Lecture Notes: Words of Wisdom Podcast with Lewis Borsellino

Introduction

• Guest: Lewis Borsellino, a 40-year plus trading veteran.
• Background: Once responsible for 10% of the S&P volume in trading pits.
• Initial Career Interest: Originally planned to go to law school.

Early Career Path

• Turning Point: Father was murdered two days after college graduation.
• Transition to Trading: Inspired by reading about gold futures in The Wall Street Journal.
• Influence: Mother's association with top gold authorities, Mory Kravitz and Leo Melamed.
• First Job in Trading: Started as a runner on the floor of the Chicago Mercantile Exchange (CME).

Trading Environment and Career

• Experience in Pits: Describes the chaotic yet organized environment of trading pits.
• Initial Struggles: Considered quitting due to early financial losses.
• Key Breakthrough: Profited significantly during the Falklands War crisis, leading to a successful trading career.
• Role as a Broker: Executed orders for major firms like Goldman Sachs and Merrill Lynch.

Trading Philosophy and Insights

• Discipline and Mindset: Stress on the importance of discipline, handling emotions, and learning from losses.
• Lessons from Early Life: Early exposure to adversity helped in developing a mindset suitable for trading.
• Approach to Trading: Emphasizes the need for a plan and sticking to it, with controlled risk management.

Key Trading Anecdotes

• The 1987 Market Crash: Made $1.5 million in seconds by capitalizing on market volatility.
• Mistakes and Learning: Shares insights on the importance of being prepared and the unpredictability of markets.
• Emotional Control: Highlights the need to manage stress and emotions in high-stakes trading.

Transition and Adaptation

• Shift to Electronic Trading: Discusses the impact of electronic trading on floor trading.
• Preparation for Change: Started new ventures recognizing the shift to electronic markets.
• Business Ventures: Successfully transitioned into healthcare and cybersecurity businesses.

Reflections on Trading and Success

• Process Over Money: Focused on the process of trading rather than the monetary outcome.
• Maintaining Balance: Importance of family and personal discipline to avoid pitfalls.
• Advice to Traders: Stresses the importance of finding volatile markets to trade and the role of discipline and persistence.

Conclusion

• Legacy and Influence: Reflects on the unique challenges and experiences of trading.
• Final Advice: Encourages traders to focus on process, discipline, and being adaptable to market changes.