On speculation strategy for success in business

As drafted, the dictionary of foreign words [1], a strategy - this is, first, the art of conduct major military operations and war in general, and second - the art of leadership of public and political struggles, and you can certainly add that, in the third - is the art of speculation in the market. On the strategy of warfare LN Tolstoy in the novel «War and Peace» wrote: «Take a fortress is not difficult, it is hard won. And it does not need to assault and attack, and you need patience and time ».

On the war - as in war. This is a French proverb often remember the stock market speculator.

«My God! Give me strength to change what I can change, give me gentleness, to accept the fact that I can not change, and give me the wisdom to distinguish the first from the second! »
Reinhold Nibur

Trader equated to the first merchant guilds
The word «business», we will understand the «any kind of business where people invest their energy, time and personal funds for the implementation of a project and generate income. The project can be anything: from the cultivation of strawberries in the garden plot (for sale) to create a new manufacturing or commercial enterprise »[3]. Speculative transactions as part of any business has several advantages.

First, it is smart business, that is does not require physical exertion.
Secondly, a prestigious business, although for the vast majority of Russian population speculators are still, unfortunately, are «pointsman», which can be «switch» their failures. While the seller is (sometimes unconsciously, but always clear), two important functions:

a) maintain the liquidity of the market, or, in other words, the potential for third-party sellers or buyers, that is just for those on whose opinion is the speculator «fifth wheel in the cart», sell or buy the goods they want without unreasonable loss of time and money;
b) The function of economic barometer, fairly reflects the state of the economy of the state. Resentment at the speculators in this case looks like an insult to the Egyptian Pharaoh Gonta, brought unwelcome news for the Pharaoh, which turns out to Gonta unfortunate consequences. While in Russia, seems to have ceased to apply such an extreme measure, «dry balance» the practice, according to the author for a long time to be subconscious «headache» Russian speculators.

The third advantage speculation - this is an opportunity to obtain a loan (when the game within days - free of charge, and when transferring the open position - with a reasonable pay-per-carry positions, or even with доплатой).

For example, the merchants of the third guild to Czarist Russia could take credit only for physical collateral, the merchants of the second guild - under the bill, and only the first guild merchants receive credit at their word.

Thus, the speculator stock and currency markets, a priori, is equivalent to the first guild of merchants, which imposes on him some responsibility. A natural extension of the merits of the business are its shortcomings, the most important of which are:

- High risk of loss of capital;
- Psychological trauma caused by the fact that the trader, by and large, not to whom «cancel» its failures, except for himself.

Objective and subjective components of success
Business in speculative transactions, like any other, presupposes the existence of competitive advantages, thus earning. Can be split factors component formula for success, the objective and subjective. Their work, in the opinion of the author, and determines the likelihood of success. To the objective factors are the following (in effect given their advantages over other market participants):

1) insider information - Ci;
2) Strategy and tactics of money management - FTC (on the tactics of money management, in particular, see [4]);
3) the experience of the trader - Ko.

By the subjective factor, the author believes, can be attributed intuition - Kean and psychological spirit trader - a CD. Given these factors, the formula for success with the speculative market would be as follows:

U = (Ki + FTC + Co) * (Kin + CD) (1).

With regard to psychological factors of success, in this case, the author takes the extreme right position, believing that a trader with a high mental capacity, not using the most optimal strategy and tactics, and not the latest technology and computer analysis, can be the result of higher trading to traders, oriented only to the «technology» in all its manifestations. This spirit of the trader, the spirit of contributing psychological well-documented Leo Tolstoy in the novel «War and World»:

«Military science, seeing in the history of countless examples of the mass of the troops does not match the power that small detachments defeat larger, vaguely recognizes the existence of this unknown factor, and trying to find him in the geometric construction, the armament, the most ordinary -- in military genius. But the substitution of these values do not factor the results agree with historical facts. In the meantime, it is just turn away from the established, for the sake of the heroes, a false view on the validity of the orders of higher authorities in time of war in order to find this unknown x.

X is the spirit of armies, that is, more or less desire to fight and expose themselves to danger for all people that make up the army, quite irrespective of whether people are fighting under the command of geniuses or not geniuses, three or two lines, clubs or guns, fired thirty times per minute. People who have the greatest desire to fight, always put themselves in condition to fight naivygodneyshie »[2].

Without going into a detailed psychological analysis, in which the author is not a specialist, you can bring one more quote:

«... Our life is - this tour. But the tour is not in the usual historical museum, where all exhibits are in glass showcases, and they can only look and not touch. It is a modern museum, such as museums of technology in the developed Western countries, where visitors can touch and play with almost any exhibit. The challenges there Instruments demonstrate various physical effects - echo, interference, diffraction, magnetism, laser radiation, etc. A visitor can twist any knobs and levers, to press a button and give effect to any exhibit. Thus, purchasing a ticket in a museum, has the right to play with any exhibit any time (within a working day, of course) »[5].