Meet Carol Harmer: 44 Years in the Markets, from LIFFE to Today

Carol Harmer · Asset Management · Beginner

Carol Harmer started on the LIFFE trading floor in 1982 and has spent more than four decades in financial markets. In this introduction she walks through her career: trading open outcry at LIFFE, building technical trading desks at Midland Bank, Nomura and Credit Suisse, leasing her own seat as a Local Trader, and later trading hedge funds and training thousands of traders around the world. She also explains how she teaches: honestly, without ego, and with no get-rich-quick promises. You'll hear what to expect from her modules and what she expects from you as a student. This is the first video in Carol's series on Reasoned. Next up: trading psychology, risk management, and chart reading. Educational content only. Not financial advice. Trading involves risk and you can lose money.

Transcript

Good afternoon. My name is Carol Hmer and I'm responsible for producing or founding Chararma Trading and Chararma Charts. Chara Charts came first. So this is a little bit about me and my background. I started my career back in 1982 in the London International Financial Futures Exchange. It was a new exchange and nobody really knew what what what was going to go on and how it was going to work.

And I worked for the exchange for about a year before we went live. We went live on the 30th of September 1982. Great. And from that day, I wanted to be a trader without a doubt. Now, this was 1982, 1983. I have to tell you, women traders were not forefront in that particular time frame. And I was told quite categorically, you'll never be a trader. You're not going to trade in the pit.

Um, I was a single mom of two, so it was hard, but I was determined. Absolutely determined. And I finally got a break after after a year. Um, and I became a trader. I first had to do I had to become a runner. Um, that's where you you check your dog's body for that company. And it was a commodity company who traded only in the long bond, 30-year long bond, which isn't traded quite so much these days.

But anyway, you know, I um I went through that process and it was very exciting. even though I was a yellow jacket and then I had to take my trading exam. Fantastic.

And then I [clears throat] um I qualified to be a trader and I was the first lady trader, woman trader that actually traded in the long bond. And I have to tell you, I traded bad. We didn't really have any idea what charts were or technical indicators back then, back in the day. You're going back 40 44 years. So, you're going back quite a while. So, all we had for us was fundamental data.

And because I was trading the long bond, it was pretty difficult because being new and a woman, you sort of you counted I suppose a bit. You you you you thought that these long bond traders from America, from Chicago would, you know, were experienced. They knew what they were doing and we had to follow suit. Well, all I saw was the bond went up every day and they were always selling it. So, I was a bit disconcerted.

Anyway, I'm going to cut a very long story short, I discovered purely by accident whilst waiting for an M1 figure one night, purely by accident, I discovered a little guy around the corner behind the back of the boos was updating his charts.

I asked curiously and he said, "I upload charts every day to a company called Tellyate." So I'm like, "I need to know more about this." And he asked me what I traded. I told him and he brought this chart up from me and instantaneously I could see I just knew. It was like a light bulb had gone. I knew where the bond was going. that 30-year was going.

And the reason where the all the other traders didn't didn't look or didn't know was because ever since the bonds had opened in Chicago in 1977, they'd been in this huge downtrend. So obviously traders made money by being short.

So it's very difficult to to get traders. I mean, I I now know this all these years later, but this was still prevalent then. It's very difficult to get traders to change their view. And even when the bonds had gone sideways for a year, 18 months, they still made more money being short than buying dips. There was no reason. But when I started trading, the bonds had broken out.

they'd broken their base pattern and they started to go up. So the very next day when my boss came in and he said, "I'm going to go see other buttons." And I'm like, "No, no, you know, do you can I can I buy some?" And he said, "Yeah, you've got 25 lots." Now, bearing in mind a contract was 1 million, so I could have 25 million, but he would be selling um 400 million at a time.

So, you know, whatever I did, it wasn't going to hurt his position. As luck would have it, I I started to make money and I never looked back. From that point, my whole entire trading strategy changed. I threw out the Wall Street Journal. I threw out the Financial Times. I didn't care about figures anymore because what had proven to me over the six months that I'd been a fundamental trader.

What that proved to me was they the market had changed and the traders the fundamentals hadn't caught up yet. It they hadn't quite mastered. We'd gone from a bare market to a side maze market to a bull market that hadn't clicked.

So for me it had clicked pretty early on. So I carried on just buying buying the bonds and whatever you life carried on the way way that was really good for me. I enjoyed it. I loved being part of that throng of traders. It was great. And but then I become more curious. It's like well who's putting the orders into the pit?

who who's doing all this there. It's not coming from the floor. The floor isn't generating its own its own orders. They're coming from somewhere. And I was working for Midland Bank at the time, Middle Bank floor team, which was the biggest on the floor and certainly the biggest in the 30-year bond. But I wanted to know more. I wanted I was like a sponge. I needed to know more.

So, because I used to go back to the office um every night after After life shut, I used to go back to the office and trade into Chicago and I met a guy called Graeme and I got a call asking if I'd go and see the treasurer, Mr. Simpson, which I did. I went back and this guy Graeme was there and I said, "Oh yeah, I've got to go and see um I got to go and see Mr.

Simpson." and he said, "Hi, my name's Graham Simpson." And I'm like, "Oh, wow." Um, and what they wanted me to do was to help set up a technical trading desk at Midland Bank, which I jumped at it. Although, you know, I loved being part of the life floor team because I knew I wanted to expand my knowledge in various markets, especially FX.

