luck than you’re realizing.
This is why people need to always be careful when taking trading advice from anyone. Things aren’t always what they seem and people they look to for advice may not be as impressive as they seem at first glance.
Turning $5000 to $4M over a period of 8 years also takes significant amount of skill.
And if a trader survives long enough, there comes a stage where for their specific style, the setups and universe of instruments they trade, there is a year or two of parabolic growth.
It's less about luck. It's not luck if someone makes $70M with $5-6M capital - but over 1000s of trades.
Right place right time - having 5M capital going into 2020, etc., are all incidental and important enough to lead to this result. But calling it luck is just insulting.
Sure markets were more rewarding in 2020. But he also made another 40 million in 2021, another 50+ million in 2022, and now his net worth stands over 200-250 million dollars.
By your logic, Mike Burry and John Paulson were extremely lucky and it wasn't their skill that they made a billion dollars from just one trade where they staked less than 40-50 million initial capital.
Or that Soros and Druck experienced extreme luck when they bet their entire fund's AUM on a single trade 2x leveraged shorting the GBP.
Anyone who considers that succeeding in business or markets takes extreme luck usually doesn't succeed.
There's work, and there's structured work, and then there's preparation, and then there's market opportunities meeting your preparation. Survive long enough as a trader with discipline and there will be a year or few where the market aligns with your personality, your trading style, etc., to give you that parabolic growth.
It's easy to equate trading to gambling and something of a luck based profession to make such progress.
It's after 10 years of linear growth that he hit parabolic growth, which usually happens to people even at the prop firm I work at if they have worked long enough (have seen people going from $500k one year to making $1m next year to making $5m the next year and so on.
Funny, I was just researching poker books today before your letter arrived. I found a new one highly graded through Goodreads. Check out "Exploitive Play in Live Poker". Sounds promising.
You need to be more critical of these traders. You said Qualmaggie turned $5,000 into $81 million in 10 years starting in 2011. But then you also note that he made $77 million of that starting in January 2020, which means he turned $5,000 into $4 million by the end of 2019.
Well what happened in 2020? The COVID-19 pandemic of course, when governments printed trillions of dollars, stocks markets took off like crazy, and many new people entered the markets. Some of those people did well; others may have done well for a while and then flamed out. People’s success in 2020, in other words, may have been less a result of their skills and more a result of being lucky.
That’s what appears to be the case with Qualmaggie. Turning $5K into $4 million is impressive, but it 9 years to do that, which means the other $77 million must have been less about skill and more about luck than you’re realizing.
This is why people need to always be careful when taking trading advice from anyone. Things aren’t always what they seem and people they look to for advice may not be as impressive as they seem at first glance.
Turning $5000 to $4M over a period of 8 years also takes significant amount of skill.
And if a trader survives long enough, there comes a stage where for their specific style, the setups and universe of instruments they trade, there is a year or two of parabolic growth.
It's less about luck. It's not luck if someone makes $70M with $5-6M capital - but over 1000s of trades.
Right place right time - having 5M capital going into 2020, etc., are all incidental and important enough to lead to this result. But calling it luck is just insulting.
Sure markets were more rewarding in 2020. But he also made another 40 million in 2021, another 50+ million in 2022, and now his net worth stands over 200-250 million dollars.
By your logic, Mike Burry and John Paulson were extremely lucky and it wasn't their skill that they made a billion dollars from just one trade where they staked less than 40-50 million initial capital.
Or that Soros and Druck experienced extreme luck when they bet their entire fund's AUM on a single trade 2x leveraged shorting the GBP.
Anyone who considers that succeeding in business or markets takes extreme luck usually doesn't succeed.
There's work, and there's structured work, and then there's preparation, and then there's market opportunities meeting your preparation. Survive long enough as a trader with discipline and there will be a year or few where the market aligns with your personality, your trading style, etc., to give you that parabolic growth.
It's easy to equate trading to gambling and something of a luck based profession to make such progress.
It's after 10 years of linear growth that he hit parabolic growth, which usually happens to people even at the prop firm I work at if they have worked long enough (have seen people going from $500k one year to making $1m next year to making $5m the next year and so on.