"If you stand on the right starting point and know the corresponding cycle of history repeating itself, then predicting 100 years or even 1000 years will be as simple as predicting 1 or 2 years. What has been, will happen again; There is nothing new under the sun." -Gann
Known as "the most famous investment theorist of the twentieth century" and mysterious trader, William Delbert Gann is famous for his "Gann Theory" (aka "Gann Theory") and for earning $50 million . In addition to being a trader, he is also a financial astrologer, and he spent almost the rest of his life selling financial astrology courses for a living.
01 Gann's early life
Gann was born in Lufkin, Texas, USA in 1878. The family lives by growing cotton. He is the eldest son of this poor family, and there are 10 younger siblings under him. He did not go to school because of the need to help on the farm. All his education came from reading the Bible in the cotton warehouse, and from the Bible he was introduced to futures trading. Later, Gann worked at a brokerage firm in Texas and attended business school at night.
It was a difficult time. Who knew that the poor kid on the farm would one day shine in Wall Street, the mecca of American finance, and become an immortal legend in the American stock and futures trading markets in the 20th century. And who would have known that his technical analysis theory and the magical calculation tool he created by himself could be spread for a hundred years and last for a long time!
02 Earned more than $50 million from trading
The world at the beginning of the 20th century was the era when Gann was active. He went through World War I, the stock market crash in 1929, the famous Great Depression in the 1930s, and World War II. During these long years of turmoil, disorder and economic disarray, he is said to have made more than $50 million in profits.
Gann started working on trains at the age of 16, and later entered a cotton trading house as a broker. At the age of 24, Gann made his first cotton futures contract and made a profit from it. In the following 53 years, he obtained a total of 50 million US dollars in profits from the financial market, which is equivalent to 1 billion US dollars today.
According to statistics, in 1909, Gann's trading skills began to attract attention. In 286 transactions, he only lost 22 times, and the success rate was as high as 92.3%.
It was amazing that Gann earned more than 50 million US dollars in that era. However, upon further study, it seems that Gann returned all the profits to the stock market in the later period, and then made a living by writing, selling books, and teaching to support his wife and children. His "cheat father" son.
03Newsletters, books and courses
In 1919, Gann published a daily trading newsletter, The Supply and Demand Letter, which covered futures, commodities, and annual forecasts. In 1923, he published another newsletter, "Services for the Busy Man," in which he gave readers detailed trading advice. In addition, Gann also published many books during his life, such as "Time Tunnel-Review from 1940" and "45 Years of Wall Street". Later in his career, he also sold a "master course" for $5,000 ($50,000 today).
04 supported voices
As a master trader, Gann's most notable event was a field visit by Richard D. Wyckoff, editor of the American magazine "The Ticker and Investment Digest" in October 1909. Under the supervision of the staff of the magazine, Gann made a total of 286 transactions in 25 market trading days in October, resulting in 264 profits, with a profit rate of 92.3%.
05 voice of doubt
On the other hand, Alexander Aird made a skeptical point of view in his book "Trading for a Living" in 1933, which has since been often cited by Gann skeptics. "Many opportunists sell Gann's influence, such as Gann courses, Gann software, they claim that Gann is one of the best traders in the world, and his estate has 50 million US dollars. However, I interviewed Gann's Son John L. Gann, an analyst at the Bank of Boston. I learned from him that his famous father was not able to make a living by trading at all, and could only write some teaching materials to support his family." John said that his father At the time of his death, all assets, including real estate, were only slightly more than one hundred thousand US dollars. Looking at it this way, William Gann's status as a master trader is nothing more than a gimmick created by book sellers and others who want to profit from him to deceive consumers.
However, supporters also pointed out that to look at what John said dialectically, you must know that John had a big fight with his father, and the two ended up not communicating with each other.
While the jury is still out on the magnitude of Gann's trading accomplishments, one thing is clear: traders have always been interested in Gann's history and experience, exaggerated or not. Because in the financial market, there will always be someone who wants to find a trading technique or a trading expert so that they can find some laws in the chaotic price fluctuations.
Gann's 21 trading rules
It is undeniable that Gann's theory is still popular among many traders, among which "Gann's 21 trading rules" are regarded as trading secrets.
Divide the funds into 10 equal parts, and limit the risk of each transaction to less than one-tenth of the total funds.
When placing a trade, be sure to set a stop loss.
Do not buy or sell excessively and avoid violating the rules regarding capital volume.
Never turn a position from profit to loss, and adjust the stop loss price when the profit is increased.
Don't go against the trend. If you cannot judge the market trend, you should wait and see from the sidelines.
If in doubt, you should close your position and leave the market. Don't enter the market when you are indecisive.
Only trade in active markets. Stay away when the business is light.
Only obey the market trend, follow the trend, enter and exit the market without setting a target price-no hope or fantasy.
If there is no proper reason not to close the position, the stop loss position can be adjusted to protect the profit obtained.
After winning the battle, part of the profit can be withdrawn or transferred to another account for urgent needs.
Don't just buy or sell for dividends or spreads.
When losing money, avoid gamblers' overweight in order to spread the loss evenly. This is the biggest mistake a trader may make.
Don't close out because you're impatient, and don't get in because you're impatient.
Don't suffer big losses because of greed for small profits, and don't do business that loses more and earns less.
Set a stop loss when entering the market, and it should not be canceled at will.
Buying and selling should not be too frequent, do more and make more mistakes, wait for the opportunity to enter the market again.
If you are willing to go long, you should also be willing to go short, and you should be able to buy and sell freely.
Don't buy because the price is too low, and don't go short because the price is too high.
Never hedge. If you are long and face a decline, don't sell to cover your position. You should leave the market and admit your compensation.
Don't carry out pyramid overweight trading at inappropriate times, and wait for a breakthrough or drop below a key level to increase your overweight.
Don't change your trading strategy for no reason, and don't leave the market before there is a clear turn in the market.
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