163: John "Rambo" Moulton – An Evening with a Veteran Trader [LIVE]

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Hey ladies, hey gents, I'm Aaron Firefield and welcome to a special episode of Chat with Traders Podcast. This episode was recorded in june twenty eighteen in front of a live audience in Sydney. And it's a conversation I had with John Moulton, though most will know him better as Rambo, particularly those who used to trade with him in the pit. John's a serious trader, and for good reason, he's considered to be somewhat of a legend trader here in Australia.

In short, John left the Chicago trading pits in the 80s, bound for the Sydney Futures Exchange. And in the years that followed, he became a very large spread trader of government bonds and bank bills. He was responsible for a major share of the trading volume done each day. Now forty years on since placing his first trade, John is still an active market participant.

trading from a coastal location in Queensland, Australia. There's only been one other time in John's career when he's done any sort of media, and that was roughly 20 years ago when he featured in a documentary about the Sydney Futures Exchange. So it's very cool and a true honor that he was willing to take part in this and openly share his market wisdom. Also, if you'd prefer to watch this episode rather than listen to it as a podcast, you can find a video on the ChatwithTraders YouTube channel.

By the way, I will say sorry my audio's not crystal clear in this episode. Like I mentioned, it was recorded live, but John's audio is pretty good and that's what really matters. On that note, I present to you John Moulton, aka Rambo. This might be somewhat of an unconventional interview. I'm not sure exactly how it's gonna go. I know John has some of his own ideas, um, but I'm probably just gonna start by asking a couple questions. We'll see how it goes.

Okay, because you have a bit of fun, you might ask, the audience for a few questions, um so you know, be alert, he might fire something your way. Um but yeah, I mean John, tell us a little bit about how you actually got started in trading. I know we're going back to the eighties. We won't spend too much time on this, but just a bit of context for everyone in the room. We're actually going back to the seventies.

Okay. We keep going back further. Um well yeah, fill us in. Bring us up to speed. Like where did you Get your start. We we trading in Chicago? Alright, we're gonna keep this brief because I don't want to talk about myself too much. I'd rather talk about what's happening right now with these people here.

So I'm happy to do this for a couple of minutes and that's it. I started trading at the Mid America Exchange in January 1978. The Mid America Exchange is an exchange in Chicago that wasn't one of the primary exchanges. The primary exchanges were the Chicago Mercantile and the Chicago Board of Trade. Chicago uh the mid American exchange traded in smaller increments, so it was a much uh cheaper way to get involved with trading. Uh for example, I wanted to trade soybeans.

At the Board of Trade, soybeans have traded five thousand lot increments. Five thousand, ten thousand, twenty-five thousand, six hundred and thirty-five lots, everything's increment of five thousand. At the Mid American Exchange, everything was one thousand. So you trade a one lot, a two lot, an eight lot, a twelve lot.

The prices came across on a price jet. These prices were being set from across the street from the Board of Trade on a price jet in a random sequence. And we bid and offered basis the prices we saw coming across on a price jet. Really crazy shit. Hard to believe nowadays, isn't it? Anyway, that's where I started. Trading ones and two lots. In these little contracts at a Mid-American exchange where the seats cost$12,000. My mother gave me the money, and I put$2,000 in a trading account.

There you go. That's how I started. Two thousand dollars. So, I mean I know you don't want to spend too much time on this, but it's uh incredibly impressive that you were able to uh you know A l at a later stage, like I'm sure if there was a few years between that point and when you became a very large portion of the volume that was done on the Sydney Futures Exchange, like, how did you work yourself up to that point?

Uh well for f the we're talking about floor trading. Right, right. Floor trading. Um I was tailored made to be a floor trader from this big At university, I scalped tickets to all the football games, basketball games, hockey games at the University of Wisconsin. I was a ticket scalper. I played poker till four o'clock in the morning. I loved taking risks. And when I first saw the Futures floor, I knew that was my destiny. As simple as that. But how did you scale up?

Big balls. I I was always an over trader. I should have been trading five lots, I traded twenty lots. I should be trading twenty lots, I traded fifty lots, I should be trading fifty lots, I traded two hundred lots. No fear.

And did that ever hurt you at any point? So I imagine you catch it. Oh yeah, yeah, yeah. I went broke a few times. Sure. You went broke. You lost all your money. Yeah yeah. How many times did that happen? Twice. Okay. Can you walk us through what maybe led you to blow up?

Like I know you said you were trading too big a size. Yeah. Well it c it catches up to you. I mean when you first start learning how to trade, and all you guys are traders here. Anybody here not a trader? No, nobody. That's good. Um I'm in a room of traders. Everyone here knows this. You start out small and you work your way up.

Right? That's what you do. You start really small and you work your way up. It's like climbing a ladder. Two steps up, one step down. You're used to trading a five lot, say say for example. You're used to trading a five lot. The first time you try to trade a ten lot, you're gonna lose. Every time.

Okay? Then you you so you say, Okay, but I know how to trade a five lot, so you go back to trading a five lot. Then a month or two later you say, I'm gonna have a go at that ten lot now. And this time it works. And then you go, okay, I can trade a ten lot now and now I'll try to twenty lot. First time you try a twenty lot, you lose. And so on and so on and so on. So, you know, you gotta learn how to lose. I'm sure everyone in this room knows how to lose, right?

It's very important. I want to talk about this later. Losing is extremely important. Winning's easy. is the key to trading. Your turn. When you went broke those couple times, were you ever did you ever doubt yourself that you could make it as a trader? Like were you contemplating whether you should maybe look for a different career? Never. You're in your twenties and and I just had a lot of self belief.

A lot of self belief. It's a real it's actually interesting looking back on it because it's a real balancing act between believing in yourself. and and having a bit of an ego. but not being too big of an ego where you are your own worst enemy or you get greedy And shit like that. You just have to you have to really know yourself. And the sooner you can get a real handle on who and what you are, you play to your strengths. And you work your weaknesses out of you.

Okay, so after those couple of times you went broke, was there a point where things began to click for you where you feel as though, okay, I'm not going broke again, I'm Uh like what changed? What changed to stop you from going broke? Oh well I I'll give you an example of one of the times I went broke. Okay?

I bought a board of trade seat in January nineteen eighty. I was sponsored and it was a co-signed loan with a gentleman by the name of Bob Collins through the Continental Bank in Chicago, the now defunct Continental Bank in Chicago.

And at that time I had about twenty five thousand dollars a seat at the board of trade. You couldn't rent seats in those days. The only way to gain access to the floor was to buy a seat. The seat at that time was about two hundred and twelve thousand dollars, a lot of money in nineteen eighty. I had a bid in for the seat of the third week of January of nineteen eighty, and that weekend Bill Clinton put a grain embargo on with Russia.

No trading any of the grains Monday, Tuesday at the Chicago Board of Trade. I went, shit, these seats are gonna head south. I went in, tried to cancel my bid for the seat. I you know, as soon as the doors open, the Board of Trade in there, cancel bid, cancel my bid. My bid had already been hit. Two hundred and twelve thousand. By the end of that day, seats are trading for one hundred eighty five thousand, right? Over the next six months, seats went down to one hundred and thirty five thousand.

