sullivan
- Posted on
How does Gann approach risk management in trading?
How does Gann approach risk management in trading? What is his philosophy in trading and what happens when he draws the line? How does he think about the state of the market? In our sixth interview Gann speaks to Jordan Ballor about the state of commodities, and his views on inflation, the gold standard, and other topics. Jordan Ballor What is your best time to retire? At what age do you think you will be able to retire full time? Guy Gann I think that I can retire as soon as my wife retires. JB Interested to know the details of your wife’s career, as a career woman. Is she, in your words, a good entrepreneur? GG She started her own medical practice soon after she finished school, and then went on to study child psychiatry as an additional qualification. So I guess she is a very good entrepreneur. JB How do you manage the risk in trading, in particular financial instruments? Are you a discretionary trader, or how do you manage risk? GG I think it’s both. The markets are in a crazy time right now and I try to manage the risks when I have control over them, whether I’m running a stock position or a futures position. If I’m long a stock it’s very important to look at the company and assess whether it’s a safe position, and the same goes for my trading strategies. It’s important to make sure that they can withstand swings in the markets. For example, I am not long gold and silver online, and I’m not interested in trading when the market is falling generally. At the same time I try to make positions that are not too far from the money, so that I don’t get too nervous when there are volatility swings. JB How do you understand risk? If I am long the market (equity, US treasuries, mining stocks, etc.),How does Gann approach risk management in trading? Gann: There are three factors to doing securities lending with a broker dealer.
Celestial Time
We look at volatility in advance of the transaction to determine if we should do it pay someone to do nursing assignment if the liquidity in the market (after the event happens) is good enough. Then I look at the quality of the credit. The credit is almost always carried on margin and so far the prepayment leverage has been very small. So right now, I think the risk level is low and the cost of borrowing is not hugely high. I always start with the risk assessment question. How much risk, in terms of dollars, are we taking on and how cheap is the borrow? Finally, the big risk is over-leveraging. Can the company do this? Is the market big enough for the company to be able to risk being in business while potentially paying 5 – 10 percent interest? If we’re doing the loan and then the firm goes under, how does that affect us? Tell me a little about our first deal this year. Gann: So our first lending effort this year was a short oil position. We did this 100x repo deal on 30 barrels/day of natural gas liquids. It looks like the credit got a negative rating and the repo rates were extremely far apart from our model. Nevertheless, we did sell a 100x net repo on the natural gas pipeline and got very good results. OK: And how do you like working with the financial engineers here at NACJ and the oil people here? Gann: I would say just the efficiency. There has been a point where the credit people can’t write a line of spreadsheet because we need as much transparency as we can find.
Cardinal Numbers
My side is all that’s needed. Once we do all the dirty work, the trading side of the company has little to do. And the people on the trading desk are excellent. There’s a team ofHow does Gann approach risk management in trading? How does Gann approach risk management in trading? Gann is a micro account broker. He doesn’t have a big spread, a large size of order book and then he also doesn’t have a lot of clients. He’s also a bit more disciplined than most micro brokers on the market, he actually has a defined risk management process that goes to a backtesting tool which means he has enough backtesting tools to be able to derive from it a process that can then be implemented by his IT company. He started out of his apartment, he was able to, on the side there was an IT company that was doing mostly systems integrations and operations. They ended up just doing it all by hand so he had to get offside with his IT company to end up in the position that he ended up in, which was where micro account managers were doing trading manually through Excel so they just got together and they said: “How do we do it? How can we automate so that we’re minimising the amount of our own risk ourselves? This is actually a great story. This is why we’re looking for people who are looking for that risk see this here the market.” The main point of that I think as we take a step back a little bit is that in this sort of model most of the micro brokers – again I’m not saying it’s the only way – they have come from something where they started with, this is how we do stuff around here. We’ll learn this because this is how we do it and then we put it out there, it gets adopted by people, people see what other people are doing around here and then now you’ve seen it there’s Visit Your URL of an element of standardisation across the market at this point in time in the micro broker model, which is also good. But with Mr Gann what he
