Becoming A Broker

This is a composite story and should not be taken 100% literally. Names have been changed.

I first started trading in 1991. I had been a successful stock trader and felt that I would like to take advantage of the increased leverage available to futures traders. So I opened an account and started trading. I was day-trading the S&P and was immediately successful. For about 2 weeks. Then, feeling invincible, feeling I could do no wrong, I got whacked for a $11,200. loss in one day. Oh, the anguish! After that, trading was a series of false starts, promising ideas, and disappointments. But I never gave up. Finally, slowly the tide turned. I became a break-even trader - then a profitable trader and then more and more consistent. I also learned that it is impossible to "know it all". To this day I attempt to make my trading even more consistent, with lower drawdowns and shorter "flat" periods. It is an ongoing challenge.

After a period of time, and after having determined for myself what it took to be successful, I gave some thought to becoming a Commodity Trading Advisor (CTA). A friend of mine made the suggestion that I become a broker first, as an intermediate step, to familiarize myself with the process of working with clients, filling their needs, answering questions , etc. It seemed like an excellent idea, so I got my license and got a job as a broker. The firm arranged for me to spend some time with their top broker. Let's call him "Mr. D". I was so excited! Was he a technician? A fundamentalist? What indicators did he use? Had he devised his own or adapted the ideas of others? I couldn't wait to see how he marked up his charts. With great anticipation I walked into his office. He immediately tells me, "When it comes to trading, I don't know my a** from my elbow". He told me the idea was to get on the phone, stay on the phone, and bring in the business. What about the clients? "What about them? I'm an order taker. Most traders don't know how to use a pencil, let alone make money trading. I'm a chameleon. I find out what they want to hear, and that's what I tell them. Get them in the door!"

I had a big smile on my face. Surely he was kidding, right? What a sense of humor! Turns out he wasn't kidding. When I finally realized that he was serious I asked him what he would tell a client who asked a technical question. "If they know even less than I do, I make up an answer, otherwise I change the subject, or put them on hold for a while until they forget the question." I was never so disheartened in my life. Even the day I lost over 11K wasn't as disappointing as this.

But, like my trading, I refused to give up. No firm has ever dictated how I deal with my clients. Though there have been subtle reminders that money is made on the phone and not by looking at charts, I have never been forced to treat my clients in any other way then the way I believe is right. And I have been able to build my reputation on service and genuine assistance and have become a successful broker too. It's a great job. I love it and will never do anything else, and will never ever lower my standards even though, in the words of the immortal "Mr. D", "there are a lot more brokers like me out there than there are like you."

Mr. D., I'm counting on it!