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THE RISKY ROAD TO PERSONAL AND FINANCIAL FREEDOM
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Why would anyone be interested in a risky business like trading? Why does it have such attraction? One reason is that trading commodities may be the last bastion of free enterprise. The profit potential is unlimited. If you have owned your own business, you have experienced the downside of motivating workers and dealt with governmental taxes and regulations. You know that the success or failure of your business can be affected by others, in ways that are outside your control.

If you are employed by a small business or a large corporation, you know about difficult managers, salary limitations, and the risk of job loss. Even if you are a professional charging hundreds of dollars an hour, your income is still limited by the number of hours you can work per week.

In contrast, trading futures offers you personal and financial freedom. You can live and work wherever you choose. No one tells you when to be at the office or when you can take a vacation. You report to no one but yourself.

A good trader increases income by adding contracts. The amounts of work and of time are the same, but the payoff for staying at home and placing telephone calls to the trading floor or to a broker can be very rewarding.

Unlike buying and selling stocks on margin (you pay interest), in commodities, you can put most of the money in your account into T-bills or overnight money markets (you receive interest) while using 80 percent of the T-bills and 100 percent of the money markets as trading margin.

In trading your account, there are no consumer problems, no customer relations, no complaints, no theft, no returns, no unions, no employee benefit plans, no stockholders, and no boring board of director's meetings. You won't have to worry about advertising costs, employees, service calls, repairs, or returned or damaged goods.

Why doesn't this list of freedoms attract hordes of people? It does; and 90+ percent of them end up as losers. The other side of the profitability coin is that the winners will always have an ample supply of traders who, because they don't understand the market, will furnish the winners with profits.

Warren Buffett expressed this eloquently, in comparing a poker game with trading: "If you are in a poker game for twenty minutes and you don't know who the patsy is— you are the patsy. If you are in a commodity trade for twenty minutes and you don't know who the paymaster is— you are the paymaster." One purpose of this book is to make you patsy-proof and keep you from being the paymaster in your trades.

Most people are negative about trading the market. They feel this is a high-risk career because only a small percentage of traders are consistently profitable.

What they don't hear is that traders who do not listen to brokers, do not read newsletters and the Wall Street Journal, do not consult CNBC-FNN and similar sources, can be highly successful. Listen to the media or let your broker steer your account, and you'll be back at work in no time.

There is risk in trading. There is also enormous risk whenever you drive your car. On some highways, only inches separate your car from the cars speeding in the opposite direction. A swerve of only a few feet could bring a death-dealing head on collision. Every time you take a short drive, you are literally risking your life. Yet you drive almost daily and remain suave about the danger. The reasons: you have gained understanding and experience.

As you gain understanding and experience in trading, the markets need be no more dangerous than the route of your Sunday drive. For safe driving, you must have a vehicle you are familiar with, the right tools in case repairs are needed, and the right attitude. That is what this book is all about: having the right understanding and the right attitude for using the right tools.

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