Trader Gary Smith - Start with One Stock
Gary Smith has become a very famous person in the trading world thanks to his book entitled How I Play and Win on the Stock Exchange. His biography is radically different from the template success stories, because he fought his right to wealth from fate for 20 years.
Unlike many, he did not seek to create his own hedge fund or large investment company, but his goal was to get rich and be as independent as possible from anyone.
This is why Gary Smith’s name cannot be found on the list of top asset managers, but he has become an excellent example of self-realization as a private independent trader.
Love for easy money
Gary Smith knew from childhood what he wanted to become and persistently pursued his goal. He began to show his love for easy and quick money back in high school, when his class went on an excursion.
He associated this with the fact that the roulette axis wears out and therefore a certain tilt appears, and also each croupier has his own strength with which he constantly spins the roulette. Having found such a simple pattern, Gary Smith used roulette as an additional income for many years.
The second incident that Smith himself recalls occurred when his father gave him his coin collection. Instead of continuing his father’s hobby, he immediately began actively selling coins. Moreover, he was so fascinated by the prospect of making money on coins that he began to actively find them in banks (exchanging large bills) and resell them to collectors for big money.
As Smith himself recalled, the demand for coins was so great that he managed to earn about 150 percent from one resale transaction.
The third case of love for quick money appeared when Gary Smith mastered the card game Bridge. Of course, at a young age he did not have the mathematical ability to create certain patterns of play, but unlike many, he had a photographic memory.
It was enough for him to see a card once to remember it and understand which cards remained in the deck. Actually, like roulette, bridge was a constant additional source of income.
Getting to know the Exchange
In 1961, at the age of 14, a young man came across an interesting book by the great trader Nikolos Darvas, on the pages of which his path to success on the stock exchange was described. The boy was so attracted by the dream of becoming a trader that at the age of 14 he completely decided on his future profession.
Starting at the age of fourteen, Gary Smith actively began his studies and created his own collection of useful books, the number of which currently amounts to more than 450 copies. However, he first tried independent trading only when he was a sophomore at the University of Dayton in Ohio.
The first five shares of Chrysler stock he bought cost him $200. After his first stock purchase, Smith sells his coin collection for $2,000 and makes his first deposit.
A series of failures
The rosy prospects that Smith had painted for himself from a young age began to crumble to smithereens when he traded independently. So, his first and most notorious mistake was entering the commodity exchange without a stop order, and as a result, an instant loss of the deposit. Actually, if we talk about Smith’s mistakes, we can note a series of failures over 19 years, when his deposit was almost always drained or was in the range of 2 to 4 thousand dollars.
Since the stock exchange completely absorbed his life, he was not interested in any robot, so he was constantly fired from various positions due to a simple lack of interest in the business. The only thing Smith remained good at was gambling. However, not a single casino needs a successful player, so they began to interfere with him in every possible way and kick him out of the establishments.
A long-awaited success.
In 1985, when Gary Smith practically gave up and decided to quit trading, he decided to do a very in-depth analysis of his transactions. Just think, it took Smith 19 years of unsuccessful trading to start working on his mistakes. After realizing that he was trading aimlessly and not adhering to money management rules, Smith reconsidered his trading tactics. His main trading instruments were futures and mutual fund securities.
Since then, trader Gary Smith has always successfully closed the month, and his success statistics simply cannot be surprising; the average profitability is 50% per annum. Actually, he shared the annual statistics with his readers in the book “ How I play and win on the stock market».