His theories mostly related to psychology aspects and fundamentals values. Most of the novice investors dislike the terms "speculation" or "speculators". These words carry a bias of negative in their mindset, they prefer hearing "value investing" which is best to describe Warren Buffet.
Whether Buffet or Soros, both of them have one common in their investment priciples. They tend to discover the undiscovered truth before others. I would like to touch on Soros in this article.
As an active participant in FX market, I realise what he wrote is true especially in day trading. Most of my day trading is based on intuition and instinct, I tend to place an order before knowing the reasons behind it. I admit I am not a good day trader and do better in swing trading. However, I will exist the trade as soon as I feel uncomfortable about it. My exist can be profitable or incur losses.
The second element is speculations on the currency movement in long term. Soros admitted he is not good in catching the reversal points which most of the traders failed including me. I have a good friend from Bank of Mitsubishi Tokyo in Singapore who act as my adviser in yen trading. I was told yen will appreciate until 85 (which is a shocking figure to me). He is a pure fundamentalist and have some market information. I made a mistake by hedge it at 95, I set the the trigger at 90, I always provide margin of safety since my fund is limited. While I am writing this article, yen is heading back to 95. It reached 91.87. Catching bottom and reversal making me in doubt now. I rewrite my rules now; never predict the bottom and tops. As a conclusion, I contend speculation is business, not gambling.
