|
Feature
 E-Mini
Futures � Leveraged, Liquid and Easy to Love
by
D.R. Barton
Having
just made the 14 hour flight from Sydney, Australia to San Francisco,
I was decompressing in the local airline lounge before another 5+
hour flight back home to the East Coast.
Then,
I heard a booming voice coming from one of the business cubicles
next to me. The voice
was so unmistakable, he might have well been saying one of his
famous catch phrases like, �Back-back-back-back�� or spouting
one of his wry nicknames like Andre �Bad Moon� Rison or Jake
"Daylight Come and You Gotta" Delhomme.
It
was world renowned sportscaster Chris Berman, who through knowledge,
hard work, humor and sheer force of personality has become the face
(and voice) of the ESPN sports network.
I
just couldn't pass up saying hello to someone who has entertained
and informed me and countless others through the years.
He was as affable in person as on screen.
He asked about my travels and told me he was heading back
home. It was time to
catch his flight and he took off.
Then
20 seconds later he came around the corner and said, �If my Dad
were here, he would want me to do a proper introduction.�
He asked my name and then chatted about the Pebble Beach Pro
Am where he was just participating in the tournament.
He even agreed to a picture, which I said was for my son (but
we both knew was for me�). And
he even graciously overlooked a conversational faux pas on my part.
It�s
hard to know too much about a person from a brief description, but I
hope you have gained some added insight and appreciation for this
Ivy League educated star who is the best known sports caster in
America.
To
be honest, it�s easy to see how a man like this can rise to the
top and stay there. He�s
genuine, caring and really knows his stuff.
This
brings me to a guy who shares many parallels with Mr. Berman.
Another
Ivy Leaguer � This One a Market Maven
Just
after my conversation with Chris Berman, my mind leapt to another
Chris�this one, my good friend and business partner Christopher
Castroviejo. Christopher
has many of those characteristics that I had just admired about
Chris Berman�a caring guy who is genuine and truly knows HIS
stuff. A 37 year Wall
Street veteran, he�s really the pro�s pro when it comes to
trading.
I
want to tell you a bit more about Christopher and his background
because it�s a very interesting story.
Then we'll find out his current take on the market conditions
and trading the index E-Minis intraday.
A Market Maven in Every Sense of the Word
I�ve
had the pleasure of trading with many different professional
traders. Christopher
Castroviejo is at the top of that heap, but
that experience didn�t come overnight.
As
I mentioned earlier, Christopher has spent 37 years in and around
the markets. His resume
and track record on Wall Street became something of legend: stints
with Smith Barney, J.P. Morgan, a partnership at Bear Stearns,
financial consultant for The Vatican Bank to name a few. Christopher
was hot and getting hotter. Some highlights include turning $10,000
into $178,000 in four weeks, 8 straight years of 43%
compounded profits as a top hedge fund manager, a sleek Manhattan
brownstone and a spacious summer getaway in the tony Hamptons.
Christopher even struck up a friendship with his money making
idol, billionaire George Soros (to be honest, the people Christopher
has worked with in the field is a veritable �who�s who� of
Wall Street elite).
Along
with multi-million dollar wins, there were a few huge losses; in
just six short weeks, $10,000 became a cool million, and quickly
nothing but air. And, in one monumental transaction gone wrong,
Christopher lost $15 million dollars in just a few months�$1.5
million of it his own money. But, unlike the Vegas poker player who
can�t leave the table, Christopher learned from the missteps as
well as the wins. �You have to reinvent your performance all the
time. I used to see the business as just about orchestrating wins,
but the rational way of thinking about it is really about
controlling your losses.�
Anyone
who has read Jack Schwager�s Market Wizards series (the
first of which featured a chapter on Van) knows that many of those
top drawer players became the traders they are by learning lessons
in their own personal �trials by fire.�
Christopher has certainly been through his own version!
Today,
Christopher is an active intraday and swing trader and he continues
to manage money for a select list of Wall Street insiders.
I
have learned so much while trading, working, teaching, and managing
money with Christopher. So
I asked him to share a few insights with us.
What
are your thoughts on current market and trading conditions?
There
is a preponderance of government announcements and programs (and
announcements about programs!) these days.
People anticipate help, run prices up, and then we get a
short term top when reality sets in.
January 28th was a great example of this.
The key thing to trading the �hard right edge� of the
chart is to understand where you are relative to the recent
history of the price movement.
If you have a road map of where you�ve been, it's much
easier to react to where you are in the moment.
You�re
a big fan of multiple time frames.
How can traders use that concept intraday?
I
look at the markets in terms of finding key decision points.
Using multiple time frames helps me to make better
decisions. I can trade
against a short term move or trend if I know that there are key
points on a larger time frame that indicate a high probability for
a change in direction. It�s
like fading a small ripple during a change in the tide.
Once or twice a week, we get set-ups for really great
trades on the 5 minute time frame by understanding what�s going
on in a 60 minute chart.
You
watch the market internals closely during the day.
Tell us a little about that.
I
think that it�s very important to understand the market�s
language. The market
internals, indicators like Tick, Trin, Put/Call Ratio and the
Advance/Decline line, give us a good understanding of the
market�s sentiment. While
skillful traders can capture short term moves that go against the
market internals, there are times when internals can tell you that
trades against them don�t stand a chance.
What
one or two key concepts have you found that separate top traders
from the rest?
Two
things stand out to me. The
first is the ability to act decisively in the face of discomfort
(or fear). The second
key characteristic is focus. Being
able to filter out all of the market noise and focus on the one or
two key things that matter at any given time.
Of course, those key things change from time-to-time, and
that�s where the experienced trader uses his skill to determine
where to concentrate her or his effort.
Christopher
is a master at several aspects of intraday trading and is
particularly skilled in the application of key level
support/resistance and Market Profile.
About
D.R. Barton: A passion for the systematic
approach to the markets and lifelong love of teaching and
learning have propelled D.R. Barton, Jr. to the top of the
investment and trading arena. He is a regularly
featured guest on both Report
on Business TV, and
WTOP News Radio in Washington, D.C., and has been a guest
on Bloomberg Radio. His
articles have appeared on SmartMoney.com and Financial
Advisor magazine. You may contact D.R. at
�drbarton� at �iitm.com�.
|
DEFINITIVE GUIDE TO POSITION SIZING
