Editor’s note: Last week, we left you with Larry’s unique take on the “time value of money,” and how it’s brought him success in his trading career.
Today we look at another core of Larry Benedict’s trading approach – what he calls “The Will to Win” – and how it influences his unusual sleeping habits.
Daina Schnese: Recently you told me you were “up all night trading.” I have to ask, is this common for you?
Larry Benedict: Oh yeah, that… [laughs]. Well, it honestly depends on the opportunities I see on any given night. I don’t just stay up because I can’t sleep or I have the need to trade all the time. It’s opportunity driven.
Daina: What kind of opportunities are you talking about?
Larry: A lot of big opportunities happen overseas in Europe. So, depending on how busy the night is, you’re going to see bigger movements out of Europe and even Asia. And the various European exchanges don’t open until around 3 A.M. ET, so it makes for a pretty long night if you’re up for trading.
I’m mostly looking to trade our U.S. exchange versus those exchanges. I can also trade the euro or the currencies in those countries. But, generally I’m trading the European indexes against our index.
And I watch those markets every day, because they make our market move. We’re trading a little bit of Europe and Asia, but mostly trading our markets in the U.S. because they move a lot off of those markets around 2 or 3 A.M.
That’s why it’s sometimes important for me to be awake and trading at those hours. It’s so I can pay attention to what’s happening and causing our markets to move. I don’t do it often, but when I see a setup that I really like, that’s when I’ll forego sleep.
Daina: Why is it important to pay attention to global markets?
Larry: It’s very important to pay attention to inter-market interrelationships. Like I said, global markets make our markets in the U.S. move. They can also influence our policies and have their own policies you want to pay attention to. Sometimes, you’re dealing with a lot of noise… and that influences our market… especially on the opening.
For the new trader, there’s no need to focus on trading other exchanges. It’s just important to pay attention to inter-market relationships to help you become a better trader in the U.S. You start to find correlations and see how different news and policies impact our markets.
Daina: Do you know a lot of skilled traders who stay up late for those opportunities?
Larry: Believe it or not, a lot of big traders I know will get up for the day before 3 A.M. They’ll trade all through the night, until the market opens here (around 9:30 A.M.), and then call it a night. So, there’s money to be made there and people are willing to craft their lives around that money.
It’s kind of like being a professional poker player in Las Vegas. They sleep during the day and work during the night. These traders make really good money… but, of course, the hours are brutal.
But personally, I don’t mind staying up late if it means I get to capitalize on a big trading opportunity. It’s just the way I’m programmed. I’m always looking to win. But I’m not going to do it every night. I can make the same profits during the day.
Daina: In terms of always looking to win… Are you that way in general? Or is it just with trading?
Larry: I am ultra-competitive. So, it comes from a place of always wanting to be the winner at anything I do. I even have to hold myself back when I play pickleball with my son. But I was that way even as a kid!
There’s actually a funny story about that… My brother and I used to play baseball together all the time. And I’d get so mad when I’d lose, I would take one of the bases home with me. That way, the game was over. I would just get so mad. And even when he thought he could beat me at something, he wouldn’t… because he thought he would break me as a person.
I was that sore of a loser. But, it was more that I was so insanely competitive. When stuff isn’t going my way, or we’re having a bad trading day, I have been known to throw phones across the room… or anything I can get my hands on… and even curse at anyone near me. I’ve gotten better with those things as I’ve gotten older, though. I just don’t have that same aggression… it’s hard to stay at that level of intensity once you age.
But, if you want to play the game of trading, you have to be competitive. You have to want to win more than anyone else in the room. And that’s how I’ve always been. That’s the place it comes from.
While it’s caused me to do things like throw phones, it’s also allowed me to become the successful trader I am today. I will do whatever it takes to put a P [profit] on the page… even if that means sitting on the sidelines to wait for a better trade to come along.
It’s like an athlete’s mentality. I was the guy on the basketball court who wanted the ball
because I wanted to take the last shot. I wanted to be the one who won the game for the team. I just have the will to win.
Daina: Well, I’d be interested to hear more about what a typical trading day is like for you. Let’s focus on that next time we are together. Talk to you soon, Larry.
Larry: Great, sounds good.
About Larry Benedict
Larry is a former hedge fund manager with over 30 years of investing experience. He’s also known as one of the world’s best traders… and for good reason.
From 1990 to 2010 – when he was actively running hedge funds – Larry never had a single losing year.
Larry’s market commentary is frequently featured in Bloomberg, Barron’s, and The Wall Street Journal, among other major news outlets.
Source: Opportunistictrader.com | Original Link