I want that for me to set up a technical trading desk at a huge huge English bank, London Bank was was great. So that's what I did. I waved goodbye to the floor and off I went to um set up this technical trading desk. Now bearing in mind back then we had very little. We don't have the systems nowhere near the systems that you have these days at your very fingertips.

For me, I used to have to draw all of my charts by hand using point and figure normally point and figure and then once a week we got this book where we could fill in the the bar chart. I mean, it's funny now when you think about it, but it wasn't 24. FX was 24 hours, but the other markets weren't. So, you could, you know, you could fill them in and it was quite accurate what we did. Um so that carried on.

I was there for about two years. We become very profitable. Our desk we increased our size. So we went from three women lovingly known as slappers corner which they wouldn't get away with these days.

And then my boss Graeme Graham Simster he was asked to be treasurer at a new bank. It was the new bank for Japan. It was the first bank to get it Japanese banking license and they hadn't got it yet. So the mother company was Namura International which in the mid 80s was obviously the biggest company in the world and Namura International wanted a bank.

So they could have easily bought City Bank or Bank of America, but they decided to set up their own bank. And so eight of us went to join Namura um as a startup operation. I was the first woman manager that Namura had ever employed. I was manager of technical trading, which was great. So all I did is I just transferred what I did at Midland to this new venture, this new Japanese bank.

There was, as I said, there was only eight of us. So the early days were quite stressful really because we wasn't sure if we was even going to get our banking license. So we did and as far as I'm aware now, Namura has 4,000 employees. So little bit of history.

Now all through the 80s you had central bank intervention at every every other day. You know one of the central banks would intervene. So the ranges were quite wide in the forex market and you saw the order flows come in and you know kept your charts with a little bit more data for technical stuff. Not much, still very, very limited.

And it was only when I left Namura and I was headunted for the position of head of technical trading at Credit Swiss that the um systems were all available to you. Reuters were doing it, CQG were doing it for futures. Um you had so much Bloomberg, it was great.

So I worked at Credit Swiss for six years as head of technical trading and um after six years I decided to go back to my first love which was the life floor and leis and trade my own money.

That was interesting. So for all those years I'd been a a trader on life. I'd been a bank trader. Um, and I was going back to life to I was going to trade my own money.

So, I leased the seat, got a clearing company to do that for me, cuz obviously you needed a clearing company. And off I went. I was then asked by a friend of mine to help run a group of 20 life locals. So, I was a local. They called you local back then. I was a local. And I was asked to help these 20 traders with these 20 traders. I went through the charts with them. I got them to look at their strategy for the day.

Although they were very very busy because they were in and out in and out all day long. At least then they knew where the major points were on the charts so they could trade accordingly, you know. So that was that was good. I enjoyed that. So that was four years. And then in 2000 the life floor shut down. And it was quite sad really cuz I'd been there from day one. Well, pre-day one.

And I was there right till the very end, you know. So I was there day one and the last day which was pretty bittersweet. And after that I still c I' I'd created chararma charts in 1996 um purely because the life locals they weren't as chart orientated as the bank dealing rooms were.

So for me it was get the locals up to a certain level so that they could at least compete with the bank dealers that were putting in the orders to the floor which I think you know I did pretty well with it as Chararma Charts really took off and when the live market shut we had um trading arcades open all over.

So, Chararma Charts carried on and I carried on trading my own account and then I went and I ran a hedge fund. I ran two actually hedge funds still doing exactly the same thing, you know. Um, and I still do it. I mean, I don't do hedge funds these days. I've gone more into education, but whatever bank I've worked at, I have always trained traders and dealers. And I've done it globally. I've worked in New York.

I've worked in Chicago. I've done online courses. Department have come over and I've taught. So my I've got a wealth of experience.

I don't think I'm not sure but I don't think there's anybody in the market at the moment who has done working for life being a trader on life being a local on life working in big bank dealing rooms I worked at Midland Namura bank credit Swiss then I went back and was a life local and run hedge funds and I'm still, you know, all these years later, um, I'm still doing it. I'm still trading. Um, I like education now.

I prefer that because it's been 40 plus years and the 18our days I'm not too keen on these days. So, as I say, I've trained thousands of traders over the years, over my four plus decades, and it's what I enjoy doing. You know, I love to see when you're explaining something and you're teaching somebody and all of a sudden it's like this little light bulb comes on and they get it.

They completely understand what you're talking about. And, you know, it's a really good feeling. And I'm I think I'm a good educator because I've been there, done it, seen it, got the t-shirt. Really, there's very few around as I said that I've had my wealth of experience. And not only that, I've worked through the 87 stock crash, the tech stock crash of 2000, the 911 stock market crash, 2008, 2009, you know.

that one as well. I have worked in under every every circumstance you could possibly work under. So, I know that my style and my way of trading it is it's profitable. You know, even when it seems like you're working in complete chaos is going on around you, you can still make sense of the way that I trade and the charts that I trade. So, anyway, that's what I aim to do now.

I aim first, this is the getting to know you video and I hope I put myself across as well as I can and my experience as well as I can. Um, and I'm going to do another video quite soon which tells you a little bit more about not about me so much but the psychology of trading.

Okay, well have a great afternoon. Thank you.