Self-discipline is the key to success

Self-discipline is the key to success. This is true in any game. Knowing the rules of the game is a prerequisite for success, but it is not enough. The one who defeated himself wins!

In the world of traders, Vivian Blumenthal knows him for having developed his own principle of trading on the floor, which is now widely popular. This trading strategy is to open a new trade if the trend turns up, and immediately close it as soon as the rate declines. There is no need to react to short-term price fluctuations, the primary goal is to maximize the coverage of a long-term upward trend.

Professional trader - the way to the top

Richard Dennis began his journey to trading at 17. To productively wait out the three months of vacation between his undergraduate and graduate studies, he got a job as a messenger on the trading floor of the Chicago Board of Trade.

Trading on the stock exchange was only possible from the age of 21. Since Richard, because of his age, did not take part in the auction, he gave stock orders at the current rate to a figurehead, whose role was played by his own father.

As a result, Richard could earn $ 3,000 and plan for himself the basic principles of the original trading model. After reaching adulthood, he officially got a seat on the exchange and began trading small contracts. At 25, he made his first million thanks in large part to betting on the highs of inflationary markets in the 1970s.

$175 million dispute

In 1983, Richard Dennis made a symbolic one-dollar bet with millionaire William Eckhardt. The latter was of the opinion that only people with developed natural intuition can work in the market, while Dennis intended to prove that any random person from the street can successfully work on the stock exchange with basic knowledge.

 

While on vacation in Asia, Richard Dennis visited a turtle farm. There he watched with interest the stages of development of turtles from the moment of birth. Based on the experience, Richard named the rookie group the Turtles.

He published an ad in the newspaper in which he offered anyone a small salary and, most importantly, the opportunity to learn how to trade in the stock market. Candidates were asked to solve a number of test problems to determine the level of intelligence and pass a personal interview. Based on the test results, Richard Dennis selected 23 people for the focus group.

The Turtles team consisted of an actor, a security guard, an accountant at an accounting firm, a recent high school graduate, two aspiring traders, a financial consultant, two card players, a graphic designer, and two women. The latter was considered a great rarity since at that time only men took part in trading.

The training program was designed for two weeks. The principle of the Turtle trading strategy was based on maintaining long-term positive trends. Richard Dennis explained to his students the benefits of aggressively building a profit vertical by adding bets to get more profit. It was necessary to suppress unprofitable transactions at the very beginning, without waiting for large losses.

 

The training has given its positive results - since 1985, the Turtles have been receiving steadily increasing profits from transactions. Within 5 years, they earned $ 175 million, thereby recouping the start-up capital invested in them with interest. In 2007, one of the project participants wrote the book “The Way of the Turtles. From Amateurs to Legendary Traders ”, in which he detailed the basic principles and features of the knowledge gained.

Age does not matter

Until the last day, Richard Dennis continued to work actively. He served as president of Dennis Trading Group Inc, served on the board of directors of the Cato Institute, and served as vice president of C&D Commodities. In parallel, he acted as co-director of the strategic macroeconomic development program at the center, where a practical analysis of various economic strategies is carried out.

By 2000, Richard Dennis' total net worth had surpassed the $ 300 million mark.

Among other things, the legendary trader worked as a junior editor for Economic Review magazine and regularly published his articles in such major publications as the Chicago Tribune, The New York Times, and The Wall Street Journal, which daily circulation exceeds a million copies. Richard Dennis also took part in the social life of society - he supported the non-profit organization Flex Your Rights, which is an open platform where the constitutional rights of every citizen are explained to help in clashes with law enforcement agencies.

He died in 2012 on September 17 in Sandwich, Massachusetts. However, after himself, Richard Dennis left a lot of works, notes, and training programs that can not only interest but also indicate the right direction on the path of becoming a trader. And most importantly, he gave confidence to the future generation that everyone can become successful, there would be a desire and willingness to work hard to achieve the goal.

Basic trading strategy solutions

Richard Dennis advises novice traders to adhere to a number of basic principles on which anyone can build a successful model that brings stable income in the long term.

 

The quieter you go, the further you'll get

 

You should never rush. Those who are just making their first transactions on the stock market should always take into account their mistakes, which will certainly be due to the lack of practical experience. In this case, you need not to dwell on them, but on the contrary - to carefully disassemble and learn not to allow them in the future. At the same time, it is worth cultivating a retrospective perception of the market in order to understand global trends, gradually increasing their narrow analysis of single transactions.

 

He does not take risks, he does not drink champagne

 

When working on the market, it is necessary to take into account all the existing factors that may affect the profitability of the transaction. This approach will allow you to clearly highlight the option that will be guaranteed to be winning at the moment. This does not mean that 100% of the deals made should give a guaranteed profit - 5% of successful contracts are enough to ensure consistently high profitability.

 

Nobody is immune to mistakes

 

When working in the stock market, you should always keep an eye on the underlying trend trends. This is done in order to timely mark the initial phase of destabilization and fixes positions in order to minimize possible risks from the incipient drawdown. In the event that there is no way to avoid large losses, it is necessary to exit the market. However, before resuming trading, it will be advisable to pause in order not to get involved in the destructive pattern of behavior that often occurs in such cases.

 

The study, study and study again

 

The market does not stand still and is constantly evolving - new packages of securities appear, trends are updated, investments are redistributed, etc. Therefore, the trading strategy used should be as flexible as possible and quickly adapt to changing market realities. For this, it is necessary to constantly improve oneself, to study new software solutions and techniques of both fundamental and technical analysis of the market.

The legacy of Richard Dennis

Books are written by Richard Dennis:

            Red Ink: A Guide to Understanding the Deficit Dilemma, 1985 - Co-authored with Harold Hovey.

 

            Instability Under Nominal GDP Targeting: The Role of Expectations, 1998 Conditionally Optimal Rules in a Simple Closed Economy Model, 1999.