Interview with trader Bennett Makdauellom

Jeff Neil, Optionetics.com
2/6/2004 10:15:00 AM

Founder and President of "Traders Coach.com" Bennett Makdauell began his financial career on Wall Street firm in the "JJ Kenny Co." in 1984. after the service officer at the U.S. Navy. Bennett also served as a specialist in pensions to "Equitable" in New York and also has experience in real estate investments. In addition, his degree of Bachelor of Economics, received in 1979. Siracusa in the university gives him the foundation for work in the financial sector.

Jeff: Do you prefer short or dolgovremen-ing trade? And why?

Bennett: I enjoy all types of trading all time formats and actually prefer to diversify my time frame as far as trade market, which I traded. I traded in the day, from days to weeks, as well as on the weekly charts. Typically, this is a good idea for positional traders (the position of a few days to several weeks) does not monitor its position throughout the day, but instead to take their trading decisions every night. In this case, position traders are not subject to intra-day activity and the negative emotions that are associated with this. However, it is that I traded in a 30-minute intra-day charts with the intent to hold the position until the next day.

Jeff: What you are most attracted to trade?

Bennett: The freedom to choose the markets in which I want to sell, and compensation for risk, which makes the trade to the highest level of capitalism. In addition, this dream of an entrepreneur - I could live anywhere, where I have access to the Internet! Trade offers unlimited potential income. There are no difficult bosses, which must be fought, no office and no policy of discrimination in trade in the market. Also, I like to sell and enjoy the process of continuous improvement. Trade - my passion, and I am enjoying the process as fast as I enjoy the reward.

Jeff: How do you treat losses and recession?

Bennett: All systems and methods of trade are periods of recession. You never know when there is recession, so you should be prepared always. You should be able to trade during these difficult periods that will actually occur in the trade. If you stay within 2% of the first risk at each transaction, you will have a greater chance to escape the devastation. But if the loss is 2% five or six times by a number of scares you, then you should reduce your risk even more (less than 2%), yet you can not emotionally feel good.

Jeff: What are the key rules you consider most important for a trader?

Bennett: I think the most important rule before entering the trade is to calculate the correct "trade size" based on the amount of accounts, the entrance to the trade, output, and the percentage of risk, which really should never exceed 2%.

Jeff: Tell us about your most memorable transaction.

Bennett: I have had many unforgettable deals, and good and bad. But most of all I learned from the following transactions: When I was a newcomer and did not know very much about commerce and control of risk, I bought the stake, as my analysis showed at the beginning of bovine market. My analysis was wrong and the action started with the largest decline for many years, and I held my shares! A week later, I realized that I have a problem, then I dropped about $ 15,000. I could not believe this, but I continued to say that the market may not always fall! But it fell even lower! And then I felt like a deer caught in car headlamps, I "stopped" and did not know what to do. At this point my emotions identified by trade. I have lost all objectivity, and ultimately went with the loss of only $ 30,000 in two weeks! And, of course, I actually went to the turn! There were a lot of money for me at the time, and this is also me emotionally traumatic for a while. However, this trade has taught me the best lesson I will never let this happen again! I learned the importance of risk management!

Jeff: With all the existing different technical analysis tools, as a beginner can avoid information overload or "analysis paralysis"?

Bennett: That is a good question! Is interesting to note that with all the new technologies available today, the ratio of winning traders and play is almost the same as twenty and thirty years ago. Why? As a successful trade is from the inside and as we all sell our own beliefs, we all interpret information from different points of view and therefore respond to this information in different ways. In trade, it has profound significance, because it all comes down to how we interpret information and what we are to interpret. This is why I develop and use "Applied Trade validity" to trade in markets. Our approach eliminates the additional information that may confuse traders.

Jeff: What are the tools of technical and fundamental analysis are you using?

Bennett: I'm using your own trading approach that I developed called "Applied commercial reality," using our indicator of the validity of "Pyramid of the outlets." "Pyramid outlets" transforms the concept of trading "control points" and "fractals" in the next generation. And the amount and basis of "Pyramid outlets" are of great importance. Although all inputs and outputs are based on technical analysis, I do from time to time, using the fundamental information to confirm the technical picture. I also believe that the price and volume of the "truth" and that most market indicators distort market realities, because they are derivatives of price and volume.

Jeff: How would you describe your approach would be to trade?

Bennett: My approach to trade based on our own signals with our own individuality, so everyone can develop their own trading system. When you can make your personality to your trading approach, this could become a powerful force in the market. Stop relying on commercial systems such as "black boxes" which you do not trust. We found that when traders are unfavorable periods in the systems that they have not developed for themselves, they usually leave the system and move to another.

I am convinced that no one is born a great trader, and that any of passion, commitment, proper education and venture capital has the potential to become a great trader. Trade - not the philosophy of rapid enrichment, a profession with which you need to cope, to make a profit. Through education, practice and commitment, you can potentially acquire the skills to trade the financial markets to survive. Trade must be happy, and if not, then you're doing it wrong!

I believe that the professional is not excitedly trading game, but some players use the markets to trade and to meet their exciting and destructive habit. A door that separates the trade of game is called risk management. Professional traders have a strict money management rules, which they follow, the approaches to trade, they have tested and included in the sale of a business. Their satisfaction is based on a good trade, but not on the sensations that are experienced players in the trade. Professional traders actively traded no more than 10% of their own capital and that the money they can afford to risk.

I am convinced that most traders incorrectly sees markets in terms of a simple "linear" approach, and instead should implement the "linear" approach to the markets because the markets themselves, "nonlinear".

Jeff: Do you think what the biggest misconception that people have on trade and investment?

Bennett: Most new traders believed that trading is easy and the only thing that is needed for this - this is money. In other words, money is a ticket for access to earning big money. They fail to understand that successful trading - is the ability to develop hard work, persistence, time and training. Most traders consider trading as a program of "quick riches".

Another misconception that people have had the fact that intra-day trade is just silly and excitable game. Stupid deal, not knowing what you are doing, and professional "inside day" traders are not players and are not stupid. On the contrary - they are highly skilled and talented professionals.

Stanislav Skrypnik
based on Yahoo.com