What Sun Tzu Wrote:
“Hence the saying: If you know the enemy and know yourself, your victory will not stand in doubt; if you know Heaven and know Earth, you may make your victory complete.”
What This Means to the Modern Financial Professional:
The FP must be constantly surveying all elements of a situation to uncover opportunity, such as local market influences and idiosyncrasies, to gain a psychological advantage. It is not enough to know your own strength and your opponent’s capabilities. It is through the continuous surveying of the landscape that hidden opportunities arise. The masters of the hedge fund universe know this all too well. Gigantic fortunes were made off the sub-prime crises. Common sense “dictated” that mortgages would never be paid. Soros shorted the British pound in 1992 and had a billion dollar payday certainly qualifying for a sacred spot in the Guinness Book of Records.