Mar

24

Wiswell ProblemOne of Tom Wiswell's very favorite proverbs was "Take care of the draws, and the wins will take care of themselves." Tom was undefeated world checker champion for 25 years before retiring undefeated.

Russ Sears adds:

You don't beat the best at the beginning, you beat them at the end. You've got to have a kick at the end. The runner capable of relaxing the most will be capable of accelerating the most. The art is knowing which type of kick will make your opposition crumble, the long hard kick or the short burst to the finish line. In other words, know when to apply leverage, and don't overapply leverage or you will be left behind when the real opportunity presents itself. The art is knowing when the real opportunities present themselves, but it's most likely when everybody else is tightening up and panicking.


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9 Comments so far

  1. steve leslie on March 24, 2008 10:05 am

    Alberto Salazar was the biggest name in U.S. marathon running winning three consecutive New York Marathons from 1980-1982. He was on the U.S. team that boycotted the Olympics in 1980 and he won the Boston Marathon in 1982. I remember in one of his NY runs he had a competitor on his shoulder, when at the 21 0r 22 mile mark he turned in a 4:30 mile completely breaking the spirit of his opponent and cruised through Central Park to break the tape.

    Lance Armstrong winner of 7 consecutive Tour de France events, would break his opponents in the mountains. He knew that he had the best team, he was the best at the time trial, so he could concentrate on staying with his main competitors until the mountain stages and it was there that he would put together a few bursts of herculean effort that would just break the spirit of his opponent. Once he had the lead over them, he would not let up and once he broke contact from them he could essentially dictate the pace through the duration of the race.

    If it were not for Michael Jordan, the Cleveland Cavaliers and the Utah Jazz would both enjoy world championships. It was in the sixth game of the NBA finals on June 14th 1998 that Jordan gave possibly the greatest clutch performance in NBA finals history. Trailing 86-83 with 40 seconds remaining, Jordan dribbled upcourt to complete a layup. On the ensuing play, Karl Malone was fed the ball in the low post. Jordan steals the ball, dribbles the ball upcourt and completes the shot to guarantee the Bulls their 3rd threepeet and his 6th and final NBA championship.

    In professional football there is “The Drive” and “The Catch” the “Music City Miracle” and the “Ice Bowl”.

    In college football there is Doug Flutie and his hail mary and then there is Stanford-Cal.

    In baseball, there is “Mr. October.”

    In Hockey “The Miracle on Ice.”

    In golf there is one name Tiger Woods.

    Champions are defined not for how they start but for how they finish.

    Steve Leslie

  2. George Parkanyi on March 24, 2008 10:44 am

    I played a little tournament chess in my younger days. To me the most satisfying win was the 4-5 hour epic battle where you threw in everything you had and somehow outlasted a very tough opponent. You leave the game exhausted and a little punch-drunk from all the concentration. Now that was fun …

  3. Greg Vinately on March 24, 2008 1:07 pm

    Perhaps Lon Evans could enlighten all of us on the issue of "taking care of the draws." After a nearly 1.6% rise on the S&P on Thursday and a 2.6% rise midday Monday, one can only wonder how such intelligent individual would "take care of his draws." Besides, he promised to keep us all posted of his "250 handles profit." Or maybe readers will only hear his vitriol on the way down and when he is supposedly "right"? Some vitriol on the way up when he is wrong would perhaps be more enlightening…

  4. George Parkanyi on March 24, 2008 6:02 pm

    Hi everyone, my name is George and I am a recovering system-abandoner. I haven’t abandoned my system for 5 months and 14 days now. As of my last abandonment, my system is down 12.4% and the S&P500 is down 12.8%.

    OK, so I’ve taken care of the draws. Do I get to win now?

    :)

  5. Nigel Davies on March 24, 2008 6:04 pm

    Re Lon Evans, I feel sure that he must have covered those positions in the nick of time, as he will no doubt confirm shortly.

  6. steve leslie on March 24, 2008 11:44 pm

    I think this is a very important point on trading. I hope it makes its way to the post:

    I just read a very insightful book titled “Say Goodbye to your PDI(Personality Disordered Individual) by Stan Kapuchinski M.D.
    The subtitle is “Recognize People Who Make You Miserable and Eliminate them from Your Life for Good.” I found it very helpful to me in directing me in my pursuit to understand the human species a bit better.

    Let me speak on the issues of someone who trumpets their own success without documentation. In short, it is worthless. It is like the accountant who reviewed Hillary Clinton’s trading account and remarked (paaraphrased) I could not figure out where the five dollars went. In other words, he could not discern how anyone could trade a futures or commodity account and have it land exactly on $100,000. I think I learned this one from the very respected Larry Williams.

    I can tell you this after being a very serious student of gambling and wagering for over 15 years, claims of success in this arena are almost universally overstated and there are very few who in the long run make a living off of games of chance. . First, practically nobody except professionals keep exact records of their wins and losses so their comments thereof are anecdotal and nonverifiable.

