So, when Livermore is on vacation, he describes, in painstaking detail, each of the fineries that he encounters, even if it is only something as simple as a nice stroll down the Atlantic City Boardwalk with a friend. A virtual Jay Gatz in training, Livermore lets his readers know that as a stock market prodigy and one of the most famous (and infamous) traders on Wall Street, his time off is well-earned. However, Livermore always seems drawn back to the market in one way or another while on vacation. He may be fishing off of a boat in Florida, for example, and he will somehow catch word of a development in the markets, or he may be meandering down the avenue and stumble upon a bucket shop where he sees a stock price that piques his interest. In either event, Livermore feels compelled to cancel the rest of trip and return at once to the stock market. What usually ends up happening after summoning himself back to trading, is that in the very next chapter Livermore finds himself broke, cleaned out, or at least down to his last few dollars. As readers we may mistake these episodes for comedic irony as Livermore is always so whimsical, upbeat, and confident that it is nearly impossible to think that any truly dire tragedy would ever befall him. Yet, Reminiscences was written during the Great Depression and takes place just after the turn of the 20th Century up to the years right before the Depression, when industrialization and immigration had, for better or worse, begun to leave lasting impressions on America's social, political, and economic landscape. So, the book is naturally rife with serious overtones and pointed social commentary; sort of a hybrid between the work of Henry James and Upton Sinclair's The Jungle. Therefore, Livermore's frequent failings in the stock market can be a metaphor for the idea that prosperity is fragile and uncertain, and that it must be protected and nurtured as it is cultivated, much like America itself. Yet, Livermore embodies the indomitable American ideals of tenacity, resolve, and perseverance, making him a truly All-American man.
Since, however, well-earned time off for hard work well-done is also a major facet of the American ideal, a major point of the book, which we see embedded in Livermore's financial missteps, is that you must know when to take a step back from your work. It is a two-pronged warning; the first of which reminds us to temper our ambitions because they may undo us in the end, and the second tells us that we should take time to enjoy our success as fully as we can, for it is that which not only makes the hard work and prosperity worthwhile, but also what seperates our American way of life from that of others.
Life Gets in the Way
There are no predetermined, extended breaks in the stock market. For all intents and purposes, it is always open. Also, as volatile as it has become, there is no real slow period in the markets anymore, be it equities or futures. I distinctly remember my father taking nice, long 4-day weekends in the summer when I was younger, as you could practically count on slow going in the markets on Mondays and Fridays, during the warmest months. About 10 years ago, my father was all but retired. However, the markets are now so busy, and there are so many opportunities to make money, that he is back at work, full time.
Of course, now in his 60's, and with 40 years of trading under his belt, my father can afford to take time off and he regularly does. Presumably, he has amassed the money that he feels he needs, and his children are all grown. But, he loves to trade and is taking time to teach myself and my brother how to become successful traders. So he does indeed have a full time job again because he has responsibilities to fulfill. Since we all have any number of responsibilities, it is very important to put our jobs and our lives away from our jobs in the proper perspective and balance them off of each other.
If you really like to trade and the market happens to be in your favor, you never want to miss any trading action and the truly dedicated traders will tell you that nothing could pry them away from the markets. My father told me that guys on the trading floor used to joke that if they died during a hot market, they would get up out of the casket after their funeral and head right over to the floor and continue trading. It was the camraderie of the floor that made it such a wonderful place to work for so many traders, kind of like the world's biggest fraternity house. With so much trading now being done electronically, the atmosphere and prosperity on the floor is not even close to what it once was. Still, regardless of where you trade from, the market is still as active as ever, if not even more so than ever, and every day taken off is a day without income, especially for day traders, and the possibility of a missed long-term move in the markets.
