Thursday, November 1, 2007

Finance

So this is more of a personal revelation rather than any advice or status update.


Today I was reading the Wikipedia entry for finance (http://en.wikipedia.org/wiki/Finance) when I realized, this is what I care about. While writing code has had an appeal to me in some elements, like taking a problem and slowly figuring out how to create the elements of a solution, it does not have the mass appeal that lures me to want to do it in my free time. Finance does. In some ways I'm almost obsessed with money. I keep track of where my money goes, how much I have, how my investments are doing almost fanatically. It's like it is what I was born to do.

At one point, in World without End, one of the characters is looking at the other as he is creating a blue print for something he is planning on building. She analyzes the look on his face of completely being engrossed in visualizing what he wants to build and comes to the conclusion that it's the look a person has when they are doing what they were born to do. I imagine when I'm updating my finances and analyzing numbers I have the same look.

The problem I have is that I lack the formal training to do even more in depth analysis and understanding. I feel like I'm right on the cusp currently, so close to bridging the gap between the reality of everyday monotony and breaking free to the world of wealth and abundance that I know exists. It's like the difference between looking across a landscape from a tall building versus looking down from a plane window. I have a general perspective but I need something to get me to that higher level of abstraction so that I can see the trends before they happen and jump in and ride the wave up. Right now I'm getting there a little too late but luckily, not at the same time as the people who jump in only to hit the downward spiral.

In reading The Pathfinder, it talks about how you should have a job that you truly love. Jobs like that do exist and you can get one. It's just a matter of determining what it is that you are really excited about, what you are already doing in your free time and you just don't know it yet. I always think of the Seinfeld episode where George has quit working as a Realtor and he's talking to Jerry about what he could do next. He lists different things he's interested in and Jerry gives him a little perspective as to why they might not work out (http://www.tv.com/seinfeld/the-revenge/episode/2252/trivia.html).

So now that I feel like I know what I want to do, the question is how to get there. I guess I should start trying to figure out where I could get an entry level position that will pay for me to get an MBA and then start applying or finding connections that can help me. Maybe I was right about my gut feeling that November would bring about some kind of inspirational change.

2 comments:

Thomas said...

What are your experiences using Fibonacci series in stock trading? Does it actually work?

~christophany~ said...

Let me say upfront, I've never actually tried to use Fibonacci series in stock trading.

My opinion is that it most likely doesn't work. Let me explain why I think that.

First off, if it did work as well as the websites with tools and computer programs promoting it say it does, then everyone would do it. I realize that's a pretty weak rationale to start, but success usually draws people in and keeps them, so eventually a large percentage of people would be applying that approach.

Second, on any given day only about 10% of the shares of a company are being traded. Usually large profits are made very quickly when the big money moves. The big money doesn't move on a whim, they usually change when they see a large shift in expectations, so trying to capitalize on the ups and downs of daily trading is possible but very hard to have success rate.

Third, large amounts of trading can be profitable but any gains will be highly taxed. The fact that you're trading a lot and taking brokerage fees is also counting against you. Usually in order to do that, you have to have 25K or more in your account so you can be considered a day trader and valuable enough to the brokerage for them to let you move your money around that fast.

Personally, I'm going to continue to promote the value investing approach.