Learning How to Lose

Published on
August 9th, 2019
Duration
48 minutes

Learning How to Lose

The Interview ·
Featuring Mark Ritchie and Mark Ritchie II

Published on: August 9th, 2019 • Duration: 48 minutes

In this candid interview, investor and “Market Wizard” Mark Ritchie is interviewed by his son Mark Ritchie II, CIO of RTM Capital Advisors. They delve into Ritchie’s life and career in the pits of Chicago, and discuss how original thinking led him to success. The conversation reveals wisdom on how to manage risk, mitigate losses, and make sense of how the world works as an investor. Filmed on July 30, 2019 in New York.

Comments

Transcript

  • TJ
    Terry J.
    19 August 2019 @ 22:26
    What a legend! I love Mark's practical philanthropic views and Christian values! Give a man or woman a fish and they will eat for the day. Lend him or her the money to buy a fishing rod and they can become self sufficient and economically productive! Mark II also played an invaluable role in making this video both extremely instructive and wonderfully entertaining. Another classic Real Vision master class.
  • BW
    Bill W.
    16 August 2019 @ 22:29
    Zervos like "bonds and stocks" aka risk parity trade BUT never mentioned GOLD. Hmmm!
  • AJ
    Andy J.
    16 August 2019 @ 18:52
    Wonderful content, informative and fun. Love this Also love how "Ritchie the Lesser" would pull back on his Dad... reminds me of my Dad, as well. Maybe consider finding other father/son trader combos and doing similar for next Father's Day? :)
  • LT
    Luman T.
    15 August 2019 @ 00:35
    "Greed is answered by generosity. Poverty is answered by productivity." One insightful perspective among many in an interview that challenged me to think. Also, Mr. Ritchie the Elder is dressed like a boss. Incredible boots.
  • MW
    Marcus W.
    14 August 2019 @ 15:42
    So good to hear about losses and losing. This has kept it real for me and I've double checked my strategy appropriately. Managing risk and sizing appropriately, is just not discussed enough. Brilliant
  • FK
    Firoze K.
    14 August 2019 @ 07:34
    Thoroughly enjoyed this interview, thank you!
  • MG
    Miguel G.
    13 August 2019 @ 16:31
    What a beautiful mind you have Mr. Ritchie, bless your soul. We need more people like you in this world and this 48 min interview has really made me question some things in my personal life. Keeping an open mind and dare to think differently. Would be a gift to have you on again. Thank you for sharing some of the wisdom that you have learned throughout your life.
  • TS
    THEODOROS S.
    12 August 2019 @ 21:39
    8
  • Nv
    Nick v.
    12 August 2019 @ 11:53
    What a treat. Loved it
  • VE
    Viktor E.
    12 August 2019 @ 10:01
    Fantastic, we need more people like this in the world
  • RK
    Ron K.
    12 August 2019 @ 06:43
    Your father is a real gem, the respect you have for each other also shows.
  • JW
    Joe W.
    12 August 2019 @ 05:36
    Love it. Really eye opening from Senior Richie's view on current political and economic issues.
  • JH
    Johannes H.
    11 August 2019 @ 22:44
    Finally another classic from Market Wizards! Those interviews are the best by far, that is about actual trading and not the aggressive macro guys like Kyle Bass(nothing against the man, just an example) that hates China and whatever.
  • MF
    Marc F.
    11 August 2019 @ 19:24
    That is one one the best interviews on real vision. Really enjoyed this conversation between the both family members. Please give us a second interview soon!
  • BE
    Baha E.
    11 August 2019 @ 19:20
    Jason Statham's father is a great trader.
  • CS
    CMC S.
    11 August 2019 @ 09:27
    Excellent Piece. A pragmatist with great insights. Seems like there was more that he wanted to say. Can we have a follow on interview?
  • MS
    Mark S.
    11 August 2019 @ 03:13
    Very creative topics and excellent interview. Ended up buying both of Mark's books.
  • TW
    Tom W.
    10 August 2019 @ 21:23
    Did I miss the lesson on taking losses? A lot of anecdotes, but didn’t share the strategy or tactics of how to take losses. The micro loan topic was interesting. Bentley University sponsors a Micro Lending business that students run. They learn real life finance lessons there.
