Q: What is the Fixed System?
A: The Fixed System is the application of economic law in a manner consistent with the scientific method to profit from price changes.
Q: What do you mean by scientific method?
A: Using observation to establish facts and then logic to reach useful conclusions that follow from the factually correct premises.
Q: What do you mean by economic law?
A: A useful description of human action related to economic activity. See Human Action by Ludwig von Mises and Man, Economy, and State by Murray Rothbard.
Q: Where do I begin if I want information about how to apply economic law?
A: Start with The Art of Speculation during Civil War — Sun Tzu Meets Jesse Livermore.
Q: These three books amount to over 2,000 pages and the material is sometimes difficult. Do I need to understand all of it before I can use the Fixed System?
A: No, but you’ll get better results if you do.
Q: What do you consider a good rate of return?
A: A good rate of return in a year is 50%.
Q: For a speculator, what would be an extraordinary return if leverage and compounding were applied?
A: Let’s use options on gold shares as an example. The shares are three times more volatile as the bullion and on the options you can get five-to-one leverage. Three times five is fifteen. Further, if you properly compound at say every five percent movement in the bullion price, you get another 3 times increase so the result is forty times better than your speculation. Anything over a twenty-five fold increase within a year counts as an extraordinary speculation success.
Q: What is the best result you’ve ever had within a one-year period speculating in the gold market?
A: A 550 times increase on 10K to 5.5m.
by Arthur Fixed
[box type=”info” style=”rounded” border=”full”]Commentary from Arthur Fixed the author of the Art of Speculation during Civil War – Sun Tzu Meets Jesse Livermore is a private manuscript copyrighted 2012 by Art Fixed.[/box]
Photo credit: listentothemountains via Visual Hunt / CC BY-NC-SA
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