Ed SpecI discovered Victor Niederhoffer accidentally when I chanced upon his book Education of a Speculator in Indian Pavements, a seller of used books. I immediately grabbed with both hands at the ask price. Since then it's been a long process of education and self discovery. Even my nine year old daughter Gangineni Hita understands Victor and is fond of his stories, read to her occasionally at nights. As a teacher of finance, the first reading assignment on markets I give to graduate students is "The Old Trader and the Yen" from Ed Spec.

Constantly following Daily Speculations from 2005, I feel part of this soul searching revolution. I have read and re-read discovering new meanings in Ed Spec. The contribution of Victor to financial markets and his winnings outweigh any temporary trading losses.

Gangineni Dhananjhay continues:

I find it puzzling how so many market participants resist exposure to true knowledge. Is public willing to believe half-truths rather than facing facts? So much of what I try to teach from finance text books and theoretical models also goes against intuitive understanding of markets.

As the saying goes ”when the student is ready, teacher appears”. When I try to make analogies of the market as a dancing girl who becomes a witch and other effects of Vig & Spread, students are not ready and want to believe in the text book models of Fundamental & Technical analysis. How many students realise market owes no body anything and it’s a perpetual dance replenishing the market infrastructure itself.

As M!chael L#wis puts it in his article The Evolution of an Investor ”Your [the market intermediaries] job is to turn your clients’ net worth into your own”.  Victor speaks in PracSpec about how market will not allow public to access real knowledge so that they can keep contributing. The law of ever changing cycles always keep the form away from the public. One thing that strikes me is how deep and how hard these legendary speculators swim in the markets . Many can't sustain the draw downs to experience their winnings.

“Speculator” has been defined and given a true interpretation in EdSpec. I devote sufficient time to differentiate between ” Investing, Speculating , Gambling” when I teach or discuss with students & market participants. But the lines get blurred once in thick of action in markets.


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