    • fT
      forecast T.
      11 August 2019 @ 06:01
      Think of it as burn rate or the loss you take on a spread but big picture. Write calls at a market top , for example , and buy back the option at a lower price means you’re losing long value but gaining option premium so there’s a “loss” to make (hopefully) more off the contract than you lost holding.
  • LJ
    Liam J.
    10 August 2019 @ 18:22
    The law of averages really hit me damn. i've been a speculative trader for about 3 years now. A few months ago I went on a crazy crazy winning streak. I went from having 20k to having 190k in the span of about 2 - 3 months. In my head I was already starting to dream about the millions i would have. (did this by going leveraged long and short on bitcoin and ether). Now i've lost all those winnings and I feel like a complete dumbass. The worst part about it is i would've been sooo much better of if i just kept my trade of the end of march open and didn't touch it. No i didn't get greedy and longed at the top or something like that. it's the chops in price that killed me. Now i'm at that point wondering where it al went wrong. It really was like he said, everytime i bought it went up. Everytime i sold it went down. at some point I stopped being right and before I knew it I was worse off than where i started.
    • RM
      Russell M.
      13 August 2019 @ 02:28
      You juggle grenades, ... Bitcoin on leverage. What did you think was going to happen? Now the life lesson. Can you learn from your mistake and make rational offense without blowing yourself up? Might take a while before you know.
  • FC
    Fractal C.
    10 August 2019 @ 16:16
    This was absolutely brilliant. Thank you Mark & Mark! "Think Opposite" and "Learn to be a Professional Loser". Wow!
  • DP
    D P.
    10 August 2019 @ 15:12
    Great character and a gentleman! I really enjoyed this. All the best to your family and thanks for sharing this with us.
  • JF
    Jarrod F.
    10 August 2019 @ 12:15
    The neoliberal agenda has been an abject societal disaster, in spite of its very aim of trying to 'make people richer'. The results of this failed endeavour are bearing fruits the world over, as populist governments seize power to appease desperate working poor populations. At least the working poor in industrialised nations outside of the US have a decent social safety net and health systems to fall back on. The fullstop on this era is surely Donald Trump. The logical start to the next chapter is a return to more progressive taxation system akin to the 'golden age' period from the post war to early '70s, a period typified by more stable economic growth and broader economic wealth share.
    • TR
      Travis R.
      10 August 2019 @ 22:04
      I disagree that progressive taxation would solve anything except for crushing the upper middle class. Taxes are a series of incentives. Less taxed activities are incentivized. Income taxes and property taxes are terrible ways to collect taxes. Punishing people for working or owning a home is not beneficial to society long term. I firmly believe the fairest tax system is a flat sales tax on everything excluding groceries and utility bills. Excluding groceries and utility bills allows the poor to pay zero taxes while they support their families and work towards a better future. A flat sales tax of say 10% would mean somebody buying a Rolls Royce would pay around $50k where somebody buying a used Honda Civic would pay around $1k. It is very fair, encourages work, investment, home ownership, etc. With everybody being taxed it makes the government accountable to the populace. Currently close to 45% of taxpayers pay zero in Federal Income Tax. These individuals are incentivized to vote for government transfer payments (welfare, food stamps, disability, etc) Also it eliminates 90% of the IRS where they just have to focus on businesses to ensure accurate taxation of revenue. Where does this reasoning err? RV viewers in my opinion are outstanding thinkers.
    • JF
      Jarrod F.
      11 August 2019 @ 01:15
      Travis, you can firmly believe what you like. But data shows countries with broader levels of wealth distribution (e.g. measure by gini coefficient) have more progressive tax policies and have happier populations. Note the high correlation between income equality and happiness https://en.wikipedia.org/wiki/List_of_countries_by_income_equality#OECD_countries https://en.wikipedia.org/wiki/World_Happiness_Report#2018_report
    • TR
      Travis R.
