After more than 11 years, this is my last column for Smartmoney.com.
The goal was to examine the craft of trading. As was pointed out from the onset, market discussion invariably dealt with what to buy, but was rarely focused on how to buy, what we dubbed Tradecraft, the discipline and technique of investing itself.
Observe most market banter today and you'll see not much has changed. Stock tips still dominate the conversation, just as they did in 2001 when we began or when Jesse Livermore traded a century ago. Back then he lamented how the average investor desired only "to be told specifically which particular stock to buy or sell. He wants to get something for nothing. He does not wish to work. He doesn't even wish to have to think."
In the modern era, that comes down to "The Top 7 Mutual Funds to Buy Now" and other perennial herd favorites, which, rest assured, will never go away.
Every individual approaches the markets as they approach life: with a distinct philosophy and set of ideas. Those looking for a quick buck, again quoting Livermore, "invariably pay for the privilege of proving conclusively that it cannot be found on this earth."
In many ways the investment landscape is unrecognizable now compared to when we started in 2001. Back then, diversification consisted of adding Cisco Systems (CSCO)
Back then, as is too often still the case, investors fixated nearly exclusively on a company's fundamentals as against what we've always stressed as the most important factor: its price action. That's what we trade. That's all that ever matters, and if you care about making money, all that ever will.
I've often remarked in this column how you don't get any smarter as a trader, you just get more numb. After buying and selling through the 1997 Asian currency crisis, the technology boom, bust, and rebirth; the horror of 9/11, the flash crash, 2008-2009 economic crisis, Occupy protests and ongoing encroachment on liberty, markets rarely surprise me anymore. But they continue to excite me -- and always will.
Trading is a hyper-exaggerated reflection of the American Dream, a relentlessly fascinating and endlessly challenging real-money reality show to which no other activity can be compared. Trading is like everything in life but nothing else on Earth, and the only real way to learn the game is to play it yourself.
In his 1904 classic "The Pit", Frank Norris described it as "some resistless force within the Board of Trade Building that held the tide of the streets within its grip, alternately drawing it in and throwing it forth."
On the trading floor, he saw "a great whirlpool, a pit of roaring waters that spun and thundered, sucking in the life tides of the city, sucking them in as into the mouth of some tremendous cloaca, the maw of some colossal sewer; then vomiting them forth again, spewing them up and out, only to catch them in the return eddy and suck them in afresh."
I've navigated these often tumultuous waters since I've been a teenager and for the past 11 years, I've been honored to share the journey with you.
Thanks for coming along for the ride.—Jonathan Hoenig is managing member at Capitalistpig Hedge Fund LLC. He can be reached at Jonathan@capitalistpig.com