Market Operations Books

Some books on market operations:

Baker, Robert P. The Trade Lifecycle: Behind the Scenes of the Trading Process 2nd Ed (2005).

Dickinson, Keith. Financial Markets Operations Management (2015).

Loader, David. Clearing, Settlement and Custody 2nd Edition (2013).

Loader, David. Clearing, Settlement and Custody 3rd Edition (2019).

Simmons, Michael. Securities Operations: A Guide to Trade and Position Management (2002).

Simmons, Michael and Dalgleish, Elaine. Corporate Actions: A Guide to Securities Event Management (2006).

Weiss, David M. After the Trade Is Made, Revised Ed.: Processing Securities Transactions (2006).

Quotes

Some interesting quotes:

• Day by day, what you choose, what you think, and what you do, is who you become - Heraclitus
• I am not what happened to me. I am who I choose to become - Carl Jung
• When you are alone, mind your thoughts. When you are with friends, mind your tongue. When you are angry, mind your temper. Whn you are with a group, mind your behaviour. When you are in trouble, mind your emotions. When God blesses you, mind your ego.
• The opinion of 10,000 men is of no value if none of them know anything about the subject. - Marcus Aurelius.
• Discussions are always better than arguments, because an argument is to find out who is right, and a discussion is to find out what is right - Morgan Freeman?

Invert the Problem

One of  things Charlie Munger is well-known for is his principle to 'always invert'. Was trying to understand what this technique was about. He has some good YouTube videos explaining how he uses it.

As far as I can tell, it works something like this.  If you wanted to figure out how to ensure your project ends up successful, you should invert that problem and ask, how can you make the project fail? If the project fails, then it cannot be successful. If somehow you can prevent it from failing, then you have increased the chance of making it successful. 

Understand the causes of failure, and then prevent them and avoid doing them.  In addition to how you can make the project fail, think about what else can make the project fail, and then plan against them. The latter is more risk management though.

How to Arrive at the Perfect Solution to Any Problem

If your solution does not fix the problem, you have two options: 

1. Revise the solution so it fits the problem. 
2. Revise the problem so it fits the solution. 

 Option 2 is more cost-effective from a solution perspective.

The Children and the Donuts

Researchers placed young children in a room and gave each of them a doughnut, and a promise:" We'll be back in 30 minutes. If you don't eat your donut, we'll give you another donut." The researchers observed the children and followed their life for the next 40 years.

Some children didn't touch their donut, and waited for the researchers to come back. They led safe lives with moderate success.

Some children ate their donuts before the researchers even finished explaining. They became visionaries who refused to be bound by rules. Some became criminals.

Some children ate their donuts after 15 minutes of waiting.  They led happy lives.

Some children offered to buy other kids donuts. They became consumers.

Some offered their donuts to other kids. They became social workers.

Some children sold their donut to other kids. They became small business entrepreneurs.

Some children ate other children's donuts but not their own. They became politicians.

Some children took donuts from those who didn't want donuts and gave them to those who really wanted the donuts. They became socialists.

Some children sold their donut to other kids, and argued with the researchers that they are still entitled to another donut since they literally didn't eat their donuts. They became defense lawyers.

Some children bought donuts from other kids, and argued that *they* are the ones entitled to the future donuts, since the future donuts are contingent on who owned the donuts. They became derivatives traders.

Some children observed the researchers and tried to figure out what they were researching. They became sociologists and joined the team of researchers for the next 40 years.

Some children analysed their donut instead of eating them. They became scientists.

Some children ate their donut and claimed another child ate it. They also became politicians.

Some children wrote about the event. They became writers.

Some children forgot about eating the donut and wondered why the hole made donuts more fun. They becme philosophers.

PDCA Shouldn't Always Lead to Improvement

 PDCA (Plan, Do, Check, Act), and its alternative PDSA (Plan, Do, Study, Act), are popular quality improvement frameworks. The truth is, they shouldn't always lead to improvement. If every single PDCA cycle you implement leads to improvement, I'd suggest you take a deeper look. Maybe you're not doing PDCA properly.

Briefly, PDCA is about the following 4 steps:

• P - Plan an improvement experiment. Plan how to test if this proposed improvement really brings about an improvement.
• D - Do the experiment.
• C - Check / Study the results of the experiment.
• A - Act on the results of the study. Implement the change or perform another cycle. 

The 3rd step in PDCA, Check, requires you to check the results of what you did in the 'Do' step. The output of performing Check can result in one of the following conclusions:

•  The proposed improvement works, let's implement it.
• The proposed improvement actually makes things worse, let's not implement it.
• The proposed improvement is not an improvement, or not enough of an improvement, let's not implement it.

The point of C (or S) is to serve as a control gate so we don't implement changes that are not worthwhile improvements.

Problem Solving

So many different techniques being peddled on how to solve problems.

How did we get so prolific at creating problems without any training at all?

Often, people don't go about creating problems for others, but merely solving their own problems. Their solution inadvertently creates problems for others (and sometimes for the person who came up with the solution as well).

So, if a persons has the problem of failing business revenues and solves that problem by coming up with new products, then the other businesses may experience loss of revenue and all the problems that bring.