      11 August 2019 @ 04:02
      Take a few Statistics courses and you will discover that you can take almost any set of raw data and manipulate it to say anything you want. Studies and data sets are subject to the interpretation of the observer. Just like algorithms are a function of the parameters set by the programmer. The truth is that any type of system of taxation whose aim is to take from one set of people and give to another will ultimately lead to ruin. Your gripes are misguided; your ire should be with Fiat money, the Federal Reserve system, both of which do far more to drive income inequality then taxes.
    • JF
      Jarrod F.
      11 August 2019 @ 04:51
      All of those most-happy countries live in a fiat currency world too, so that argument doesn't hold. Of course, correlation doesn't mean causation, but it's at least statistically significant.
    • JJ
      Jacob J.
      13 August 2019 @ 04:38
      So then according to your theory a country with no wealth gap where everyone is broke should be #1 happiest?
    • JF
      Jarrod F.
      13 August 2019 @ 10:02
      No. A country whose population describes themselves as happy are happy. It just happens to be that the happiest countries also tend to have progressive tax systems. As Adam Smith said, "it is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion," and "no society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable."
  • MB
    Matt B.
    10 August 2019 @ 10:47
    Wow, CRT, used to trade with them a lot. Terrific guys whose good humour stands out in our tight-assed industry.
  • BM
    Beat M.
    10 August 2019 @ 09:33
    Liked it very much! I am a “X-er”, so probs to you for interviewing your “Silent” father, it’s usually not like a symbiotic “Boomer/Millenial” relationship. As for the topics: So we have to restrain ourselves when we speak the truth we perceive? I hope this will change in a not so distant future.
  • jl
    jay l.
    10 August 2019 @ 07:27
    we need more of this guy please.
  • HH
    HODL H.
    10 August 2019 @ 06:11
    The holy spirit spoke to me and said you should refuse all forms of social security and Medicare and not leave any inheritance to your children or grandchildren. Family should work for and earn the capital they get, let the poor and meek inherit all of your wealth good sir! 2nd Corinthians 8:13-15 13 Our desire is not that others might be relieved while you are hard pressed, but that there might be equality. 14 At the present time your plenty will supply what they need, so that in turn their plenty will supply what you need. The goal is equality, 15 as it is written: “The one who gathered much did not have too much, and the one who gathered little did not have too little. Acts 4:32-37 32 Now the whole group of those who believed were of one heart and soul, and no one claimed private ownership of any possessions, but everything they owned was held in common. 33 With great power the apostles gave their testimony to the resurrection of the Lord Jesus, and great grace was upon them all. 34 There was not a needy person among them, for as many as owned lands or houses sold them and brought the proceeds of what was sold. 35 They laid it at the apostles’ feet, and it was distributed to each as any had need. 36 There was a Levite, a native of Cyprus, Joseph, to whom the apostles gave the name Barnabas (which means “son of encouragement”). 37 He sold a field that belonged to him, then brought the money, and laid it at the apostles’ feet.
  • WB
    William B.
    10 August 2019 @ 04:17
    I loved the Market Wizards books. Now I got to listen and learn from an original. Just wow doesn’t cover what an amazing interview of an amazing man and his incredible son!!
  • BP
    Bryce P.
    10 August 2019 @ 03:20
    Phenomenal interview with Mark Sr. Enjoyed listening to his perspective. Very entertaining. Perhaps my favorite RV interview of all-time. Please have him back sooner rather than later w/Mark II. If more rich people had his value system then the world would probably be a better place. Unfortunately most of the time the rich rob, steal, cheat and exploit the poor. For example in America we absolute hate the poor. We hate them with a passion. In fact its the poor person or even that guy who's maybe in a union job trying to feed his family's fault on everything in America. How dare he/she try to make a living wage and have some scraps I mean benefits for his/her family. How dare they. These people are destroying America. We despise giving any poor person "welfare" or a "public handout" (I'm certainly not suggesting that's the solution either). However, poor and middle class Americans love billionaires and fall for their BS and never have issues giving them all kinds of free welfare in the forms of huge tax breaks for business or my personal favorite building stadiums/arenas at the taxpayer expense where the billionaire keeps all the profits. Billionaires LOVE free handouts and welfare. Ponder that one...... Before anyone accuse me of being a demopublican I am certainly not. Neither am I a republicrat. Sorry I don't play in that false paradigm .
