Methods of Wall Street Master // Metodos de un Maestro de Wall Street

Trought a recommendation I heard about Victor Sperandeo and his Best Seller "Methods of Wall Street Master", Both are really interesting, him as trader and his book as guide to become a good trader and to understand the markets.

I´m going to introduce you Victor Sperandeo:

Victor Sperandeo, succesfull trader.

Known as “Trader Vic”, he is a professional trader, index developer, and financial market commentator based in Dallas, Texas, with over 40 years experience trading numerous markets. He has traded independently, and for many notable investors such as George Soros, Leon Cooperman and BT Alex Brown.

Mr. Sperandeo is widely regarded as an expert in commodities, particularly in the Energy and Metals sectors. His market crash prediction during a September 1987 Barron’s interview earned him great recognition and highlighted his deep understanding of financial markets. In recent years, Mr. Sperandeo is best known for developing indexes and trading strategies that are designed to benefit from futures price trends. These include both actively managed strategies as well as rules-based algorithmic quantitative models. He has received three patents in the U.S., two in the Bahamas, and one in Australia on financial products using long/short algorithmic indicators or indices in conjunction with leverage, which add alpha while simultaneously reducing risk.

He created the Diversified Trends Indicator™, which is an evolution of these strategies. It is a rules-based, investable trading methodology incorporating a diversified group of highly liquid, exchange-traded commodity and financial futures contracts, reflecting market expectations of near-term and future price movements.

He has been featured twice in Barron’s — “Man of all Markets”, on May 2, 1983, and “Trader Vic the Ultimate Wall Street Pro”, on September 21, 1987 — and been quoted in The Wall Street Journal and Stocks & Commodities. Additionally, he has appeared frequently on CNBC, CNN, Fox and other networks. He has also been included on Ziad Adelnour's list of top 100 Wall Streeters.



 I´ve just start reading this book and it´s really usefull and interesting to me, so i want to share with you its introduction, talks about the simplest concept in financial markets but its really important to know it.

"Methods of a Wall Steet Master"

Introduction: The Secret of the Gamboni


The secret of the Gamboni is the secret of how to survive in the financial markets. Understand it... really understand it... and you are on your way to success as a trader, speculator, or investor. So, here it is:


Joe was a card player, a good one. He was so good, in fact, that he had to move from city to city and find games where he wasn´t Known in order play for high stakes. One afternoon in a bar in the suburbs of Chicago he´s shooting the breeze with the bartender and asks, "Say where can I find a good card game around here?"
"What kind of stakes arte you talking about?"
"Big" Joe says "the biggest game you know about"
"Well now, I hear there´s a game out in the farm country. It´s a bit of a drive but these particular farmers play for big money. Let me make a call and see if it´s OK".


So the bartender makes the call, and then gives Joe directions to the game. That evening after a long drive, Joe pulls up to this barn in the middle of nowhere. Tentatively, he walks inside, tiptoeing around the fetid piles on the floor. At the back of the barn, he spots a partially open door with light and smoke pouring through the opening. The familiar rush of anticipation and energy sweeps through him as he enters the room and introduces himself.
Farmers in overalls sit around the table, chewing cigars and puffing their pipes. In a quick glance. Joe estimates the current pot to be about $40.000 so he sits down. "Ate up, -says the farmer holding the deck of cards. And Joe begins to play.
About an hour later Joe is holding his own. He is about evem when he draws three aces and two queens -a full house. With a large pot already on the table he raises $15.000, the next two guys fold, but the leather-faced farmer across the table calls him and raises another $15.000, without so much as batting an eye. Joe, certain that the guy is bluffing, calls the bet and lays down his aceshig full house. The farmer lays down junk: three clubs and two diamonds of mixed numbered cards. Joe, suppressing a smile, starts to rake in the pot.
"Wait just a darn minute," says the farmer, a stern and reprimanding tone in his voice.
"Wattaya mean, wait a minute" says Joe, "you got nothing."
"Take a look at the sign over your right shoulder," smiles the farmer.
Joe looks:


THREE CLUBS AND TWO DIAMONDS CONSTITUTE A GAMBONI, THE TOP WINNING HAND IN THIS ESTABLISHMENT


Joe is really angry but after all, rules are rules, so he continues to play with what is left of his holdings. About an hour later, he draws three clubs and two diamonds... a Gamboni! He bets everything, and on the final round of betting with the same leather faced farmer he has to throw in his solid gold Rolex to make the call. The farmer turns over his cards a queen-high spade flush. Joe turns over his Gamboni and starts to rake in the pot.
"Hold it there, fella," says the farmer, his grin cutting deep lines in his cheeks.
"But I got a Gamboni!" cries an exasperated Joe.
"Sure ´nough, but look at the sign over there" and he points over Joe´s left shoulder.
Joe looks:


ONLY ONE GAMBONI WILL BE PERMITTED PER NIGHT IN THIS ESTABLISHMENT


Joe, broke but thankful for the invention of credit cards, leaves the barn with dung on his shoes, and the leather faced farmer drives his tractor home feeling the weight of a solid gold Rolex on his wrist. 


So the secret of the Gamboni is this: if you want to win, you´ve got to know the rules; and also, you can´t win if you´re not at the table.


I really liked this relate about an obviously concept, cause there are a lot of people like "Joe"  who begin playing without knowing the rules of the game. 


I will continue reading and learning with this great book and then talk about in nexts posts.