Now I'm in at the price up here. Most of the money's borrowed. And then to add injury to add insult to injury, uh I wanted to be long soybeans. I I I saw a spread between soybeans and wheat and I wanted to be long soybeans and short wheat, right? It's just a spread I wanted. It wasn't working. It wasn't working. By mid June of that year, I was about thirty thousand dollars in the hole.

From my in my trading account. You have to understand in Chicago you can trade with a debit. I know it sounds crazy, but if you're a member of the Chicago Board of Trade or the Chicago American Steel Steel Exchange, they gave you the grace of trading with a debit. Everybody did it. They just did it. There was just old fashioned shit. That's what they did. So I walked into Bob Collins' office and I said

I was about to say mate, I didn't say mate. I said I said to Bob, listen, I can see that my account's debit and it organized to go to Europe to play golf with this friend of mine I knew since high school. He was number one man on the Northwestern golf team for four years. And for six months before that, we'd organized this golf trip in Scotland and England for the first two weeks of July.

And I said to him, Listen, I'll cancel this trip'cause I can see I'm in a hole here. I'm I'm broke. And he's looked at me and says, John. Don't worry about it. You go on your golf trip and you come back and start trading whenever you want. I was like, wow, that's cool. Okay, I'll go on the trip. And I left along a little mere little three lot at the Mid America. I was along three thousand bushels of soybeans, right?

In the two weeks I was in Scotland, and you have to understand, there were no cell phones, there was no telephones. I was getting uh my price dissemination was coming out of an orange newspaper that came out of London that was called the Financial Times. And it was on it was on a day and a half delay. By the time I got back to Chicago, my little three lot had paid for my holiday. We're in the midst of a massive bull market and between the second week of July and the first week of September.

Not only was I out of debit, I had my seat paid off. Just real quick, can you explain how the seat situation works? Like why did you need a seat, just for a little bit of context for everyone who's unfamiliar with how that all works? I'm gonna sound like an old fuck now, sorry. Um in those days in those days the only way you could really trade was on the floor. Otherwise you're sitting in a broker's office looking at price information that's anywhere from five to ten minutes old.

Okay? You know, like if you want to if you're just a position trader and you and you just wanna have a position, that's fine. But if you want to be a scalper, a day trader, you had to be on the floor. You just had to be. Were you always a day trader from the get go? Like that's just naturally what you gravitated towards? Absolutely, scalper, day trader. Yeah, okay.

Um, let's go back to the point you made where you spoke about how it's important to lose. It sounds like you've got a few things you wanna say about that. So um let's hear it. Well, it's just my observation the last couple of years of my life that um A society in general doesn't really teach people how to lose. They teach you how to win. Winning's easy. Everybody knows how to win. You know, they see LeBron James win a basketball game, making the last shot. He knows how to win. He's a winner.

Winning's easy, but is there anything in society that teaches you how to lose? Is there a course at university you take that says, hey, come take this course, we're gonna teach you how to lose. Engineering. There is what there is one thing that will teach you how to lose and that's organized sport. Because in organized sport you will lose. Okay? That's the only thing I can think of that teaches you how to lose. Other than that, you have to figure it out for yourself.

You really do. And losing is ex in how you deal with losing is extremely important in trading. Because winning, I'm telling you, is easy. That's easy. It takes care of itself. The key to trading is learning and figuring out how to take a loss and how you deal with that up here. Do you hang on to it and let it bother you, or do you release it and let it go? All I can say is is that you need to learn from the tr when you're trading you have to learn.

And you can learn from them from being correct and say, I did that correct, and you learn from that. And you can also learn from when you lose. And when you lose, you have to experience the loss, feel it. And spit it out and let it go. And focus on the next trade. If you hang on to a loss too long it will pollute you. It will not allow you to make the next trade and you have to focus always on the next trade. The next trade is the most important trade in the world.

Not the last trade, or the trade before that, or the trade before that. Just let the trades happen and focus on the now of trading. Do you have the belief that each trade is individual of itself? Like there might be times where you're actually going through a rough period. Um, do you still treat Everyone's so negative. I w I don't want to use the word high frequency because you guys have algorithms that are high frequency trading algorithms.

And I'm more of a hands-on trader. And what I'm always doing is I'm focusing on the next trade. I don't think about the trade before it and and I'm not analyzing the risk I just took with that previous trade. It's just a fucking trade. I don't care. You know, it's just put it in the books. Let's get on to the next trade. And because I'm mainly a spread trader, so I'm buying here, I'm selling here, I'm trading twenty different things all the time on the bid and offer, blah blah blah.

A lot of times I have no idea what I'm doing. I'm just trying to make good trades. And then and then the market closes and I go, I wonder what my position is. Let's try to look at that position calculator. I look at the position and go Well, okay, I'll get that up on the chart, I'll get that up on the charts and see if that looks good. Oh yeah, it looks good on the charts. I like that position. I might keep that for a day or two.

You know, like what motivates me to make trades is is is when I'm looking at the markets is a lot of different things. It has to do with relative value. Uh it it has to do is there a buy program in the ten years, is there a sell program in the ten years? Are these spreads reaching historical levels? Are we getting near expiration now? These spreads historically have a tendency to move a certain way going to expiration. So there's a lot I'm thinking about when I'm making treads.

When you're talking about learning how to lose, I mean, I know who who's who here has been trading let's say less than two years? Who's been training for more than ten? Woo. Cool, young crowd. That's cool. So I imagine especially for newer traders that's a very strange concept to put forward. Yeah? Learning how to lose. How would you actually know if you've learnt how to lose? You stop doing it.

You you you don't lose as much and you lose less frequently. And then you say to yourself, Ah, maybe I'm getting this now. Okay. Um but you're gonna lose. So I I don't dwell I once again I'm repeating myself, but I I I I I'm so focused on the next trade. This is real Zen shit man. This is like living in the now and spitting out what's happened in the past.

If you're a Zen Buddhist, if any Zen Buddhist here, you'll make a fortune trading. So what you're trying to do here is you're trying to focus on the absolute moment of the price information that you're getting off the screen. And that's what you're focused on. And everything that's happened before that, you can look at it later, but if in an active market when you're trading, you want to be focused on the now of the price section that you're looking at.

And if you're dwelling on other things that have happened in the past It's gonna it's gonna keep you from from doing that. It's as simple as that. As far as losing is concerned, I mean y you know, like

When do you really actually realize that you've lost money? Well, it's when you get your statement the next day and you look at the total equity at the bottom and you say, fuck, I lost money yesterday. But I but I don't I don't do that. I've gone months and months without looking at my statement to see if I've made or lost any money. I've gone months with that.

