Profit 781%! A real market legend: from Marine Corps to gold trader

"By 1978, I had been a securities analyst for eight years. I'm extremely tired of this kind of work. I know it's time to make a change. I want to work only for myself, with no clients and no need to respond to others. For me, that's the ultimate goal. "—— Marty Schwartz
Martin Schwartz used to be the hottest gold medalist on Wall Street and a real market genius. He won the title of "trading champion" with super high profit rate, and his trading has never been more than 3% monthly loss. At the US investment Championship hosted by Professor norm Zadeh of Stanford University, his performance was amazing. He took part in nine out of ten tournaments in each four month tournament and made more money than all the other traders put together. The average profit of nine competitions is 210%! In another annual contest he took part in, his profit record was 781%.

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Life experience
Martin Schwartz graduated from Columbia Business School. He joined the U.S. Marine Corps in college. The life of the army made Martin Schwartz more rigorous and more confident of his potential. After leaving the army, he returned to Columbia Business School with an M.B.A. After graduation, he joined Kuhn loab as a securities analyst and left in 1972 to join another company.
Martin Schwartz tells a story of his time at the new company. He once wrote a bad report, believing that the stock market of hospital management industry was in a bear market. The report was routinely circulated among other analysts, one of whom revealed the report to a client because he was drunk. The client then began to spread bad rumors, claiming that a negative forecast report was about to be made public. So, before the report came out, stocks began to plummet. Martin Schwartz was summoned by the New York Stock Exchange to collect evidence for nearly six hours. After that, he lost the job.
This embarrassing experience left him depressed for a long time. After running out of money, Martin Schwartz decided to go back to work. That became a stain on him. People always said, "aren't you the one who wrote the report?" He found that once people think you've done something wrong, excuses don't help. With the help of his friends, Martin Schwartz got a job at Edwards & Hanly, and then worked as a securities analyst for two different companies in the next few years.
"After eight years of securities analysis, I feel extremely tired. My friends taught me how to analyze the market, so I always close the door of the office and observe the market alone. Soon after, with $70000, I switched to floor trading. " At that time, he was 34 years old.
Martin Schwartz's way of dealing
When Martin Schwartz was a securities analyst, his decision was based on basic analysis. Later, he became addicted to technical analysis, and in his work as a trader, he completely converted to a technical analyst. As he himself said, "it took me 10 years to become a basic analyst, but it took me 10 years to become a technical analyst before I became really rich."
Therefore, he believes that the trading method must fully match the personality of the trader. Just as Jim Rogers started with basic analysis, he suffered losses from basic analysis. Using other people's profitable trading methods does not necessarily make you profitable.
In an interview, Martin Schwartz once warned traders that it is very important to manage risk and learn to accept losses. He believes that most traders would rather lose money than admit defeat.
"It was only after I was able to separate my needs from making money and accept the false reality that I turned from a loser to a winner. Before that, it's more embarrassing to admit that I'm wrong than to lose money. "
Martin Schwartz believes that his experience in the Marine Corps has greatly helped his trading philosophy. He thinks it's meaningless to just accept the consequences of mistakes, and timely retreat is also a form of attack. "The most important thing is to retain the strength and give yourself the ability to start over," he said This has always been one of Martin Schwartz's methods of fund management.
Six trading rules that Martin Schwartz attaches most importance to:
"I'm not going to work against the moving average, or I'm going to destroy myself."
Try to follow the moving average in your own trading time.
"Before setting up a position, I always ask myself," is this really the position I want? "
Are you entering the trade based on signals or your own opinions?
"After a successful trading period, give yourself a day off as a reward."
You should learn to stop and enjoy the success of your work, so as to avoid overdraft and make yourself more motivated.
"Big profits are usually followed by big losses."
A series of profits is very dangerous, which will make traders inflate themselves, as if they know a lot, so they also trade more.
"Bottom selling is one of the most expensive ways of gambling."
There's a huge difference between buying on the cheap and "catching the falling knife.".
"Before you build a position, always plan the loss you are willing to bear."
Determine the largest possible loss before trading.