You're talking about a subsequent bias to the bullish side because of that experience? Yes. What gave you confidence when you first started trading on the Mid America Exchange with such a small stake? After all, one mistake and you were out of the game. Well, no, the advantage of the Mid America Exchange was that they traded minicontracts. I had a few
mistakes in me, and I made most, but not all of them. I don't know that I had any confidence. I just had what a lot of
people have when they get in this business: a need to try to succeed. I mean, if you were betting on this sort of thing
before the fact, you should have bet that it wouldn't work. There is no doubt about that.
Most traders are not successful in the first year. What were you doing differently? I was doing enough things right that I didn't capsize even with that small capitalization. I was lucky enough to
stagger into having the right positions on before the big corn blight in 1970.
Was that luck or foresight? I think it was more foresight. I had very pale ideas, rales, and attitudes about the market then. But a few that
I learned were right, like go with the trend.
One Friday, the grain markets all closed at their highs for the year. I believed—and I still believe—that you go
with the trend, and the stronger the trend, the better. I remember getting in on the close and just buying a couple of
minicontracts in corn, wheat, and beans. The next Monday morning they all opened up the limit because of the corn
blight news.
Sure that didn't have to happen, and if it didn't, it would have set me back. It might have taken a lot longer
to get to about $2,000, which compared to $400 was a real grubstake. But, it wasn't like I threw a dart and decided
what to do. I did something that should work in the long ran—I went with the trend.
Is this particular pattern— a
very strong close on a Friday—a market characteristic that you find useful as
an indicator of the following week's price action?
Yes, at a minimum, it is important not to have a short position with a loss on Friday if the market closes at a
high, or a long position if it closes at alow.