One of the things when I first started trading, like a lot of you guys are new traders, I had to keep track of how much money I was making a daily basis. I used to go from Chicago on the Chicago Northwestern trade up to Lake Forest every day. It's about a forty-five to an hour uh train ride, depending whether I'm taking the express trade or not. And I'd sit down, I'd count every trade I made and figure out exactly how much money I made or lost on the day. I did that for a few years, right?

So it's an evolutionary thing. When I first started training I really wanted to see how I was doing on a daily basis, right? It was important to me. Then I realized after a period of time that it wasn't so important. Then I got to a point where I said, actually, if I can completely divorce myself from money, I'm going to be a much better trader.

I know that's hard to do, but I'm telling you now, if you can if you can get away from the money aspect of trading and just focus on the market and making good trades, you'll have l you'll be distracted by less things.

There you go. I mean I I just I'm at a point now and I have been for about fifteen, twenty years, where I just don't care about the money. I I get a monthly statement now, I'll look at a monthly chart of where my equity's been and that's it. I don't look at daily statements, I look at nothing.

I'm focused on my on my position and the trades I want to make the trades I'm making. I feel like in your answer there you may have um well this may be a good point for me to ask you about your comet analogy. I don't know anyone who's seen the bulls and bears uh documentary, I think it's in the one of the opening scenes, isn't it? Oh yeah, yeah, gosh. So

Let's um let's let's hear a little bit about the comet analogy and um how that applies to your trading. Well it it's kinda like what I just said. I mean the tail of the comet is looking at charts. And I'm a chartist. I love charts. That's why I don't listen to fundamentals. I if if the nonfort payrolls are coming out, I don't go what's number what's the number? What's the number? What's the number? I don't give a shit.

I can see by the price action of the 30-year bonds in the States what what what you know whether it was what it's done to the market. I'm only interested in what it what all this information is doing to the market. So with the comet analogy, and by the way, that's my old material. I got much better stuff than that. It has to do with like the tail of the comet is what you can see when you look up in the sky. And just like you can look at historical charts.

You know, you can look at the daily bar chart and you can see what it's done, going back as far back in time. But that comet's moving, just like the prices that you're trading are moving continuously, moving across that screen. Prices are changing, prices are changing. And looking at the historicals is okay, but really trading is about being right there. in the momentary instance of price creation, being involved with the second by second price creation.

And that's the front of the comet, I suppose. Um so do you have a new anal analogy for that? No. No, no, right, not off the top of my head, mate. Okay, sure. All right, well let me ask you, I mean, are there some subjects which you might like to talk about? I mean, I think maybe we can tap into how long have you been trading? You said you started in the seventies.

Just over forty years. Okay, forty years. So, you know, let's let's make the most of that and tap into some of the the insights which you've gained over that time through um hard lessons learnt, etc. I mean what what are some of the lessons I know this is a really cliche sort of thing to say, but given someone like yourself who's been doing this for forty years, I think it might be an interesting subject to go into.

What are some of the lessons which you would like to pass on to a a younger group of traders? Believe in yourself. Self belief. Real big. Real, real big. Don't quit. And never lose all your money. It's like a poker game. You lose all your money, you have to leave the room. Go away. Come back when you have some more money.

So yeah, that's just very simplistic things to say, but it's it's really true. Stay in the game and really believe in yourself. It's it's um it's a real balancing act between having too big of an ego and not having enough of an ego. You know? And you gotta know yourself really well. You gotta know what your strengths are and you have to know what your weaknesses are. And it's a real game of inner exploration up here.

And I find it interesting now we're all trading from screens. The screen's over there, and I'm here. You want to externalize the experience of trading? Real easy. The screen's over there and I'm here. But you shouldn't be doing that. You should be internalizing the experience of what you see on that screen into here. Internalizing it. It's not you against the machine. The machine should be part of you

Metaphorically. I suppose its viewpoint one of the things I would like to talk about a little bit is observational skills. In order to be a good trader, you really need to work on your observational skills. Very important. You need to notice what the market is telling you. I don't make a whole lot of decisions on trade I'm not gonna I don't sit there and go, Um, you know, based on the charts, the ten year bonds are going to this level.

I let the market tell me what to do. I don't buy the bonds unless the market's yelling at me, buy the buddy bonds, you idiot. And then I buy them. Because I let the market tell me what to do. I uh I kind of divorce myself from My opinion. And I let the market tell me what to do. My opinion is guided by what the market is telling me. How do you find out how do you figure out what the market is telling you? You have to watch it very closely.

But not too closely. Sometimes you can defocus from it and sit there and let your eyes drift away from the screen, and your subconscious brain will be picking up on what's there. And you look back at it and you go, I know what to do now. Use the power of your subconscious mind, your intuition, and your your the power of observation. Will really, really help you. Intuition, observation, really, really potent tools for being a good trader.

How do you learn that stuff? Is it purely from sitting there in front of the screen and just building up your screen time? Or are there exercises you can do away from the market which you you practice your power of observation every second of your life? I'm looking around here right now and I can see these wooden rafters, I can see the lights over there, I can see about how many people are in this room. My eyes are wide open all the time and I love looking around.

I love just walking on the beach with my eyes open, looking up at the clouds at nighttime, looking at the stars. Just use your power of observation continuously in everything you do in your life. Every waking second, notice what's around you. Use your observational skills. Then when you look at that computer screen, it's gonna be so much easier. to look at it, focus on it, and make decisions.

So you have to practice your observational skills. Especially nowadays with social media and everyone on I mean I was a I was in the airport this morning. I mean everybody's on their bloody iPhone, a computer screen. Like put it away and have a look around. If you focus all your attention on one thing, you're not doing it justice to your brain. Let your brain work the way it was intended, the way it was made for you.

Utilize and hone your observational skills and let your brain do what it wants to do. You're gonna be your your brain wants to be flexible. Your brain wants to work for you. It can't wait to make great trades for you. All you have to do is let it do its thing. Don't stand in the way. What does this mean? Oh, you have to have a really open mind. You gotta be non-judgmental. You have to um open yourself up to everything.

and utilize the fact that your spirit inside you wants wants to be open and and free. I'm getting really philosophical here but I We all have it in us. Every single human being can be a a good trader. I have absolutely no doubt about that. It's inside every one of us. We we just gotta learn how to how to how to find it, dig it out, and don't let anything stand in the way. Don't let any dogmas come in between you and yourself.

Get to know yourself really well. It's a great thing about trading, guys. You're gonna get to know yourself really, really, really well. And you'll become a better human being for it. Our life lessons I've learned from trading have manufactured me into the person I am now. And I like who I am, and I like to think I have an open mind, and I like looking at things. Amen.

And I like life. I love it. Th these institu um intuition and observational skills which you talk about W when do you feel as though, like if a trader is there watching the market every day, how long If they're doing this day in, day out, do you think it should take for them to sort of feel like they're as cheesy as it sounds, almost like one with the market, like they can really feel when it's screaming at them, telling them to buy the ten year bombs or when it's a big thing. Well, you'll know.