    • PP
      Patrick P.
      11 August 2019 @ 02:00
      Bryce... Why ....do I think you watch this video with the sound off?
  • GF
    Gordon F.
    10 August 2019 @ 01:27
    This reminded me of an experience some 20 years ago when I participated in a church committee where we considered the needs of and how to help some of our needy members. One of the older men made a comment that has always stuck with me. He said, "Some problems really are just financial. They are easy to fix. You write a check and move on. But most problems are behavioral, and if we don't help our needy members face and deal with their behavioral problems, giving them money will just aggravate their situation." It is really hard to give away money - in the manner of Bill Gates - such that it really helps people. Bill Gates himself has commented on this. Too often, such philanthropy (a word Mark objected to) just winds up enriching and entrenching corrupt managers and/or politicians, and really does make the problem worse. And please don't take this as a criticism of Bill Gates. I think he does his best to use his wealth to improve the world, but with as much as he has, he has to delegate most of the real effort, and it is not easy. To do as Mark has done, to deal with individuals and to really get to understand the root of the issues, takes time, effort, and empathy, and I applaud him for it. Too bad that few if any of our politicians have made the same effort. They might then understand better the problems they propose to solve.
  • hz
    herbert z.
    10 August 2019 @ 01:17
    Absolutely Brilliant -
  • WS
    Will S.
    10 August 2019 @ 00:48
    Amazing interview. The Christian perspective on capitalism is priceless. It's really about opportunity, putting capital to work to TRY for productive venture and have compassion along the way. There's a reason why traditionally Christian nations are the wealthiest and are sought after by people around the world (for immigration). John Adams (American founding Father): "Our Constitution was made only for a moral and religious People. It is wholly inadequate to the government of any other."
  • DW
    Dean W.
    9 August 2019 @ 23:42
    That. Was. Awesome. RV keeps out doing itself. For those of you that gave it a thumbs down...seriously. open your mind.
  • AK
    Adam K.
    9 August 2019 @ 22:18
    This kind of shit is priceless. WELL DONE
  • GC
    Gerry C.
    9 August 2019 @ 21:02
    "Sizing is everything" >>> boom <<< 'nuff said. Great interview.
  • DA
    Dimitar A.
    9 August 2019 @ 20:49
    Amazing interview! Absolutely priceless wisdom. Listening to a guy who has been in this type of work for his entire life is what we need. Compared to him (not trying to downplay anyone) many of the other experts look like they are just short term lucky guys! Think about it, Mr. Ritchie Sr is a lifetime profitable trader. How many people can say that?
    • PP
      Patrick P.
      11 August 2019 @ 02:15
      Dimitar.... I have watched every video of every legend (expert) on Real Vision since it's inception....can't recall any "short term lucky guy's". Just saying.
  • SM
    Stephen M.
    9 August 2019 @ 20:35
    The one failure of the point of view (which we often call blind spots) is that much of the poorer areas of the world are both directly and indirectly poor due to the richer areas exploiting them for profits. We often in the richer world view the world through our narrow lens, oblivious to our own behaviours, actions and ways of doing society.
    • SM
      Stephen M.
      9 August 2019 @ 20:38
      Obviously that option is from a sociological perspective and not an investment perspective. Cannot give an investment perspective as relatively new to the area, but from an understanding of the social and society, the arguments fall flat pretty quickly.
    • MR
      Mark R.
      9 August 2019 @ 22:37
      This point is very well taken. It is fair to say that the poor are almost always exploited by the wealthy and powerful. Most dictators hoard all a wealth they can. It is a generalization, but a fair one, to say that a country's level of economic development is inversely related to its corruption and oppression of the poor.
    • JJ
      Jacob J.
      13 August 2019 @ 04:26
      That is a fair point, but it's more of a behavioral and societal problem than a financial problem. It's simply human nature to aim for the position that has the greatest advantage. And as more exploitative behavior is used it becomes easier for other members of society to justify doing the same. On the other hand, the difference between opportunity and exploitation can get blurry in the middle. Just look at the relationship between China and the US. They did lots of work for ultra low wages but we became their biggest customer and that has lifted the standard of living for the whole country. The two nations obviously have some serious problems internally and externally, but I think anyone would have a difficult time finding an example where exploitation and opportunity weren't somehow linked.