It is the fear of missing something important that often causes so much anxiety when we consider detaching ourselves from those things that we tend to involve ourselves most deeply in. For example, I have certain friends (and I am sure that we all know the type) who will never miss a party or certain other sorts of social engagements because they fear not experiencing some grand, earth shattering event, as if the long-awaited love of their life is bound to be at that party. Many people also fear that their absence might disapoint their friends and hinder their social status, causing insecurity over the possibility of diminished social relevance amongst their peers. Other times, people just like whatever it is that they are involved in want to be part of it as often as possible.
My family has a summer home on Fire Island, a long and narrow barrier beach off of the south shore of Long Island; there are no cars, people walk around bare-foot, ride bicycles, and use little red wagons to tote around their belongings. And, like the famous bar from the television show Cheers it really is a place where everybody knows your name. I have been going out there every summer since I was born and have cultivated a fantastic active and social life on Fire Island. Many of my closest, long-time friends also have homes there and my wife Blythe has embraced the island's leisurely and laid-back atmosphere as well. For me, be it for a weekend or longer, spending time on Fire Island is the perfect vacation. As with most people who have homes on Fire Island, being out there becomes a priority during the summer and they are usually reluctant to make plans of their own or even accept invitations for plans off island. Much to the chagrin of friends and acquaintances who do not summer on Fire Island, many who do have a general policy of "if it falls between memorial day and labor day, please don't invite me." As far as I know, a lot of people who hold sacred certain places and activities have a similar attitude, as self-righteous as it may sound.
When I was first out of college, I had a few freelance jobs in television. I had thought throughout college that I was going to be a newspaper journalist and that ambition eventually morphed into broadcast journalism by the time I graduated. As a freelance production assistant, I generally worked odd hours, as needed, which invariably meant plenty of nights and weekends. My first real freelancing gig was with NBA Entertainment, which produces practically every single piece of programming about professional basketball that you see on television. For a young sports fan like myself who was interested in a career in television, it appeared to be something of a dream job, which involved going to basketball games among other fine perks. Like I said, however, the hours left something to be desired. Not only did I work mostly during those times when most of the rest of the working world was not, but the hours were inconsistent. I was paid hourly, without benefits, and although I had fairly regular hours (which were unfortunately on nights and weekends, as I said), there was a limit to the hours I could work in a week. I eventaully became disenchanted with television. It was neither glamorous, nor exciting; basically a lot of time spent alone, pouring though game video, with nobody else around but the janitor. To make matters worse, I was not making enough money to move out of my parents house. So much for showbiz.
What I did have going for me was the maximum hours per week I could work, which was around 36 per week, with occasional overtime allowed. I figured that I would take advantage of the maximum hours by loading up during the week so I would not have to work on weekends, meaning I could spend my time out at Fire Island. If I was working at night, I would put in an extra hour. What did it matter? Nobody else was there, at least nobody who would care. I would find out which other PA's were either sick or on vacation and I would work their hours for them whenever I could, meaning I would either work a double shift or, better yet, not have to work my usual night hours. Either way, I had my weekends free to spend on Fire Island. One day, however, one of the executive producers at NBAE demanded that all PA's honor their actual schedules, citing the fact that too many of us were doing as I did, and adjusting their schedules as they saw fit, frequently leaving the studio short-staffed. So, it was sometime right before Labor Day, at Summer's pinnacle, that I was ordered back to work on weekends. Venting my frustration to a friend at a bar one night, he simply told me;
"Charlie, sometimes life gets in the way."
He was right. Sometimes we cannot help but to be drawn away from that which we love. As much as the idea literally nauseated me, my situation at the time required me to miss precious time on Fire Island. Begrudgingly I went back to work on weekends. Whatever happened on Fire Island for the rest of that summer is a blank slate to me. Whatever tales of merriment and melancholy that I heard from my friends have been stricken from my memory. Shortly thereafter, I left the television business. Another occupation that had always fascinated me for a variety of reasons up to that point was teaching, not the least bit because I thought that work schedule allowed time for me to engage my personal interests. Still, I have since become much more open to the idea that I cannot always do exactly as I please and time must sometimes be given over to other responsibilities.