You know, it'll just pop in your brain, you know? A lot of times, not all the time, but sometimes, I'll be just sitting there and I'll just kind of go into a bit of a zen moment and I'll empty my mind out of all thought. And I'm not kind of focused at the screen, but I'm not really focused at the screen. But I know that my subconscious is looking at that screen. I'll just kind of zone out for ten minutes, empty all thoughts out of my brain. I'm in front of the screen.

All of a sudden I'll come out, I'll look at the screen, I go, I know what to do. That was so easy. Practice a little bit of meditation. Learn how to empty all fucks out of your head. Are you you guys anybody here have a sleeping disorder? No, don't have a sleeping disorder, they're really bad. Learn how to completely empty all the thoughts out of your head and then you can fill it up with the ones that are important. And if you're a trader

Okay? Let it flow out of ya and fill it up with whatever you want looking at that screen and your brain will do it for you. It really will. The trend is your friend, the market will will show you its direction. It'll it gives you little clues. I was talking about this with a bloke from Macquarie Bank today. Anybody here trade the three year bonds against the ninety day bank bills in this country?

There's one there. There's a couple over there. Good on ya. Good on ya. I trade that too. Um in August eighth, ninth, and tenth of two thousand and seven. There was a major divergence between the ninety day bank bills and three year bonds in this country. To such a point that I was flabbergasted. They were always the price relationship always moved within a certain band and now it had just gone ballistic. The bank bills were losing against the three year bonds massively.

I called up one of my friends in Sydney and I said, What's going on? He said, Well You do know what you're trading, don't you? And I go, Yeah. Of course I know what I'm trading. He goes, Well, tell me what you're trading. I said, ninety day bank bills. He goes, Ninety day bank bills. I went, yeah. And and what's the thing you trading? I said three year government government bonds. Right. So the banks are in trouble. Would appear the markets telling us that the banks are in trouble?

And people are fleeing bank debt and go moving it into treasuries. Safe haven stuff. This occurred Thirteen months before the stock market crash. Completely tipped the whole thing off that was going to happen. If you were listening and watching the market, you would have seen it and you would have said, Bloody hell, something's good, something's up here. Something's up. I'm not making this up. The market was just saying that to me. Something's gonna happen here. Okay.

So the market the market will will really help you out if you watch it and listen to it. It'll show you direction. That was that was monumental. I mean it's one of those things that I'll always remember for the rest of my life. What year was this? August nine two thousand sorry, that two thousand and seven. August two thousand and seven. So it was a full thirteen months before September two thousand and eight. When I shit at the fan. How did your trading change during that period?

Well, that's another thing with trading. You have to change with the markets. I don't care what algorithm you've built, you've built a black box. If that thing doesn't morph with the markets, you're doomed. You have to I and I have nothing against people with algorithms and and trading systems that that they plug in and just the computer does all the work. There's nothing wrong with that. But

Most of them over long term over a very long term stop working because the markets are always changing. They do. They they completely change. You know. In twenty eleven Exchange called me up and said, Are you worried about these algorithms that are coming to the market? I said, No. Why should I be worried? Only three things you can do buy, sell or do nothing. And now it is unbelievable. Like like you have to have an algorithm to trade. You have to.

तो तो तो तो तो तो तो तो So you have to you have to change with the market. And if you are stubborn or you're close minded It's not going to happen. Very, very important to change with the markets. What did I do in that scenario? I stopped trading the spread. It was out of control. And I had no idea where it was gonna go next. So you were taking more directional trades? Well no, I stuck the bill spreads. Okay. And trading the curve. Right. Okay.

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I think a subject which would be really interesting, I know you kinda hinted on this a little earlier, is um your appetite for risk. You said it was kind of natural from the beginning. You had this this appetite for taking risk. Uh to a lot of people that probably doesn't come quite so natural. Do you think it's something which can be learned? It's only risk. If the firm you have money with is demanding margin money from you then it's risk. But if I'm asking you for any money, who cares?

Is um is that possibly why you blew up those couple times? Probably. Probably. I've always been very lucky. They've always allowed me to over trade, because I'm a classic over trader. I always traded far more than I should. How do you know when you're over trading? Like you just do huge volume naturally. I mean'cause I only have a hundred thousand dollars in the account I'm trading thousand lots. There we go.

Um and going back to an earlier point you said and I I should not gloss over this'cause it was a pretty bold statement, you said you must have an algorithm to trade. I don't. I know, but what what made you say that? Because because it's it's it's um it has to do with assuming risk or taking risk. Do you guys know the difference between assuming risk and taking risk? Anyone want to have a crack at this one? What's the difference between assuming risk and taking risk? Anybody?

Okay. I'll explain to you real simple. A casino assumes risk. You walk in the door of a casino, it's sitting there with its doors open, it knows the odds are in its favor and it can't wait for you to come in and bet your money. You're taking the risk and they're assuming the risk. They're happy to do that. Okay?

For a lot of my life as a trader, I was the one assuming the risk. I didn't care whether you bought or sold from me. I'd make a market and do I don't care, buy it from me. Good luck. Sell it to me. Good luck. I was making a two way market in everything. Because I had had built into my head an uh a the idea that I was getting an edge when if I could buy at this price or I could sell at this price. I was getting an edge.

Those edges don't exist anymore. Especially in the fifth, sixth, seventh, eighth bill month. There's always three to five hundred on the bid and offer. So, you know. In in nineteen eighty nine, you know, how's the fourth bill month, John? Eighty five bit at ninety five. What do you wanna do? How hard's that to do? Now it's eighty eight bit at eighty nine, five hundred aside.

So unfortunately, because I don't have an algorithm, if I have an algorithm that completely that that that stacked me up in the o in the in the uh ladder where I could get Q priority, If I have an algorithm that could cancel my bid or offer in a nanosecond like everyone else has, maybe I could go back to making markets like that again. But I am not fast enough with a mouse to cancel bids and offers without getting steamrolled.

And that's the problem I have. So now I'm a risk taker. I'm not assuming risk anymore. Which I'm not completely happy about. But And it's a challenge for me. So there you go, mate. So by being a risk taker you're essentially saying that your edge you have less of an edge nowadays. There is no edge. The only edge I have is is my ability to listen to what the market's telling me, my experience. And um and I go from there.

I mean, you know, you look at the y you look at a bill month and it'll be like ninety five bid for five thousand, two hundred offered ninety six. On fifty lots of the two hundred and ninety-six, I'll get these. There's five thousand on the bid. No, there's not. There's really only three hundred. All those other bids in there have been put in by an algorithm and in a flash of a second, because the eyeball only works one twenty-seventh of a second, this is milliseconds.

It not only is bid is gone, there's now five thousand on the offer at ninety five because everyone's piling over the back of each other with their algorithm to get on the offer. You know, so I have to start hitting bids and offers that I reckon are are value for me and it's the trade I want. And in the old days, I could just sit there and someone eventually buy the ninety sixes off me. Do you understand what I'm saying? Do you do how many algo trainers here? Hold your hand up.