  • SS
    Sam S.
    9 August 2019 @ 19:25
    Friggin Loved It! Politics were perfectly spoken and placed in reality. In fact, all of this was reality on steroids. I would like to have heard more "trading" education, but got a great taste. Thank you Mark I & Mark II.
  • BD
    Brian D.
    9 August 2019 @ 18:14
    Absolutely fantastic - thanks to father and son! Just bought the book too!! Thanks, RV - more like this please and keep up the great work!
  • MS
    M S.
    9 August 2019 @ 18:09
    Very interesting
  • MC
    Minum C.
    9 August 2019 @ 16:11
    A refreshing splash of cold water on my face helps put everything into its proper perspective. Thank you.
  • BK
    Boris K.
    9 August 2019 @ 16:07
    I traded in the soybean pit of the CBOT for 20 years, just missed mark ritchie by a few years.. But he is spot on when he says its all about your losers, a trader i always respected once told me "you cant go broke taking a profit" .. so i always keep my stops tight
  • RM
    Richard M.
    9 August 2019 @ 16:03
    Really enjoyed this conversation. But will have to admit (and no disrespect to Mark Jr) would love to have had Grant Williams to have been the interviewer (much less interrupting of the guest and just let the guest go - especially if they are really interesting like Mark Sr is). Regardless, still really enjoyed this!
  • JF
    John F.
    9 August 2019 @ 15:44
    Bill Gates has definitely done more for the world than Mother Teresa (Anjezë Gonxhe Bojaxhiu). She was a charlatan and the fact that it is considered common knowledge to reference her as a beacon for humanity demonstrates how absurdly uninformed our species remains. As Christopher Hitchens put it: "She was not a friend of the poor. She was a friend of poverty." If this all seems insane to you, let me recommend that you research it yourself and consider reading Hitchens' book The Missionary Position.
    • DS
      David S.
      9 August 2019 @ 17:47
      One does not need to denigrate one person's efforts to praise another. If you were dying in poverty on the streets of Calcutta and were helped by Mother Teresa you might look at her less abstractly. DLS
    • PB
      Pier B.
      10 August 2019 @ 07:43
      I think if you did some research on Bill Gates you would find he is not the paragon of virtue that you think. Member of the "elite" who thinks that half the world population should be exterminated, just not him and his ilk.
  • MR
    Mitchell R.
    9 August 2019 @ 15:26
    Brilliant! One day I would like to have a similar conversation with my kids...
  • NO
    N O.
    9 August 2019 @ 15:22
    Outstanding
  • NA
    N A.
    9 August 2019 @ 15:14
    Loved the interview need more old timers with REAL world expeience.
  • SG
    Sven G.
    9 August 2019 @ 14:48
    another old school trader who is also a great storyteller... I wonder if there is some sort of correlation between the two skills. Thanks!
  • HK
    H K.
    9 August 2019 @ 14:34
    what an interview! could have listened for hours more
    • CJ
      Charles J.
      9 August 2019 @ 16:38
      I had the exact same thought. Very entertaining!
  • BS
    Bevyn S.
    9 August 2019 @ 13:41
    This guy is REAL and not afraid to speak his mind... Loved it.
  • JH
    Jesse H.
    9 August 2019 @ 13:37
    Excellent and thought-provoking, even if I respectfully disagree with many of the views expressed. I will consider the other side, however.
  • DL
    David L.
    9 August 2019 @ 12:29
    Terrific interview, both interesting and informative, thanks.
  • GK
    Giannis K.
    9 August 2019 @ 11:38
    f***ing legend
  • mp
    michael p.
    9 August 2019 @ 08:26
    Wow that story about microloans was ...I can't find the word, but I'm glad I heard it
  • RM
    Russell M.
    9 August 2019 @ 07:41
    Respect! Wisdom. One of the few who has a clue about the difficult things in this world.
  • cg
    christian g.
    9 August 2019 @ 06:53
    Love it ! “Think the opposite”!