4 - My First Trade !
Hi, thanks for coming back. Here’s my quick recap.
George makes a Billion, Lisa’s paying the bills, Greg has no job, but has big dreams and is determined to become a Currency Trader.
If any of that doesn't make sense, go back and read from post #1.. I promise it’s worth your while.
After 8 months of continuous study, and countless conversations attempting to explain ‘What the hell I was doing with my life..” I was finally ready.
First order of business.. I told everyone who had previously asked that I had gone back into real estate… That shut them up.
To this day day many of my friends still think I’m in real estate …and that’s just fine with me.
I was now ready to put on my first trade!
Everyone remembers their first ... It’s exciting, it’s scary.. Palms are sweaty..
Could I really do this.. ?
I re-contacted Lind Waldock ... but as it turns out they couldn't open an account in Canada...
I opened an account with Midland Walwyn, a local branch of a commodity brokerage -- scraped together $10k and I was off to the races.
I called my broker, and gave him the instructions…
It was an option trade, and I wanted to be short the Japanese Yen.
As was the convention of the day, and for compliance, he read me back my order and said,” just to be clear you’re betting that the Yen will rise.. Right?”
NO I blurted out, I want to be short!
You want to sell the options he asked?
NO.. Ah,,, Yes … Ah no… OK just cancel the order I yelled and hung up on him..
Full panic had set in, 8 months of working on this, and I couldn’t even place a trade correctly.
My broker called me back, we reviewed the trade again.. And this time we got it right..
I was now the proud owner of 1 JPY PUT OPTION, with a total cost of $1,300 including a $90 commission (ouch!)
As was the plan, the Bank of Japan reduced their interest rates and the Yen tanked.
2 Days later the option was worth a smidge over $4,000 …
I covered for a net profit of approximately $3,000 USD
1 trade, 30% return on the 10K account
That's 300% on the option cost
And only 2 days of work (plus 8 months of learning and several years equivalent of stress )
I was hooked !
$3,000 in 1993 is roughly the same as $5,313 in 2019
* Living in Canada that meant that I also had the value of the USD / CAD exchange rate of approx 1.31
That’s $5.,313 x 1.31 = approx $6,960
Wow not bad for 2 days ‘work’
* sorry to introduce a new currency, the last thing I’d want to do is confuse a potential currency trader with a foreign currency 😉
My first trade was banked… I could now call myself a trader!
Things are going great and they’re only getting better. I’m getting good grades, ...My future so bright I gotta wear shades..(timbuk 3)
See what happened next