一个投机者的告白

<<一个投机者的告白>>, and please don’t get it wrong as <<一个偷鸡者的告白>> because the risk involve as a speculator always larger than a chicken stealer, hahaha. Anyway, the author of this book was called Andre Kostolany, and I will briefly describe a little biography about this author. Andre Kostolany (1906-1999) was a world-renowned stock market expert and speculator. He worked most of the time in France and Germany. He originally studied philosophy and history of art in Budapest but his father forced him to abandon his studies and sent him to Paris in 1927 to work as a broker. He began his career as a speculator and arbitrageur, and he was able to make a profit of the decline in market prices which began in the end of 1929, which the market was bearish at that time. He remains the stock market guru in Germany and his many insightful books are still available, but not in English, and his best quotation is “Never run after a bus or a stock. Just be patient, the next one will come along for sure.” However, Andre Kostolany died in 1999, but his memory lives on in the German-speaking world.

Basically, this is not a book that talking about technical, fundamental, or emotion trading, however, it is a book for the author to share out the experiences being in this speculation line throughout the years. Actually this author didn’t really spend his speculation career in stock market only, he also did speculate on currency, commodities, property and so on. As long there is potential reward waiting for him, he will go for it, and this is the role of being a speculator. One of the quotations in the second chapter was writing like this, “people that got lot money can speculate, people that less money cannot speculate, people that no money at all must speculate.” And he defines people that no money at all is those can’t afford to buy property or even can’t take care of themselves when they are old. If no money, then work for money, and this is what he did when he become bankruptcy from a failure speculation and then he try to work as a broker and consultant to build up his capital again. He also mentioned as long as human still living in this earth, the opportunity of speculate is always there because no matter the gambler earn a lot or lost a lot in the market, they will always in the market, and this is the reason why financial market is the only industry never obsolete by the era changing.

There are some very interesting parts that get from chapter 7 which is psychology of trading. Author classify investors in 2 major category, 1 is stubborn type and another 1 is hesitate type. So he was saying trading is a game to make the stubborn type investors become winners in the long run and their achievement is the scarification of those hesitate type investors. What make the difference between stubborn and hesitate type investors? There are 4: money power, mind set, patient and luck. Money power is relating whether the investors trading with money that are not use for emergency, mind set is how creative is your way of covert your idea into action, patient is testing how you undergo those pressure when the market was moving opposite of your direction while luck involve changes of economy policy, war, and natural disaster. If an investor lack of any out of the four determinant, investors will easily become hesitate investors. It was so true during a retracement of the markets, lot of investors that don’t have much holding power and patient; they are easily shaking and choose to cut their loss fast. However, for those investors that have lot of holding power and patient, they will keep buying those blue chips stock and just sit there for the price to rise above their entry level. This only can apply in an uptrend market but not a downtrend, so investors should know clearly what is the current condition before they make a decision to holding their investment for longer time. It is definitely an interesting book to read if you prefer story telling that kind of book. Each successful trader has their own story and insight towards trading, I wish by reading those books, it able to let me develop some necessary skill to survive in market by adopting some valuable ideas of their experiences.