Feedback From Last Night's Meeting

[John]

This is just a follow up to the e-mail I sent out. Feel free to give
me your feedback here on the mock trading excercise at last night's
meeting. I already have many ideas on how to improve it. I will post
them here as well as respond to any of yours. With a little bit of
tweaking, this could truly be a great idea. Thanks Mike for the heads
up on this one. It turned out pretty well.

John

[Michael Catolico]

hey John,
i think it was a very unique and fun experience. i think this can become
an immense learning tool for all levels of traders and deserves a repeat
every month. i suspect that new or inexperienced traders found the
experience to be overwhelming and i hope that some of you in that camp
don't feel intimidated and give some feedback on how it can be better
for you.

i will say this much though. last night's mock trading experience was
actually more forgiving then the first mock-trading experiences i had
while learning to be a market maker. in that environment you are
completely on your own. no matter what you've learned or studied, when
you have to make decisions in the face of shouted but half-understood
orders and rapidly changing prices, you're lucky to come out of there
with any sense of self worth left. and oh, mock trading is a trip to
disneyworld compared to actually walking into a real trading pit for the
first time.

John you also said something very important that can't be stressed
enough. every trade begins with zero expectancy. you can win or lose
whether you are long or short. to turn into a positive expectancy
trader, what matters is how you adapt the position to the circumstances
of the market. to me great traders are great improvisers. like a stage
performer that says or does the right thing at the right time or an
athlete that has the reflexes and perspective to change the play at the
last instant, successful traders absorb what the market is saying and
respond assertively. there is a lot of planning and practice that helps
develop the skills necessary to improvise. this mock trading exercise is
among the most useful i've come across.

as far as suggestions, i think it might be helpful to structure the
meeting/mock trading so that a concept or two could be discussed for the
first half hour, similar to previous sessions. this strategy portion of
the meeting doesn't necessarily have to be related to the trading
session but it could be used to develop everyone's play book.

then i'd devote another 45 mins. to an hour to actual trading. i liked
how you broke up the groups into bullish/bearish/neutral camps. but
there could be other variations such as two groups, each taking the
opposite side of the same inital/neutral trade (e.g. an ATM straddle),
or perhaps everyone starts with the same identical position but the
trades evolve so that folks can see how different thinking leads to
different permutations. another variation could be that groups have to
confine themselves to trading in different expiration series to see how
the mindset has to change. yet another alternative might be to have
groups switch positions midway through the session to have to be faced
with a whole new set of circumstances.

i also think a 15 -30 minute "debriefing" might be useful where we have
time to review what each group has done and to compare notes.

kudos to you for all your hard work and dedication.

m

[John]

Mike,

Those were all great ideas. I will try to think of a way to implement
them all. I thought last night was a lot of fun too and I agree with
you, I can see how this can be an excellent learning tool for people of
all skill levels.

One of the things I am going to do is add a little pressure by speeding
up the pace. What we can do is I will stop for 5 minutes every Friday
session. I will go day by day for about 20 to 30 seconds for the
Monday through Friday periods, and if someone wants to execute a trade,
they have to yell stop or something. And from there I will give them a
minute to come up with their trade then move on. This will force guys
to think on their feet better and to communicate more clearly with
their group. As you know, in real life, the market keeps moving and
doesn't stop for us to think about what we want to do.

I also agree, at the end of the night, we will do a review session of
how the different groups did and what they did right and what they did
wrong. Also we can mix it up and use the suggestions you mentioned.
We'll do it differently every month to add a twist and to keep it
exciting.

I agree with you Mike that this has the potential to be something
really great and exciting. I will do my best to continue to improve it
every month.

John

[John]

Would anyone else like to share any ideas on how to improve the mock
trading?

Someone suggested to me to mix the groups up. That we will certainly
do so everyone has a chance to meet other people in the group.

John