One, two, three only three? Ok, come on, guys. How many AWA traders really here? Okay. So there's not that many members of the evil empire, is there? Okay. Well that's kinda cool. I thought there'd be a lot more algo algo traders here.

Can I what kind of algo do you have? Can you tell me about your algo? No. See how tight-lip they are about it? Um Yeah, hey tight. Talk about relative value and the the trade and what I'm interested in is um the entry on one of your legs uh might be aggressive now. What about the other leg? So you're trading uh spy S and P. Are you willing to be passive with the algos on the chance that you're gonna get set or have your cost kind of double because you've got to cross both space.

Um well, good question. Um It's all about feel for me. And number one, I don't worry about commissions. And that's another thing you guys should do. Fight for every dollar with whoever you're trading through for every commission dollar. So nail them down. Your biggest cost of trading is paying commissions, mate. And just just screw them down as far as you can in the commissions you're paying. It'll pay off in the long run.

So I don't the I don't pay I don't care about paying extra commissions because I'd pretty much screwed it down to next to nothing anyway. But um market cost. Sorry, the you mean the market cost. Ah, market cost. Um I don't perceive it as market cost. I just perceive it as is am I gonna get it the price I wanted at? No, I'll have to pay up a half tick. That's okay. It doesn't it doesn't bother me to do that.

Um if I want the trade, I want the trade. Sometimes it works, sometimes it doesn't. Um especially if I'm trading, say like the you know, the the spy against the S P or the the tenure notes in the States against our tenure bonds. Um which I don't do a whole lot of is very dangerous. And that's another thing, guys. If you guys are all young, go for it, man. Just fucking go for it.

I'm I'm at a stage in my life where I'll tell you what, if I did something really stupid in the market and I gave it all back, I'm gonna feel like a really fucking idiot. I'm I don't wanna do that. I don't wanna give it all back. I got a good lifestyle. You know I I don't

You know, you work really hard at something, you get good at it, you do you you're so one of your one of your concerns is that you're all of a sudden just gonna give it back for one stupid trade. Um the my risk taking taking days of being an over trader and trading huge size are over with. I don't need it, I don't want it. Any amounts of money that I make now are not gonna affect my lifestyle. Making more money does not change my lifestyle. So

When you're young you wanna make money to enhance your lifestyle and hopefully for some other good reasons. Why do you want to make money? Family. Family. That's good. Very noble. What do you want to make money? It's a very complex question, I think, to make my life uh more rich. More rich?

Not only in a financial or material things. Yes. So yeah. That's yeah, i it it's it's a good question. I think we should all be asking that of ourselves. What what what are we what are we what are we chasing the money for? And it and it is a very uh funny game because our only measure of success is how much money you're making. You know, at least LeBron James has a trophy to hold up and he scored fifty-two points in a game. He you know, he he he um he has he has more of a

Uh acknowledged greatness. But if you're sitting at home, by the way, who trades from home? Hold your hand up, please. Whoa, a lot of you. Cool. That's good. Any of you trade from your mother's basement? Just kidding. Um Is it lonely trading at home? Because would you prefer to be trading with someone else? Just out of curiosity?

You prefer to trade by yourself? Do you prefer to trade by yourself? Uh uh probably'cause I can concentrate, so I've never tried I never traded I don't know any traders at all, so actually I've one in the US but I don't talk to anyone so yeah, i i it's a very insular game if you don't have anyone in your room trading with you and it it's gonna and it and it's tough because if you've had a good day or a good week, how do you you kind of want you kind of want some acknowledgement of that.

And you don't really have that. You're not gonna get acknowledgement of that. Yeah. Well you g yeah, that's right. You can treat yourself by spending some money, which is always a a good idea to do that. Um but The one thing that I found and and about trading and it's the greatest gift that trading ever gave me and has nothing to do with money.

It has to do with freedom up here. I knew early in my life I wasn't the type of person who who was gonna be told what to do. I realized I was gonna have to find something that I could do for myself. I wasn't very good at taking orders or working for somebody. And initially it was like okay do to to do that I need to make some money on my own. I'll become a trader. Okay? Down the track

And I made mistakes. I started you know, when I first got some money I started buying stupid things, buying stupid things. Then I realized that owning physical possessions was just gonna be a burden to someone like myself. I'm no good. I can't look after things. I don't know how to change the oil. I can't do this, I can't do that. Owning physical possessions is a complete burden. So I stopped doing that.

And then a little bit further down the track, I realized that the greatest thing that trading was going to do for me was freeing up my mind. Free me up up here. I can look at any situation in my life and treat it honestly and fairly without having to accept anybody else's dogma being shoved down my throat. And I like that. I love having freedom up here. It's a really beautiful feeling and I wouldn't trade it for the world. And that's that's what money's done for me.

It's enhanced my um my existence on a lot of different levels and has nothing to do with fast cars, fast women or any of the other nonsense. Okay. So I just thought I'd pass that one on to you.

Yeah, go for it. Right y up. So we I've asked the algorithm question. Um how many people here trade their own account. Hold their hands up, please. Just their own money or their family money. They don't trade for anybody else. Wow. Cool. That's mo that's most of you. That's good. That's good. You know, I've noticed I've noticed with traders that some are really good at just trading their own money.

And they can't trade for anyone else. And there's other people the exact opposite. As a matter of fact, m a lot of people, they trade for a bank, they're there for ten years, they make keeps money trading, they go, I'm so I'm gonna go do this on my own and they fail. Ninety percent of the time they fail. As soon as they start punting their own money. When you're punting your own money, it changes the psychology of trading completely.

Uh but it's good it's good psychology when you're trading your money. You're gonna learn faster, um, you're gonna learn you're gonna learn more, and you're gonna be more focused on what you're doing. Really important, focused on what you're doing. So I'm a big believer in trading your own money. If you want to trade someone else's money, just be really careful, especially family money and

grandma's pension. Just try to just try to trade your own money and go from there. And grow organically. You know, if you start with ten thousand dollars an account, that don't th there's nothing wrong with that. It gets up to 15, pull a couple thousand out, build, build, build, grow organically, and don't try to make it happen too fast. You got to stay on the test of time. If you really want to trade for a longer period of time, you can't go ballistic.

Too early. Um and what I mean is I knew a lot of traders that would trade for nine months and they'd make money every week. Every week. Good money. Money, money, money, money, money coming in. And then in three days, after nine months, they give it all back. They give it all back. And I thought about this over the years, because I've seen this more than once. And I said to my I've said to myself, well, why does this happen?

There seems to be a self-kill in a lot of traders. And I can only put it down to the fact that I think one of the One of the things that happens to us as human beings is we really enjoy the challenge of trading and the climb up the hill. And that's where the thrill is. The thrill is climbing up the hill. And if all of a sudden you think you've reached the top of the hill because you've made a bit of money, a bunch of money.

You don't like that. Your subconscious mind takes over and goes, I don't like this. Let's climb the hill again and you lose everything. In just two or three days, all gone. Now I'm back where I want to be. I'm back down here, and now I'm gonna have fun climbing the hill again. So be careful. Be careful. Don't be one of those people. It's no good. Not good. No, no, no. Okay? So but to be aware, it's out there. If you let it crawl into you it can happen.

