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Some interesting stuff here on John Key and his style of currency trading,would also be interesting to know how successful the best local traders are?
this comes from an article called Keys path to the Top
stuff.co.nz/stuff/0,2106,3880392a6160,00.html
He stayed with the company till 1985, when he saw a television programme about a day in the life of a foreign exchange dealer, Alan "Sooty" Cole. "I thought, I can do that."
The Lange/Douglas government had just deregulated the currency market and Mr Key was transfixed by the drama, the excitement and the money on offer. Traders were paid a salary and a bonus depending on how successful they were at "making pips" - a margin on currency traded.
The difference between selling a New Zealand dollar for US65c and US65.05c is only .05c. But sell 10 million and the difference becomes US$5000. Dealers make hundreds, if not thousands, of such transactions, every day. The best are those who consistently sell high and buy low.
From the beginning, Mr Key had a feel for the market. His starting salary as a trainee at Elders Finance was $75,000 and his first bonus - after six months - was another $75,000.
"It's all about pattern recognition and intuition and confidence. You need to be confident, but not cocky," he says.
Some of his peers considered him a big risk taker because he took big positions. But there was a method to his madness. He usually held the positions for only a few minutes.
Other traders took smaller positions, but held them much longer, dramatically increasing their exposure to market fluctuations.
He was also flexible enough to reverse out of a position when he realised he had made a mistake. "I'd go out and belt the market and if it didn't go down it meant to me it was going to go up and I'd buy two times as much and get out of it."
In 1988, he was headhunted by Bankers' Trust to head its currency operations in Auckland. He scored an early coup when Roger Douglas was sacked as finance minister by David Lange later that year. The market had been anticipating trouble and everyone knew Sir Roger's departure would drive the dollar down, but when it happened the news was slow filtering through to the markets.
Mr Key heard about it over the car radio on the way back from a family funeral. Walking into a quiet dealing room, he instructed the bank's traders to sell all they could. They made between $2 million and $3 million for the bank that day.
At the time he joined Bankers' Trust, the Australian investment bank was a third-tier operator in the New Zealand market. By the time he departed, in 1995, it was New Zealand's biggest currency trader with daily turnover of about $1 billion.
Mr Key, according to his then-boss Gavin Walker, was the country's dominant dealer. "He was not only number one in New Zealand. In terms of the Kiwi dollar, he was number one globally. People came and dealt with him because he was John Key. They knew that they could deal with him in large volumes, narrow prices and his word was his bond."
When he left Bankers' Trust, New Zealand's top currency traders were earning up to $750,000 a year. Mr Key, as a manager, was paid more. Asked how much, he laughs awkwardly: "A lot, relative to the New Zealand market."
But the real big money came when he shifted to London as the global head of Merrill Lynch, with more than 100 traders reporting to him. At the time, the company was offering key staff big "guarantees" if they stuck with the firm. Mr Key took his guarantee in the form of stock options. He also took most of his salary the same way.
Again, he won't say what he was paid, but industry observers says no one in his position would have earned less than 2 million at a time when top traders were pulling in more than 1 million a year.
By New Zealand standards, his salary and guarantee were huge, but his biggest gains came because Merrill Lynch's share value increased five-fold during his six years in London. Over that time, a 1 million (NZ$2.7 million) guarantee would have turned into a 5 million (NZ$13.
I mentioned part of this article on the 'Off topic' thread. Interested to see if politics allows him to keep his word - maybe politics is such that it is impossible to tell the complete truth and get the votes.
George
Just a chart update guys as they went to custard in the last hour,so talked to a guy at FXCM and he told me that they are third party charts and power charts are aware that there charts are sh*t(not in those exact words thought hehe;)) but couldn't say if and when they will be sorted,great:(.
Looked at Dania but as far as can see I cant set up 4 charts per screen with them?.
Anyway as have said keep an eye on the dealing rates and the charts to see if the same,not such an issue for people setting buy sells but a pain if watching for trades.
Cheers
Miner
Just looking at eur/usd on Dania and it is the same as power chart,not to bad only about 15 Fing pips out,others up to 20 pips:(.
Cheers
Miner
Hi Miner
see what you mean,even on Dania following the Aud chart can be up to 3 pips out on dealing rates
Keep an eye on rates and charts Roddy as lately up to 10minutes behind(candles don't change) and 20 pips out,so useless for trading,day time not so bad but at night when it warms up they go to custard.
Cheers
Miner
They have a serious problem then Miner, any thoughts on what you will do?
cheers roddy
use fxgame!!
the quotes match mine (Marketmaker) almost perfectly and you can run multiple windows.
http://fxgame.oanda.com
The guy I talked to said that FXtrek Intellicharts were the most reliable,so may try there free trial,as having to watch to see if the charts are right on top of looking for a trade is a tad tricky shall we say.
They may come right again as have not had these problems for a while.
Cheers
Miner