Benedict: How You Can Become a Successful Trader
Below, Larry shares a fundamental rule that defined his trading career 35 years ago. And it can help you profit today, whether you’re a short-term trader like Larry, or a long-term investor…
The year was 1984, and I had just started my trading career.
I worked as a runner, and a clerk, in the pits at the Chicago Board Options Exchange. And it was there that I learned the first, most fundamental rule of being a successful trader.
As a clerk back then, you would answer phones, write orders, and run the orders out to the pit to execute them. Then you’d get back on the phone and report the fill to the customer.
When I first started, I was getting trained by another clerk who worked for my boss. My boss was a big-time trader. And the clerk who was training me said something strange…
“Look, you’re going to get fired every day. But don’t listen to it. Come back tomorrow and everything will be fine.”
I’m from New York. And here I was… 21 years old, in a new city where I didn’t know anyone, and I knew absolutely nothing about my job. Not to mention, I was being told I’d get fired every day.
I didn’t know the ins and outs of working on a trading floor. I was expected to know what I was doing. But I knew nothing about trading, period. And on the first day, I got thrown right into the fire.
My boss was giving me hand signals for what trades to do from the pit, but I was clueless. They gave me a sheet with all the hand signals, but it was like having to learn sign language in minutes… I’d look up at the screens with the current stock prices, and it just looked like scrolling gibberish.
My boss really needed someone with much more experience than I had.
Inevitably, I messed up an order and my boss went ballistic. He told me I was an idiot and didn’t know what I was doing, and he fired me.
So of course, I freaked out. I called my mom and told her, “Mom, I just got fired. But they told me I’ll get fired every day and to just keep coming back.”
And she said, “Well, just do what they say then!”
So I went back in the next day, and I was there early. My boss walked in with a cup of coffee and a bag of McDonald’s, like everything was normal. He started asking me what I did last night and was in a normal, upbeat mood.
It was crazy. Everything really was fine.
The next day came around, and he asked me a question about adding fractions together. I didn’t know the answer, so I guessed.
Bad move. I guessed wrong. Then he went ballistic and fired me again.
Suffice to say, it was a high-strung and high-intensity environment. And as miserable as it was doing that every day, getting fired and coming back with my tail between my legs, I kept coming back.
Not a lot of people are built to handle that kind of environment. But you learn that way. You get knocked down and get back up, every single day.
That’s what my boss was trying to teach me, in his own strange way. And it’s a lesson every new trader needs to learn.
No matter how many times you fail… lose money… “get fired,” so to speak…
You have to get up, dust yourself off, and try again. That’s the only way to learn and improve.
It’s easy to get discouraged, especially when money’s on the line. But if trading were easy, everyone would do it and everyone would be rich.
Maybe the advice to “never give up” is something of a cliché.
But that cliché is the reason why I turned that first job into a 35-year trading career, making millions along the way.
And if you want to be a successful trader, you must follow it.
Editor, The Opportunistic Trader
• This article was originally published by Bonner & Partners. You can learn more about Bill and Bill Bonner’s Diary right here.