You gotta really know yourself really well. Talk to yourself. Have a chat. Get to know yourself really well. It's very important. Okay, well I know we're getting on a little bit, so let's uh dedicate a little bit of time to some QA. I'm sure there's a few of you who do have questions. Knock yourself out. You can ask me anything. Please.

If you have that flaw in your subconscious mind, how would you uh stop it or you know? I'm sorry, could you repeat the question? If you've got that flaw of climbing the heel in your subconscious mind, ah, ah. Yeah, how how do you stop that from happening? You know, I I really don't know'cause it's never happened to me. I never had the self kill.

I'd lose money, but I never never beat my and that's another thing. Another thing guys, this is real important too. Don't beat yourself up when you lose money. You're gonna lose money. This is one of the keys to losing money. Uh I had a bunch of traders a few years ago that were the and they were beating themselves up because they'd missed a trade or they had a or they had a minor loss. And I'm like, don't beat yourself up. It's gonna happen. Just get on with things. Especially missing a trade.

Right, Aaron? Were you out there? I missed those fifty ones the other day in the curve. Now two hours later the curve's at fifty three. I miss those fifty ones. And I'm just like, mate, let it go. Let it go. It'll always be another opportunity. So don't beat yourself up. As far as the self-kill though goes thing, I I I don't know. Uh uh, you know, I've I've always just let my subconscious mind do whatever it wanted.

But I know my subconscious mind doesn't doesn't want to kill me. Thanks. Are there any other questions? Ramo, um you say you're more of a price tanker now, and um you were talking about how the bills and threes they were a little bit ballistic back then. And uh just last week, you know, the whites went a bit crazy compared to the reds.

And you know, the Eurodollars are up and the whites are kind of flat on the floor, the reds are on fire. Kind of what are you looking at right now in the real market? I love you. That's great. Um well The market's telling me that that there's been a lot of issues with the first one or two bill months with the LIBOR rate out of the United States. A lot of you guys aren't gonna know what I'm talking about here, but he will. Sorry.

Um so the LIBOR rate out of the States has been has been created creating great v incredible volatility in the first two bill months. So volatility that I've never seen before. It's it's insane. Normally the June bills which which you know will go go off the board on Thursday. Uh they would normally for the month of May have a three point range.

In May they were up twenty, down twenty, up ten, down ten. It's insane. And it all has to do with the borrowing rates that our banks have to pay to the banks in the United States for short term cash. United States rates are going up. There's the United States wants more uh bang they they for their buck.

uh and this country the banks in this country are having to pay more short term interest on this country. And it it's really f in this country so it's it's really quite interesting because the RBA cash rate, which is just sitting at one and a half percent. I don't know if the RBA really wants this, but that cash rate that they have at one and a half percent is gonna become redundant quite quickly.

No one's gonna pay attention to anymore. It doesn't mean shit. You know what mean you know what really important to banks is how much they have to pay for their short term cash. That's the real interest rate in this country, not the RBA cash rate. RBA cash rate is It's becoming meaningless very quickly. And I've never seen that before. There, there you go. That's something completely new.

Like a and as far as the structure of the bill market is concerned, I'm just doing what the market tells me. I mean you see these June bills go five under the set bills last night? You know that that's tied to the LIBOR thing. I don't wanna be along the first two bill months.

I wanna be short them. I don't wanna be long out the back.'Cause that's the market the markets telling me that. I want negatives on. Which is which is which is something you wouldn't normally do if you thought they were raising interest rates. Structurally the bill market, the threes and tens act as come I'll get specific with you guys here. I'll get real specific with you.

Spa normally the the structure of our bill market and our yield curve acts a certain way, whether it's in a bull market, a bear market, or an in between market. Right now we're in in between market and what they normally do is they say, Well we know interest rates are going up but we don't know when so they'll be it up on the ten year bonds.

We don't know. So we'll sell long-dated stuff because there's no sense in selling three months out, six months out, because it might not work. It might just sit here and not move. So they they they have a tendency to steepen things up in anticipation of rates going up, right? Then when they start actually raising rates it flip flops and goes the other way.

The three year bonds are a funny one. The three year bonds in a normal bull market are the strongest thing on the board and the bear market, they're the str the weakest thing on the board. But they always predict what's gonna happen before it happens. If you watch the three year bond contract and its price relationship with the second bill month in the ten years, okay? I trade something here's a good one for you guys. You guys did trade this shit. I made the term up.

What it basically b basically what it is, it's it's a spread relationship that moves in tandem with the market going up and down. So if the market makes new high, the spread's doing a certain thing. I I'll give you a perfect example.

The the curve, the three years versus the ten years. We had a really nice rally on the back of this Italian situation, and the curve was coming in as the market rallied. The ten years are stronger than the three years. They should be, they're more volatile. The spread's coming in, the spread's coming in, the spreads coming in. And what I'm waiting for

I'm waiting for the market and you know when it backs off and then it makes new highs and it backs off and it makes new highs. I'm waiting for the m then the spreads coming in. Every time the market makes new highs, the spread's lower, the price of the spread's lower. I'm waiting for the market to make a new high, but the spread doesn't make a new low. That is price divergence relative to the spread. And that's telling you it's time to buy the bloody curve.

Because the strength isn't in the ten years anymore. They're giving up on the ten years. The trend has always been for the that spread to make new lows as the market makes new highs. Now the markets are making new highs. This happened last week when the three years got back up to forty. Their old high was forty and a half. Ten years old high was um Aaron, where are you? I think the tenure the tenure high was like forty one and they could only get up to thirty-eight.

So the curve before when it was making new highs was in at fifty, went fifty sellers. This time the market's back up near as all the highs, but the curve's fifty-one bid. Now. What's the beauty of that is that if you put that spread on, you're gonna make money whether the market goes up or down.

And that's what I look for. I want to put spread relationships on that are gonna work regardless of whether the market goes up or down. And these are what the situations I look for. I'm not good at telling whether the market's going up or down. I wouldn't have a clue. That's not my job. My job is to do what the market tells me. That's what I do. I don't second guess the market.

I look for these price relationships to diverge relative to the overall price of the market. I'm watching them very carefully. I'm trading them every day. I'm really focused on them and watching'em. And and I do all the little things that I do. And then when I see the opportunity, I'll jump in.

So can I ask about the um little things that you do, so good and good habits? For example, for example that you Well I I d uh d y you know what? That's a really good question. I'm glad you asked me that. It's funny how the brain likes to categorize and organize everything, but it also wants a change.

If you get into a routine, your brain will accept it initially, but then eventually after a period of time, it's going to get pissed off. So what I do, if I have a regular way I drive to and from work, I'll change that route. Twice a week, I'll go a completely different way. I just change things up. Instead of just doing the same thing, I'll change it all the time. My brain likes that.