You Always Hurt the Ones You Love
So, I was miserable when I had to sacrifice something that I truly loved (the beach) for something that I was increasingly becoming sour on (my television career). But, what happens when you have to pit two things that you love against each other? Can you ever truly win? First of all, to say that if you prioritize one such thing over another is unfair. Just because during a particular year you regretably concede that you will not be able to take your usual family vacation, for example, because the market is so busy does not mean that you do not cherish time away with your family. I distinctly remember being very young, perhaps five years old, and my distraught mother weeping as she got off the phone with my father because he told her that we would not be going on a much anticipated trip to Florida, saying that he had too much going on at work. Indeed, our bags were packed, we were due to leave perhaps even the next day, and we were all terribly disappointed that the trip would be cancelled. But, could my father really be blamed? At the time he had two young children at home and a small commodities firm that was becoming profitable. Perhaps taking himself out of the market to go on vacation at that time might have put both his family and his business at a major financial disadvantage. While I may have sulked to no end as my hopes for a pleasant chat with Goofy at the character breakfast were cruelly dashed, when I look back on my life thus far, I can honestly say that I have not suffered to any great extent as a result of that episode. Besides, as I recall, we ended up taking the Florida trip a few months later. As a man who enjoyed both his success in business and time with his family, I am sure it was difficult for my father to forego the trip at that time. But, as we know "sometimes life gets in the way." The real problem comes when we actively avoid other facets in our lives for the sake of our jobs.
As I have noted numerous times, I love to trade. In fact, I am at the point now where I enjoy this work so much that I will miss vacation time, be it on Fire Island or elsewhere, in order to concentrate on my job. In my two previous undertakings, when I was in television and when I was a teacher, that would never have been the case. Indeed, my job is a priority. And, that is the way it should be. I am married, in my early 30's, and have family goals and lifestyle goals that will be much more easily attained if I concentrate on my work. If I do not give trading the appropriate focus, I may miss my chance to meet my life's ambitions.
In most cases, however, I am delighted to step away from work, especially if the time off had been planned for, although sometimes it is difficult to pry myself away. Time off for me is very subjective because it is often based on how the overall market is acting at any given time. It would be very convenient if I could anticipate which times of year would be busiest, which would be slower, and plan my vacation accordingly. While it is somewhat true that you can count on certain times being slower than most, for example the days leading up to a major national holiday, the markets are generally so volatile that one runs the risk of missing a significant move or other major development when he or she removes oneself from the market. My wife, Blythe, who is a 4th grade teacher, has several vacations built into her work year. Therefore, I try and plan my time off for when she is off. It just makes more sense that way, that I should take off based on her schedule, rather than her taking off when I decide to if she already has vacation time available to her. Coincidentally, Blythe's breaks fall during the times when people commonly go on vacation, such as around Christmas time, spring time, and during the summer. During those times of the year, I feel rather comfortable planning time away, as many traders will go on vacation as well. Blythe obviously looks forward to her breaks (believe me, she works very hard) and when she has the time to relax or to travel, I like to be able to do it with her.
Taking time to be with one's family and loved ones is vital to overall well being. Growing up, I had frequently heard the term "workaholic" but thought of it as some overused cliche aimed at shooting down dedicated, ambitious overachievers. However, having been in the workforce for more than a decade now, I have come across numerous individuals who have put themselves at all sorts of personal disadvantages, ranging from missed experiences and opportunities, dwindling friendships, and spousal resentment (often culminating in divorce), because they hardly ever took time away from work.
In order to keep a certain Harry Chapin song from buzzing around your head because an unusually busy period at work might have caused you to miss your child's music recital, it is important to honor the time you had set aside for your family and other obligations. While there is no way to avoid every unexpected situation that might sabotage the random guys' night out or force you to not be able to pick your child up after practice, you must try and avoid letting things interfere with the highly anticipated plans that you had been looking forward to for a long time, such as a vacation that had already been booked. That way, if you have to miss something from time to time, you will not have to feel guilty that you are blowing off the other important people and activities in your life, at least from a big picture standpoint.
