The Art of The Trade by Jason Alan Jankovsky

Book Review - The Art of the Trade

If you ever wondered what the shady side of the futures industry looks like, then you will want to read The Art of the Trade by Jason Alan Jankovsky. The title of the book leads you to believe it deals with a floor trader and his struggles in the trading pits. However, Jankovsky was a commodity broker at some of the less than desirable commodity brokerage firms, many of which no longer exist.

Like many, Jankovsky wanted to become a commodity broker for the excitement of making huge profits trading the futures markets and building a career where he and his clients mutually benefited. The vision was an honorable one where hard work, intelligence and ethics would pay off handsomely. All he would have to do is follow in the footsteps of the masters who were known as commodity brokers. Well, it turns out that things were a little more complicated than that.

Unfortunately, Jankovsky started out at the wrong firm. This is hard for many to believe, but there are commodity brokerage firms out there that do little if anything to train their brokers how to trade commodities. In fact, many of the owners and managers couldn’t make a consistent profit if their lives depended on it. Therefore, they concentrate on the sales end of the business and, as Jankovsky found out, his training consisted of “here is your phone” and “here are your leads” – “now go open some accounts.”

As you can imagine, the clients had the odds stacked against them and Jankovsky was just beating his head against the wall. Many of the commodity brokers he worked for wound up closing their doors as the NFA caught up to them or they simply didn’t pay their bills. Many of the shady brokerage firms concentrate solely on getting brokerage commissions from their clients – as many as they can and as soon as they can. Then, they close up shop, take the profits and leave unpaid bills and disgruntled brokers in their wake, along with many clients who had their accounts wiped out.

Jankovsky tries to convey that he tried to do the right thing for his clients, but he became pigeonholed into working for the lower rung commodity brokers. He felt that the legitimate firms would not hire him because he had some blemishes on his record and his resume was filled with some fairly shady brokerage firms. And, when he tried to concentrate on making money for his clients and sacrificing short-term commissions for the long term good, he was fired.

You can imagine this took a huge toll on Jankovsky’s mental state. He turned to drinking heavily and even contemplated suicide. It was a roller coaster ride for Jankovsky as he would make huge sums of money as a broker, then it would all be gone. The largest frustration probably came in trying to figure out how to make consistently make money trading commodities.

Jankovsky actually mocks the retail commodity trader to a degree and reverts the focus of The Art of the Trade to help the small commodity trader gain a fighting chance against the large, successful traders. He does not go into specific trading strategies, rather he focuses on the mistakes retail traders make and provides helpful advice to change the mentality of the losing trader.

The Art of the Trade centers on some brokerage firms in Chicago, but he could have easily been talking about other areas around the country – South Florida? In fact, Chicago has many of the best commodity brokers in the country. After you read this book, you might ask why Jankovsky didn’t just leave the industry when he saw how unscrupulous it could be. I have to say that the futures industry and trading can be very addictive. When things are done the right way and you finally learn how to consistently make money from trading, I feel there is no better way to make a living.

When reading the book, you almost feel the author is just writing one big rant that becomes a bit annoying at times. He almost sounds like he is simply whining. I guess when someone bears his soul, that is what you get. The Art of the Trade should serve as a caution to those who want to select a full service commodity broker. Most of the commodity brokers are ethical and try to do the right thing for their clients, while only a small percentage will try and take you for everything you have. But the fact remains that many brokers cannot consistently make money for their clients and that is were the main problem lies.