So it's it's really quite strange because because the brain likes to is it's like you know, we build computers. It's just a it's just a mirror of the brain. And computers can can d disseminate information much faster than our brains can now. And the brain loves defile and categorize things because it's easier to deal with things like that. You know, meek a meet a bloke at a cocktail party, his name's Bob, he's got three kids.

He's an accountant. That's what he does for a living. And you see him f and you could and you go and you put that in your brain because you've now categorized Bob. Bob's categorized. It's in your brain. Your brain wants it. You your psyche likes that. Okay? You see Bob a couple of years later and you go, How are the kids? He goes, they're gone. I got divorced. He goes, Are you still an accountant? No, I'm a bum. You know, you just and now you have to recategorize in your brain.

These different situations. Try not it's very difficult, but try not to to uh categorize things too much in your brain. Keep it keep it really open on all levels and ch and change and change things up. Change the way you talk, change the way you do things. I I remember in un this is gonna sound like I'm bragging, but believe me or not. When I was in university, I got so bored at going to lectures that I learned uh from Da Vinci used to write things in mirror script.

And the only way you could read his notes, he did this to disguise it, but it really didn't work, cause once you learn how to read it, you can see it anyway. The only way you could read his notes was by holding it up to a mirror and looking at the mirror and reading it that way. So I started taking notes in mirror script. Because that it was a challenge for me. It was a challenge for my brain. And I wanted to do that. I'm challenging my brain all the time.

I got a really good question. When someone asks you, what do you do? What do you say? It's really important how you answer that question. What do you do? I've had a lot of different answers to that question over the last forty years of my life. I have to size the person up. If I say, Well, I trade ninety day bank bill spreads at the Sydney Future Exchange, believe me huh? So I I don't always say that. I have to size the person up and then decide what I want to say. Um ten years ago

If you ask me what do you do, I'd say, I'm in the business of losing. Look at me and go, What? Yes, it's very important that I lose. Losing's very important to me. And they go, they think I'm out of my mind, and they usually walk away. Nowadays, if you ask me, what do you do? I have to think about what I'm doing on a daily basis. And the answer to that question is what do I do? On a daily basis, I'm trying to solve problems.

I love being a problem solver. I love being challenged by mathematical equations, Euclidean geometry, sudoku puzzles, um everything. I love expanding my brain. I want to learn and learn and learn. And by the way, I'm still learning how to try it. If you think I got all the answers, I don't. Ask me in five years. I'll have more answers for you because I'm still learning how to try it.

It's hard. It's not easy. But it's fun. That's why I keep doing it. Because it's a fun challenge. It's a very much a challenge for me up here. But I enjoy the challenge. Ving firar 70 år av resor som är svåra att släppa taget om. Och det gör vi med massor av erbjudanden som är omöjliga att motstå. Boka redan nu på wing.se, de bästa resorna försvinner först. Anyway. You know, and I live on a farm now with, you know, eighty nine steers and

ninety acres to look after and I'm doing shit that I never before did in my life. I have to go out in the barn and there's a hinge broken up there, I gotta figure out how to fix that hinge. Then other cows are pissed off over here and I gotta solve I'm solving problems. I'm solving problems continuously. Then I turn the computer screen on. There's another problem. I gotta figure out what the market's gonna do next, another problem. But I revel in trying to solve problems. I love it.

I wouldn't have it any other way. Does that answer your question, Connor? Yes. Okay, cool.

Alright, are there any other questions? Managing Russia's unreal. I'm just wondering. Someone like you, do you need a risk hit to get your adrenaline going. You need to take a a big punt now now to have a have a go and feel like the blood's boiling again. No, no, I I don't. I I don't you know, I I go I go skiing on really steep mountains. That's a pretty good adrenaline rush.

Um I got a sixteen year old daughter, she's in adrenaline rush. I've got I've got you know I got seven children. I mean I've got uh I got a l I got a lot of things happening. I d do I need an adrenaline rush from trading like I used to get. Actually I had a little bit of adrenaline rush in here. I was

kinda toey and nervous when this first started up was the non farm payrolls out in about ten seconds. It's it's how I get just before non farm payrolls. I'm like, ooh, like this. So I I get fired up, but uh do I purposely fire myself up by putting on big trades? No. No, I don't I don't do that. Ha ha ha. Hi. Um I'm a soccer player that studied finance and um not

naturally I gravitated towards uh analysing sports data. Uh I guess one of my favorite um podcasts was the one you had with Brandon Butts, uh who uh is is a sports trader, has like the first uh Sports edge fund. Um I have a bit of a non conventional view which is uh sports trading to me is essentially uh trading as well.

And um I'm often met with a question that that is gambling. Which often baffles me, you know,'cause uh sometimes you need to really explain that you just have to look at it this way. It's not really where you trade, it's why you trading. My question to you is where do you draw the line between gambling and trading? And does it matter where you trade or why you trade? Well

To me, gambling is going to a casino or betting on the horses or getting involved in a dice game, you know, in the in an alleyway. That that's that's gambling. Uh trading, because I like to think that I'm good at it.

There's not the same perceived risk for me. Uh to me, trading is something that I think I'm gonna win at a lot easier than walking to a casino and playing blackjack. But I'm not a casino I'm staying at the casino but I I won't go to any of the any of the rooms. Doesn't doesn't hold any appeal to me.

Um, and that's another thing. If you once you start trading and you really fall in love with trading, all other forms of gambling are gonna pale by comparison. You're not gonna be interested in that shit. It always amazed me. I knew some traders in Sydney, I I I still know them and they They it didn't matter whether they were trading uh futures hundreds of thousands of dollars back and forth each day, they go to the track and do the same thing. They have a hundred thousand dollars.

out of Ramwick on the weekend. They go to a casino and they and they and they they ooh you the high roll and they give they give them a bunch of chips and they and and and they didn't they didn't make a distinction between trading futures or shares or something that they're kinda getting paid to do because a lot of these guys work at banks. They they didn't make a distinguish between that and all other forms of gambling.

It's semantics and it's psychological. Is it is listen, uh futures training is glorified gambling. It is. It's glorified gambling. Um but I guess it's the way you think about it in your head, you know. I had two hundred and fifty dollars in the Sacramento Kings to um To win the NBA. Hopefully they'll they beat LeBron. But he's the king. Sorry, I'm watching basketball right now, the NBA. It's crazy stuff.

Crazy stuff. Oh, I do have some little little stuff and just bear with me right here. I was watching the golf over the weekend. And they were at the memorial tournament in Ohio and Jack Nicholas was there giving a little speech. And I wrote down what he said and he was because I think golf is very similar to trading. So one sport

that has a draws a lot of parallels to trading. And he said the following. He was talking about Hale Irwin, who was another golfer of his era, who was just receiving a big prize. And he referred he said Hail Erwin is a great manager of himself. and the course. The analogy here is that a golf course is like the market. When you tee off on the first tee, what are you up against? Well you're up against how are you gonna swing the club? What did what what are you thinking in your head?

