Wednesday, December 17, 2008

Scalping

John Grady has a simple web site at www.NoBSDayTrading.com and he does a good job of describing the disadvantages of most popular trading methods and systems and provides an excellent description of the benefits of scalping. His market of choice is Bonds and Notes future contracts. I purchased the eBook and received the video via email.

The ebook is very reasonably priced at $39 and is an excellent description of how to scalp any market using interest rate futures for the examples. The video is basic showing several trades over several days and complements the ebook content very well.

I will not become a scalper but this site and ebook did give me a much better understanding of market action at the trade level. It has also increased my respect for traders like John who can make 100 plus round trips in a day without using charts.

If you are interested in scalping or just want to learn more about how others scalp it is well worth the modest fee and the time to watch the video.

Saturday, December 13, 2008

Audio Books for Traders

An 8 GB ipod will hold a lot of great trader audio books.

I have collected some of the best trader related audio books for times when I am stuck at an airport, jogging, or waiting to meet someone.

Some of the best include:

"Reminiscences of a Stock Operator" by Lefever

"PitBull" by Marty Schwartz Get the used cassette tape version which is narrated by Schwartz.

"When Genius Failed: The Rise and Fall of Long-Term Capital Management"

"Liars Poker" by Michael Lewis narrated by Lewis.

Mark Fischer wrote "The Logical Trader" and also has a 3 day seminar on trading that can be found on the web. Great stuff.

http://tv.ino.com/premium/ has an incredible collection of trading seminars. Register and download everything by Linda Bradford Raschke, Larry Williams, Ryan Jones and many many others. A lot of junk on this site but also a lot of value. You would pay hundreds of dollars for this stuff at a seminar or at TraderExpo.

Many of the audio books can be purchased at audible.com. Their site and copy protection is annoying but the collection of content is the best there is. (Download and convert to MP3 quickly!)

I convert everything to MP3 format as soon as I get it using Audacity which is free and available from http://audacity.sourceforge.net/ The MP3s will play on any ipod and also on any smartphone. I load a 2GB miniSD card for my smartphone with the best of the best audio books.

Hedge Fund $50B Blowup

"I knew he was cheating, That's why I used him" http://globaleconomicanalysis.blogspot.com/ Madoff Madness:

"We're hearing that the smart money KNEW Bernie had to be cheating, because the returns he was generating were impossibly good. Many Wall Streeters suspected the wrong rigged game, though: They thought it was insider trading, not a Ponzi scheme. And here's the best part: That's
why they invested with him.
....
Madoff told senior employees of his firm on Wednesday that "it's all just one big lie" and that it was "basically, a giant Ponzi scheme," with estimated investor losses of about $50 billion, according to the U.S. Attorney's criminal complaint against him.
...
And at least three funds of hedge funds -- which raise money from investors and farm it out to hedge funds -- may have significant losses. Fairfield Greenwich Group and Tremont Capital Management of New York placed hundreds of millions of their investors' dollars into
funds overseen by Mr. Madoff. On Friday, Maxam Capital Management LLC reported a combined loss of $280 million on funds they had invested with Mr. Madoff."

He avoided reporting regulations and oversight by going to cash before the end of a reporting period and using a small accounting firm that no one had heard of....

http://finance.yahoo.com/news/For-Madoff-investors-big-apf-13823443.html

"He only had five down months since 1996," Gradante said. "There's no strategy in the world that can generate that kind of performance. But when people would come to him and say, 'How did I make money this month?' he didn't like it. He would get upset with people who probed
too much."
....
"He described a powerful word-of-mouth allure, where one friend after another recommended Madoff as a sure thing, someone who took on new clients only reluctantly and as a favor."

The best summary of events can be found at wikipedia:

http://en.wikipedia.org/wiki/Bernard_L._Madoff

=========
Impact:

1. People already hit by the downturn may result in more redemptions for other funds at the worst possible time for themselves and the hedge fund.

2. Increased regulations forcing more hedge funds to close and making it harder for new funds to start and grow.

Sunday, December 7, 2008

MacHedgeFunds

With the economy going south and news of 100's of hedge funds going out of business, or at least facing dramatic losses, there seems to be no lack of interest from individuals starting their own 'hedge fund'.

Now there is a web site that aggregates a lot of hedge fund info in a single place. Take a look at http://hedgefundgroup.org. On the site you can find a lot of reference materials and background information to help set up your own hedge fund. There are a number of videos and a large ebook of past postings to the site in an easy download.

Also of interest is the 'Chartered Hedge Fund Associate' designation, by joining CHA and taking a test you can be 'certified'.

Not for me as it seems there is plenty of leverage available for me without asking others to chip in. After raising money for a startup a few years ago I never want to take OPM again, and certainly not in this economic environment. But, for those that have an interest in Hedge Funds, this is the best site for information that I have found.

Friday, December 5, 2008

What kind of name is Gazooi?

Most people find a blog by reference from other blogs or from search engines. It would not matter what I name this site, I would have to 'brand' it as a new entity. So what is wrong with gazooi? "Gazooi" is only 6 characters and 4 characters are vowels (very hard to do and register as an available domain). Vowels are easy to say and although Google and Yahoo are good example of vowel rich domain names, Gazooi is better! Welcome to Gazooi, I hope you find something of interest here!