George Angell focuses on volatility and liquidity
Volatility and liquidity - two things that drew attention to the independent trader George Angell (George Angell) for trading. Currently, Angell trading futures only S & P 500, concluding only intraday trades and never hold positions overnight. "Liquidity and Volatility - is two things, without which it can not do. Trade something of oats in a single day will not work "- he said.
In the early 70s, Angell first became interested in commodities markets. "I bought sugar, and he took off into the price ... then I bought the copper, and it soared in price, then I bought some more copper. Then prices fell. I called my broker and told him to sell, and he asks - Who? - Says Angell. - It was then that I realized that I needed more study. " In the early 80's, Angell went to the Chicago exchange facilities. He was a local trader for U.S. average Mercantile Exchange (MidAmerican Commodity Exchange), dealing mainly with gold. Although Angell now trades for himself, not in the hall, and on the computer screen, he considers the traditional trades in the hall "an invaluable experience."
"People in the room focused on near-term - Angell said. - I learned how to enter in time, to grasp the trend to make money and leave. " Now, however, he prefers to trade outside the stock exchange. "I am alone in the room engaged in trading. When I enter the room, there are thousands of people. This is a secular event. People want to talk about their positions, drinking coffee. Because of this, can not concentrate ... as they say, because of the trees of the forest is not seen. " According to him, over the past ten years, advances in technology has revolutionized the possibilities for trading. "All the players line up the chances," - says Angell. According to him, technology has eliminated the advantages that, as previously thought, a trader in the room was compared to the OTC. "From that first won widespread trader. The general public does not know how to speculate with a small profit, "- he explained. Angell rejects the basic knowledge that absolutely rely on technology. He has developed two own trading systems: LSS and Spyglass, which uses in its daily operations, along with "caution and personal experience."
"Everyone needs some automatic huge. It allows you to take on difficult transactions for which no one would take pencil in hand, "- said Angell, adding," Every day I go to work without any opinion drawn up in advance ... tells me the market itself, where it seeks the views of ... - this is what leads you. " Although "many people lack the discipline to trade without stops," according to Angell, he does not use them. "The problem with stop trading is that you come at the worst moment of all. Instead, I use the stop point of action. This means that when the market reaches a certain point, I go out, but I'll wait for the jump (if the market falls), "- explained Angell.
Angell was engaged in trading and in the bond market. In its assessment of markets, he relies on two key elements: the volatility and liquidity. "Sometimes the market for you just die. For example, in 1980 there was a large market for gold. The price rose to $ 850 per ounce, but volatility is lost, and then vanished and liquidity. At this point I switched to bonds "- Angell said. When the Chicago Mercantile Exchange contract was launched S & P 500, Angell began working in this market. However, he said, after the stock market crash in 1987, the liquidity of the S & P has disappeared, and Angell returned for a time to bond. "Bonds are trading large institutions, and at each mark (tick) can be bought and sold thousands of them. No one can play with that market. No one can manipulate it. That's why orange juice all the time reaches the upper limit - because there is nobody to sell it "- he said. When asked about the bidding system GLOBEX, Angell said, "I do not pay any attention to them, because there is not enough liquidity. On Eurodollar there is a huge liquidity, but not enough volatility to make money. "
Regarding the differences between markets, Angell said that "all markets have different characteristics and should be good to know your market. The man in the hall, selling timber, not to trade the S & P. And traders behave in different markets in different ways. People are aware of how they are trading. This guy - scalper. This remote trading months (back months - months, the most distant from the expiry of the futures or option). This guy specializes in spreads. This is a one-day position. The novice trader needs to know that he needs a specialty. "
When asked why many futures traders do not succeed, Angell pointed to three main factors: "Firstly, the lack of discipline. Second, the lack of finance. Third, they generally do not understand. They do not represent a paradox. " A dictionary definition of the paradox - is a "clear conflict", but it explains Angell, applies to this situation. For example, "to market the whole thing is then to get around the foot. Everyone thinks that the price goes up, but not everyone will earn money. "
Advice for beginners? "Place adequate funding. You must be undertaken with risk capital you can afford to lose. Do not think about money, think about the market and the money take care of themselves. "