How am I gonna play today? It's very internal. The course. How's the wind blowing? How fast are the greens? How thick is the rough? That's the marketplace. You can't you that's what you have to deal with.

When a professional golfer tee is off, he has to deal not only with himself but the golf course. Every time you turn that machine on, you have to deal with yourself and you have to deal with the market. Very close parallels. Anyway, he said Hail Erwin's a great manager of himself and the course. And then he just said this to anybody who wanted to hear it. He said, know who you are, know your game, play within yourself. I wrote it down'cause I said fuck this is just this this is trading.

This is trading. You know what I mean? And he said, believe in yourself. And I've already said that to you guys. Believe in yourself. And he another thing he said that I thought was very fascinating. He's you know, he's talking on the TV. He said and he's the greatest golfer ever. You know, he's one he's dominated the sport during his era. And he said, I never thought I was the best. I never thought I was the best. He said if I ever started thinking that way, I was

Absolutely destined to screw up. Take a triple bogey, lose the tournament, not make the cut. So I never thought about being the best. To me it was always the challenge to try to be the best. I thought that was interesting. I thought I'd pass that on to you guys. There you go. Is there anything else in that notebook which we should um dig into? We've probably got about ten minutes left.

The markets have grown. I had the exchange send me the open interest for the first six bill months. In nineteen ninety eight it was three hundred and fifty six thousand on the first of June of nineteen ninety eight, first six bill months open interest. Ten years later, June second, two thousand eight, nine hundred and seventy-three thousand. It's almost tripled. I was gonna get the numbers for last week, I didn't get'em, but I guarantee you it's gone up again.

My volume grew organically because the market volume increased. I didn't force it upon myself to trade larger. As the market volume grew, my volume grew. Okay? I didn't just decide one day I'm gonna double my volume. My volume went up because the marketplace allowed my volume to go up. It wasn't predetermined. It just happened that way. Because I'm riding on the coattails.

industry that has grown a shitload in the last forty years. There you go. Would you say it was a a factor of that combined with your your risk appetite? Like I'm always interested by these really big traders who can and can throw it around a little bit. I feel as though A large or maybe not a large but a great um factor of their success is their appetite to save. I'm completely unfocused on risk.

The risk to me doesn't exist. I don't put a trade on and think, well, what are the margins in this going to be? What's my risk? Where am I going to get out? I've never used a stop in my life. I've traded millions and millions of contracts over the last 40 years. I've never, ever used a stop. There you go. Pretty wild shit, eh? But you're managing your risk in other ways, aren't you? Like you adjust your spread or uh Yeah, yeah. And I you know, yeah. And you know, and you lose.

And you win. You become a listen, you become immune you become immune to winning and losing. Winning and losing don't matter anymore. Risk doesn't matter anymore. I'm telling you. I'm repeating myself here. But you just focused on the next trade all the time.

And the chips will fall how the chips fall. I told you, I s one time I spent nine months, I never looked at a statement. I didn't care about the money. Who cares? The money the money's gonna do whatever the money wants to do. I can't change that. I just wanna make good treads. I just want to focus on the now of trading.

I know that's hard to do when you're starting up. I'm I'm completely aware of that. What I'm talking about is stuff that you have to evolve into over a period of time. You just can't say I'm I'm trading now and I'm gonna do what what Rambo says. You can't you can't do that. It's something you have to evolve into, believe me. And and it's and it's something that is hard to do if you're not inclined to be that way. I was just inclined to be that way.

Do you have good options? No. So you spread it? I'm spreading within the uh ninety eight percent of the time I'm spreading within The uh interest rate structure of stale, the yield curve. Um let's just do one more question over that way. I love that question. Do you know how many times I've been asked that question? Lifestyle. To put it in a nutshell. Lifestyle.

You know, like if I wanted if I wanna be uh uh really, really, really rich, I had to stay in either Chicago, New York or London and I discovered Australia and I fell in love with this people, the open spaces.

And every I'll give you I'll give you um a funny little example. This there's many girls here, there's a few girls here. Hi. In America when I was trading in America at the Chicago Board of Trade and the the girls in Chicago knew If you were a trader at the Chicago border trade, believe me, they knew.

But nonetheless, about the second or third question a girl in Chicago would ask you when you're out and you're twenty five years old, roaming around the city, is so what do you do? What do you do? Now that's a really polite way of saying How much money do I? In those days I was a bartender. So I would say

I'm a bartender and just see the reaction in the face, how long they'd stay and want to talk with me if I said bartender. But I knew if I said I'm a trader of the Chicago Board of Trade, the next question is, oh, do you own your own seat? They were smart, they knew. In Chicago, the trading mentality is so huge, everybody knows about the markets. The Merck, the Board of Trade, everybody.

There's not a single person doesn't know about these institutions. When I came to Australia At same age, I'd go into a pub somewhere and I'd meet a beautiful Australian young lady. And she would look at me and she'd ask me almost the exact same question, but with completely different meaning. She said, So, you're from Chicago? Yes. So what are you doing? What are you doing? Do you want to go to the beach with me tomorrow? We're having a barbecue tomorrow afternoon?

What are you doing while you're here? Let's have some fun together. Do you want to come back to my place? What are you doing? Not what do you do? So I f I just found it very refreshing that the Australians in general, and in particular the women, were not focused. On the money element things. You know?

That's one of the the problems I think they have in the States to be honest with you, is I think a lot of people are way too focused on money. But I came here for lifestyle night. I fell in love with with the the beaches and and the the the girls and the and the And the beer, it was far superior beer. Now with craft beer, the states have made a huge comeback. But in those days, beer in America sucked. You know, Budweiser, Bud Light, you gotta be kidding me.

Come here and have a rushes at this Dane Hotel in Manley, that's a real beer.

Yeah, it's available on YouTube. Yeah. Well you need to give me a specific question involving that. That was why did they do it on you? Well they didn't do it on me. Yeah, I'll be able to do that. And they followed me around with the cameras for a while and we became really good friends. I became really good friends with the cameraman, the producer, the director of that series. It wasn't a series, a documentary. And I said to them when they were doing this, I said, Hey guys, listen.

I don't want you misrepresenting me and I want full abilities when you make this thing to let me have a look at it and I can axe anything out of this that I want. They said, no worries, John, we'll do that. So they had the final product. I looked at it, I looked at it, I said, you know what?

I use the F word an awful lot in this and I normally don't use the F word in my real life that much. You heard me use it tonight a couple times, but I you know the it may be sound like but they were doing that to to to drama to make it more watchable. 'Cause people, you know, they want to watch something that has a bit of excitement to it.

So they gave me full editing rights and I looked at it and I said, Ah, all right. Yeah. So if there's anything in there that makes me look bad I I can only blame myself. But I'm not too thussed what people think about me, in case you didn't know. All right, let's uh let's leave it there. John is gonna head over to the bar with us afterwards so you'll be able to catch him there and um have a chat over a bear or whatever you drink. Yeah, I gotta say John, absolute honour. Pleasure mate. Thank you.

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