Hindsight Will Get You Nowhere
I find it rather easy to detatch myself from the market when I have made up my mind that I will do so, especially if others are counting on it. Whether it be for just one day because I need to take care of some appointments or if it is a week's vacation, I try not to let the markets dictate whether or not I am able to take whatever time off I had set aside. When the day arrives that I had planned on taking off, I spend barely any time looking at the markets, and will not do so until I had planned on returning to work. The reason is, that I will often get caught up in thinking about what might have been, had I decided to go to work, which will only cause me to resent myself. Anytime I take a moment to sneak a look at stock charts, or find out a market quote when I am officially not working, I grumble that I would have had a great day if I had only been trading. To say such a thing is unfair and unrealistic. Whenever I go back and look at a chart after a day when I did not trade, I convimce myself that I would made all the right trades that day, that I would have bought every dip and sold every rally. Or, if I hear that the market is higher, for example, I maintain that I knew it would be and I lament all of the hypothetical missed buying opportunities. Yet, as we all know, the word and the deed often do not match and it is foolish to say that I would have necesarily made the proper trades had I been working that day. Hindsight may be 20/20, but it is never as clear as good, old fashioned reality. Out of respect for my loved ones, the plans with them that I had committed to, and my own sanity, I try and stay as far away from the markets as possible when I have decided not to be involved. It would be to your benefit to check in with the market at the end of the day, just to see how things ended up. That will only make you better prepared for when you do return because you will have points of reference on which to base your trading decisions. There will be certain times when you have to be involved in the market, even if from afar, because you have long term positions or options positions on, which need your attention. You may find yourself calling in to your office or to your clearing house numerous times in order to manage your positions. Doing so is absolutely vital to your overall financial success and even when on vacation you may have no choice but to keep a close watch on the markets. Sometimes, you have to compromise between taking a complete vacation and not taking one at all; perhaps it is both a blessing and a curse. However, if you are off from work but are not actively involved with positions, checking in with the market should be like checking in with a sports score. You just might want to see how your team did, but you will not fixate on it. If you are exclusively a day trader, I would not recommend, for example, bringing your laptop, loaded with trading software with you on vacation. I'm sure your wife would not appreciate you sitting in your hotel room, executing orders, when you and she were supposed to be getting a beachside couples massage. On the other hand, if you had spent the day around the house and have access to your computer, it would not hurt to spend a few minutes with the charts as long as it does not interfere with your plans for the day. One thing that I make certain of, though, is to NOT TRADE if I did not intend to. I have tried on certain days, when maybe I felt guilty about taking off because I needed to run errands, to put on a few positions from my computer at home and then take care of my personal affairs. Although I may have made money on a few of those days, I usually end up mismanaging the trade in some way or another and I always end up ignoring part of my other responsibilities because I had taken time to focus on the market. Therefore, nothing I had done turned out as I would have wanted it to. Successful trading requires the appropriate amount of focus and if you cannot give the markets their due focus on any particular day, then you should not trade.
Know Before You Go
Another friend of mine, Marc Jacobsen, a trader in the copper ring on the NYMEX's COMEX division, who also trades stocks and commodities on the computer calls the computer Computer Crack. It is a terrible notion to equate the tools of our trade to a highly lethal and addictive narcotic, although many traders do indeed find the markets to be quite addictive (subsequently, there have been studies and articles written about the similarities in brain activity between a drug addict on a fresh high and a trader who has just taken on a position). It can be this addiction to trading that keeps many traders standing in the ring all day or glued to the computer every minute of the trading session. Let it be known, however, that an unhealthy obsession with the markets will not necessarily make you a better trader. Trade stalkers, which is what I call those who spend the whole day chasing trade after trade, probably end up about as successful in their endeavors as celebrity stalkers, meaning not at all. It is important to realize that at anytime during the trading day, and for whatever reason, you might need some time away from the market. Suppose you had hoped to run an errand at some point during the day or maybe you just felt like you needed to take a walk to clear your head if you had been having a difficult day trading. You should not feel obliged to keep trading. If you do not take periodic breaks during the day to either take care of personal matters if you need to or as a benefit to your own mental health, you may feel pressured in other ways and might even grow to resent trading.Still, you should always bear in mind that there are better times than others to take a break from the markets. For example, it would not be advised to step away from the market during a time when there might be heavy volatility, such as when an important economic report is coming out. While you should probably not have any large positions on going into the report and should probably not put on trades immediately after the report, you will most certainly want to have an eye on the markets so you can see how it reacts to the report, and try and plan your trades accordingly.
