Trading Any Market And Rock Star Status

Trading Any Market And Rock Star Status

By W. B. Busin

Every industry, from Hollywood to Wall Street, has a succession “rock stars” pushed out to the public. In their own specific terms and methods, these “rock stars” rise upwards through various levels of name recognition. Their notoriety is often shaped by the publicists and public relations industry. The “industry rock stars” become known, then respected, then envied by their respective publics. The financial rewards are often extraordinary for these “rock stars”. It may take years for the rock star to reach a point of stability where they are allowed to speak and behave in an unscripted and normal way.

Current examples of industry rock stars are filling your minds, such as Tiger Woods in men’s professional golf, but possibly not names like Meg Whitman and Jack Welch in business, Carl Rove in government and politics, or Fernando Alonso. To their publics who have ‘discovered’ them, knowing how they got there is more for the satisfaction of their curiosity and not as a lesson for themselves.

That is, the real story is quickly discarded for the juice squeezed from the low hanging fruit of their current life, behavior and words. This is what I refer to as the “Now Funnel” of information, knowledge and understanding. Implied in the name is the pathological presence of a willful ignoring or trivializing of the history of each rock star’s marathon run toward achievement and the accompanying fame. Only the “Now” matters. The respective publics (fans) of rock stars want what they are. They say it as, wanting to be them, wanting to have what they have. And, they want it now, or, they want to be as close as they can be to that state of desired rock star status. The “Now Funnel” supplies seductive and available information continuously. Rock stars are in demand in countless ways: endorsements, interviews, photos, and autographs. They are expected to live up to each fan’s peculiar and nuanced expectations.

Trading in any competitive marketplace has similar deleterious characteristics. If a person is successful at investing or trading, they are compared to a Warren Buffet or another Market Wizard. When a “new” star emerges into the spotlight, people imperceptibly presume that they are owed a full accounting of their life story “Now!” The most interesting new stars are ones with long histories that people can relate to quite easily, aren’t they? They were waiters or convenience store clerks or an office worker. Observe the variety of jobs that the budding stars worked in before they ‘made it’ on TV’s American Idol.

So, I want you to look at a new star, a true “Rock Star” in an industry that is not a great American Tradition. I want you to follow what this very young man is doing to his industry. He exploded into the brightness last year. In 2005, he became the dominant factor, the guy to watch, and the man to beat. He won 7 races. I don’t want you to become a fan, though you might find a fair bit of reason to become a fan.

I want to use him and those involved in his success as an allegory for what is required to succeed in trading and investing. His name is Fernando Alonso. He is a Spaniard who drives a French Renault Formula 1 racecar. Look him up. Read about him. As I said in a previous post, he has it all. He has the looks, the innate bravado, the charisma. If it can be done in an F1 car, he can do it better, faster than anybody else.

This year he has won twice with a second place in just three races. Out of a possible championship 30 points, Alonso has 28.

The history part that is easily ignored is the better story for a trader. It is a story of a great car designer, of a brilliant crew of many, that provide him with the tool, the car, that Fernando uses to wreak havoc on his fellow drivers. It is a story of diligent imagination, creation, preparation and adaptation. Decades of auto science, design and trials have converged and produced a superior Renault racecar. After all the sweat and tears of years of work, they dropped this jewel of a racecar into the able hands of this formerly unfamous, unRock Star young driver.

In one season, he makes their work seem like the work of pure genius. He was the 2005 champion. He won seven races. He beat established stars. His name is gold. He is the Tiger Woods, the Warren Buffet of Formula 1 racing, and so very young at barely 25. He is a Rock Star, by any measure – even if you’ve never heard of him.

Find the lengthy paths preparation of the designer, the manufacturer, the crewmen, the details that converged to give Fernando the chance to become a Rock Star in his industry. Then watch him and his supporting cast as they destroy the competition. Listen to his fellow competitors talk about him the same way Tiger’s foes talk about him. “If Tiger doesn’t have a great day, then maybe I have a chance to …”

You may not want to be a Rock Star in trading or anything else. But, you can be whatever you want if you are willing to spend your timing investing in you. If you are willing to sacrifice the “Now” for the “Future Funnel” by learning, by educating yourself, by learning to suffer losses, by learning to win, by devising your plan of managing money, by reading and looking for nuggets instead of searching for the mother lode in the mine of trading.

Be careful of your weaknesses. Master them. Rely on your strengths. Channel those strengths. Devise your plan for yourself. Never let trading become a personal reflection of your real value as one of God’s creations.

You cannot trade and will not trade like anyone else. You must arrive at that convergence of concepts and ideas through your solitary experience. You must allow for time to provide you with experience and knowledge. You must resort to an obsession for learning and design. The more you learn about trading, the simpler learning about it becomes. You must decide to learn all things in your focus till the day you stop trading or investing. It will become a natural way to live and think. Then, it might just be possible for you to make a living at trading.

Profitable traders are as rare as good racecar drivers. Rich traders are as rare as Rock Star drivers. Both industries, racing and trading, have a high incidence of crashes. Many crashes have tragic long lasting results to the drivers and traders, and their families. All deaths are tragic in racing, as are the blowups in the trading and the investing world.

{This piece is dedicated to Paul Dana’s wife and family. He died going 200 miles per hour, on March 27, 2006. He was just beginning to live his second chance at the American Dream.}