    Secondly, the law of recency nearly always rules. That is individuals begin with the end in mind and work backward. If they have had success with their last trade, that is where they are going to start and dismiss the series of losing trades that led up to this.

    In the field of poker,I remember world champion Russ Hamilton explain that poker is played by the year and not by the day. This means that true success in poker is after the end of the fiscal year the poker player is profitable.

    Archie Karas was probably the most famous gambler that old town Las Vegas has ever seen. There was a time when he could be up millions one day at the craps table at Binions and completely broke the next. Stu Unger, probably the greatest gin player ever and possibly the greatest no limit hold em player died penniless in a downtown hotel room in Las Vegas. The Chair writes extensively in his book The Education of a Speculator how hard it is to make money in gambling and intangibles after one includes the vig, the take, the trading costs,slippage etc.

    Finally, I think the great lesson that we can all learn from Tiger Woods is how he defines his success. He has been quoted as saying that he does not compete against others but against himself. I have also heard Michael Jordan state that Tiger Woods is THE ONE athlete that he respects.

    sjl

  7. George Parkanyi on March 24, 2008 11:52 pm

    SLOW INVESTING

    At the moment, apart from reading about chaos, ironically I’m also reading “In Praise of Slow”, by Carl Honore a book about the Slow movement, which is about re-assessing our frenetic, scheduled lives and finding ways to slow down and actually experience what we’re doing.

    For example, the Slow Food movement began in Bra, Italy - to some extent as a backlash against fast food as epitomized by MacDonalds - but mainly to return to the joy of eating slow, relaxing, intentionally well-prepared meals in good company. Along with that goes the idea of nurturing and buying local, preserving niche plants and animals species and uniquely local foods, and doing it in a balanced, organic way that ties into treating our environment and ourselves better.

    As I was reading it, I had an epiphany of sorts. I realized that what I am striving for is Slow Investing. And I think I’ve partially achieved that. I use an approach that involves some trading, but trading that is predicated on waiting for the market to come to me, rather than me trying to guess its motives and chase it.

    I’ve tried to set up a perennial garden, as it were, of fixed, diverse, complementary securities that each serve a purpose in certain seasons and under certain economic conditions. Each is carefully selected to be robust enough to weather storms and to not wilt away altogether. (Though alas, some weeding has been required.)

    I don’t harvest completely, I just prune, and the cuttings are fed back in to fertilize other parts of the garden. Admittedly, I’ve been fussing with it too much in trying to get it just right, and the scare of widespread pestilence made me foolishly dig it up twice last year, but it should take less and less time now to landscape.

    Then I should be able to sit and watch it grow, pruning and mulching only when it tells me to. Eventually, when some of the fruits ripen, I can harvest them and use them to enjoy other things in life. But for now, I can tend the garden, I can watch and learn about how its denizens grow and interact, and I can write about it. I can take my time to do this because I won’t have to spend it otherwise constantly searching for new things to plant, at least not until the garden eventually outgrows its space and needs more.

    And perhaps one day I can bring in some other like-minded gardners to share that philosophy and its results.

    Are there any Slow Investors out there you can think of? Warren Buffett comes to mind (plant only the most useful and robust securities and watch them grow huge), as do Peter Lynch (buy local - what you know) and John Templeton (scour the world and taste the exotic).

    “Slow down, you move too fast. You’ve got to make the morning last …” Simon and Garfunkel, 1966

    Feelin’ groovy, :)
    GP

  8. steve leslie on March 25, 2008 10:40 am

    To George: You remind me of Peter Sellers as Chance the gardener in Being There. The movie was based on the novel by Jerzy Kosinski. Remarkable parallels with your analogy and the book. Be careful of your mention of Buffett. I don't want Vic and Laurel to have brain aneurysms. Perhaps Charlie Munger would be a more politically correct reference. Ken Heebner, Christopher Davis, Ralph Wanger, Marty Whitman, Bob Olstein are some who come to mind. Your style of investing reminds me of Gerald Loeb. His method of investing was described in The battle for Investment Survivial. Final note: Lynch remarked that most of his 3, 4, 5, and 10 baggers came as a result of owning them for a period of years. Often four years or longer. I remember him commenting once on Louis Rukeyser's show on why he wanted to own Fannie Mae. This was during the 90s. As I recall that was a big winner for him. Study the growth pattern of the bamboo. For years it barely grows then in a period of a few months it grows to its full height of over 100 feet. sl.

  9. George Parkanyi on March 25, 2008 6:16 pm

    To Steve:

    Maybe I have to re-think — I hated that movie.

    I don't think we have to be politically correct with Laurel and Victor. We're all adults here, right? (I'll have my answer if my post and comments all suddenly vanish overnight.)

    As to your trading comments, they are very well put. Speaking of the vig, I'm sitting here wondering why, for a guy who's trying to slow it down and get into a patient investing groove, I have such a thick stack of confirmation slips sitting on my desk. That's taken a chunk out over the past year for sure — especially the ones with the currency conversions.

    Cheers guys, GP

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