Whenever you leave the office, and this is very important if you decide to keep positions on when you leave, you must know how long you plan on being away for. Otherwise, you will not be able to properly manage your positions, making both your involvement in the markets and in your errand more stressful and very likely less productive. I recently volunteered to drop off some paperwork for Blythe's pension. It was during the summer so she had off and enough time to do such chore on her own. But, the summer was coming to and end, so I wented her to have as much time to herself in her last few days of vaation as she needed. Besides, the office she needed to go to was right near mine and I figured I would let her enjoy her vacation rather than go all the way downtown just to drop off some paperwork. And since, I thought all I would be doing was dropping off some paper work, I figured I'd pick up a sandwich after the task was done, the whole thing taking less than 30 minutes. On that particular day, I had a small position on in Hess oil (HES) and although I had been losing money on the position from earlier on in the day, I decided to stay in the position and ask my co-worker Kevin to monitor it for me while I was out because I thought that the position would turn out in my favor and therefore did not want to cover prematurely. I assured Kevin that I would only be away for a few minutes but that I would call in once or twice to see how things were going with Hess.
When I arrived at the pension office, I immediately sensed that I was in trouble. First, I had wait in a line to present my ID and sign in with a security guard. That took about five minutes. But, I hel out hope that it might not be so bad after all, that it was just a high-security building and all of those in line could not possibly be going to the same place I was going.
Boy was I wrong. When I exited the elevator into the pension office, I swear I had just entered an airport boarding gate. First I had to stand in another line, amongst rows of aggravated people sitting in padded chairs, to receive the number for when I would be called to drop off the papers, kind of like when you get in line to check in for your flight. The numbers were not necessarily chronological but were coded to correspond to a particular inquiry, each of which was assigned a letter. So with "B215" as my number, I saw plenty of people with numbers like "D498" and "H874" go ahead of me. Then I had to wait around a cavernous office that was becoming increasingly more crowded, as members of the disgruntled horde began squatting against the walls, and sprawling out on the floor, looking up at the red LCD screens around the room that displayed the numbers being called up for service.
It was a tense atmosphere to say the least as each of the teachers in the room came to the horrifying realization that they may indeed end up spending one of their final, precious days of summer vacation in the offices of a bureaucratic institution. Many made frantic cell phone calls, alerting friends and loved-ones that whatever plans they had for the afternoon might not materialize, in the process sending their love. Indeed, nobody had expected such a situation, myself included, as I called Kevin back at the office perhaps 10 times to see where Hess was trading, ordering him to cover certain parts of the position at certain prices and get back in at other prices, all the while asking him his opinion of the chart since I did not have it in front of me, and doubtlessly causing him to ignore his own positions.
All in all, the whole trip took close to three hours. I left the office to drop off some papers during lunch and while the actual act of dropping off the papers took about 30 seconds, the waiting time took up half of the trading day and I got back to the office basically in time to close out my positions and go home. When I left, I was losing money in Hess and when I returned, I was down about the same amount, so at least I did not lose any more money. But, could I have turned the trade into a winner or at least less of a loser had I been in the office? Perhaps. The main loss, when all was said and done was the mental frustration that I endured by having to be somewhere that I didn't want to be, for longer than I thought I would have to be there, when my real obligation was elsewhere. Because of that experience, my trading on that day was more aggravating than it should have been and the satisfaction and peace of mind that came from knowing that Blythe's pension was in order were tempered by the fact that the darn errand took so darn long. But whose fault was it? Certainly not those at the pension office. Sure, I can think of 1,000 ways that they could expedite their services (and believe me, I had time to do it while I was waiting). But, when dealing with large, government agencies such as a public school pension office, one often finds oneself waiting around. It was not Blythe's fault. I volunteered to go to the pension office, to take time away from my responsibilities to my job. She would have gone herself. If anyone, the blame was on me. I should have found out how long I would be away for. I could have called the pension office to see what the anticipated wait time would be, or if there was some other way to file the papers, such as filing online. That way, at the very least I would have been prepared for what I had encountered and could have planned my trading accordingly. Probably, I would not have volunteered to go if I know it would take so long. Blythe understandably felt bad about what had happened and appreciated me going for her, just as I am always more than happy to help her out in such ways whenever I can. However, to be unexpectedly away from work for so long and leaving someone else to watch my positions was irresponsible, unprofessional, could have resulted in serious loses, not to mention the loss of my job.
The Most Important Person is You
Among the many positives that I took away from my years as a high school English teacher, which was my second professional stop on the way to becoming a trader, was that I had the opportunity to work for many of those five years with a wonderful man named Charles Osewalt, who was first my Assistant Principal of English, and then later became my Principal. Mr. Osewalt was an incredibly compassionate and understanding man, who never hesitated to put himself at an inconvenience if it would benefit someone else in need, be it teacher, student, or parent (not to mention his own friends and family). If ever there was someone who deserved a day off, it was Mr. Osewalt, who still works tirelessly, day and night, to provide the best possible educational experience to all involved in his school, the Morris Academy for Collaborative Studies in the South Bronx. One of Mr. Osewalt's greatest qualities was that he knew how to relate to the struggles of young teachers and to comfort them as best he knew how.
Whenever I would come to his office, frustrated at how things were going with my students, as I struggled with classroom management, absenteeism, not to mention my own personal shortcomings, Mr. Osewalt would always remind me that "the most important person is you."
This meant that regardless of whatever personal needs and issues my students had, no matter how happy or unhappy they were, for example, that I had to make my teaching experience work for ME, above an beyond anyone else. I had to make sure that my needs were met, if anyone was to be truly happy and benefit from my teaching. To that end, Mr. Osewalt always pointed out that the best thing to do at any particular time, was to take a day off.
As stressful and hectic as trading can be, teaching is as well, in its own way; and with all the time that teachers get off during the year, but with how modest their incomes are, if both were doubled, it would be well-deserved. Regardless, we all need a day off from time to time. Sometimes we need a few days off, if only for ourselves. There are countless books on trading and trading startegies, written by top traders, each of whom describe trading behaviors and strategies that have worked for them and believe can help you to become successful. Believe me, I have read plenty of them. And, as unique as each of these books can be, they all include at least something about taking a break from work. After all, you are the most important person! Mr. Osewalt will tell you that and so will all of the trading "gurus". They all know that you need to take some time off for your own well-being and peace of mind, whether it be to take care of other responsibilities so they do not weigh on your mind, or to sit on the couch all day and catch up on all the television shows you had to DVR because you did not have time to watch them when they originally aired.
Jessie Livermore knew what an important person he was and always made sure he had the opportunities to attend to his personal tastes, interests, and desires. We all have a little Jessie Livermore inside us because we are at the same time drawn to the markets and dazzled by it, as we see it as a means to satisfying our own personal tastes, interests, and desires. However, in a society and a culture where each person is important in his or her own way, we must never forget to take time to thoroughly and completely enjoy those things that are most important to us, from time to time, in spite of whatever else might be happening, even as it relates to trading.
