Here’s a good news story, which caught my eye last week, in the UK’s Plymouth Herald, about a local teenager, who has turned a £2,000 loan from his father into £21.2 million a year, last year on the forex markets.
His name is Sam Cook and he is still not even 19 years of age. He was given a £2,000 loan from his father, Peter, last February.
Sam, who suffers from dyslexia, always struggled at school; leaving his school, with only two GCSE exams to his name.
However, according the Plymouth Herald’s article, he had a knack for spotting forex market trends. Sam, started when he was only 15, was still at school and dabbled in the markets, with (with his father’s permission) a dummy account where he could win – or lose – points rather than money.
However, over time, his ‘casual’ interest developed into a full-blown obsession, as he gained more experience of the world and he continued his research.
His father, Peter, says that he always had an interest in stocks and shares and that Sam started asking him questions and that he came up with the stories of Mr. Kenco and Mr. Nescafe – explaining how the prices of coffee changed according to the seasonal harvests and so on.
Sam says, according to the article that he hated school and was always thinking about ways of making money.
He goes on to say, “About ten minutes before the end the lesson I’d ask to go to the toilet. I’d go to the tuck machine and buy up most of the favourite sweets. When the lesson ended there’d be a big queue. The ones at the back knew they wouldn’t get what they wanted, so I’d go round selling them stuff at a pretty price.”
Upon leaving school, he travelled out to Sierra Leon and Liberia, with the sole intention of making some money and he even tried his luck with importing olive oil from Italy and motorbikes from China...all, of which, ended in total failure.
However, the forex markets fascinated him and he thought he could probably make some money on stocks, currencies and commodities – trading in resources such as, sugar, coffee, minerals and other agricultural products. And, so he started to really dig in deep; with his research into these market segments.
When his father noticed he was continually making a profit on his dummy trading platform, his father then decided to lend him that £2,000 to get him started for real and every time Sam made some money, he reinvested it all and made even more money. Sam’s first big hit was in making £28,000 from his father’s £2,000 loan in February of that year and by May, it had grown to £100,000.
Sam has twin secrets. He has a trading program he has developed himself, which works on the ‘three-way bet’ system overseeing his multiple, continuing trades: if the market goes the wrong way on three successive bets, his planned trades are automatically reversed. So, if a price falls and Sam has gambled on it rising, he won’t continue to lose out.
“It also allows me to make large numbers of trades as if I were making them individually, if I work making each individual decision at the time.”
Secondly, there is his close observation of the ‘real’ world. “I am not particularly mathematical,” he says.
“People go on about those Oxford graduates who are brilliant at maths and with their trading programs. But they aren’t world-wise. They trade in one area. They don’t look at the big picture, what is happening in the world.
“I have been offered £59million for that software but I’m not selling. It is worth much more than that – it is worth the money it can make.”
Both elements came into play on one amazing day in July.
Sam had been watching the growing volatility across the markets due to the sanctions against Russian over political interference in Ukraine. “I did 290 different trades, some that certain prices would rise, others on prices to fall.
“I was lying on the beach at Crantock and my phone was bleeping. Every trade was going the right way.
“It did not feel real. I felt there must be something wrong.”
The family promptly left the beach so Sam could go on to his computer at home. “It was all right. I’d made £6 million.
“I felt a bit sick. I could not believe it.”
The profits have kept coming in. He wasn’t tempted to pull his money out.
“The more money you have, the more you can make. If you make five per cent on £23,000, what’s that? £1,150. If you make five per cent on £6m that’s £300,000.”
That was illustrated when the European Central Bank ‘printed’ 1.3 trillion Euros in a ‘quantitative easing’ measure to stimulate the weak Euro-zone countries last week. The announcement was widely trailed and the word was that the financial markets had already taken the move into account.
Sam was confident that money could still be made and gambled £1.5million, doubling his money.
As his money has grown, Sam has allowed himself some luxuries. He has enough high-end watches to wear on each day of the week. His favourite is a Cartier studded with pink diamonds, worth £120,000.
“I do like my watches,” he says, adding quickly: “They are an investment. They won’t go down in value.”
While he is happy to make informed gambles on the markets, he is quite cautious about how he spends his money. He has rented rather than bought a flat in the Royal William Yard, believing he can get much better value by building from scratch. Sam has his sights set on a plot “somewhere between Plymouth and Exeter”.
He says: “I am quite tight with money because this has not come easily. It has come quickly but it has taken a lot of mental strength and time.
“It hasn’t changed me. I am still the same person I was before I had the money.”
His dad agrees. “He’s just the same as he was. He was always looking for ways to make money, right from when he was five or six years old,” says Peter. “It’s unbelievable, isn’t it?
“He is so good at it. His mind works like that. With his age, I have been around to support him and we will always be there for him to fall back on.
“He is careful with his money. I don’t rate that Ferrari, though!”
Others behave differently, though. Sam says: “There is a filthy amount jealousy from people. I was not very popular at school.”
He is careful about making friends since he got his fortune. He and girlfriend Evelyn Simpson, 25, got to know each other before he revealed his secret. “I wanted to make sure she was not there for the money,” he admits.
Sam is there for the money – and the long term.
“I want to have £2billion by the time I am 50. You could really do something with that amount of money. I’d get more satisfaction giving that away than buying things like Ferraris.
“I’d like to build some schools if Africa, maybe a refuge for former child soldiers.”
For now Sam is focused on building his capital. He is awaiting approval from the Financial Conduct Authority to set up his own brokerage in Plymouth, allowing him to invest other people’s money.
He has identified a site and expects to have the operation running within three months. He plans to take on about 30 staff, the majority novices, which his brokerage will train.
“There is no need to go to London. You can do everything you want to on the internet in Plymouth. Why would I pay stupid rents in London?
“I will have a couple of experienced people on the (trading) floor. I don’t want to pay for a lot of ‘experts’. I want people who are world-wise.”
For now, though, he has other business to attend to.
“I have to go pick up my girlfriend. She’s been shopping at Lidl. You should see people’s faces when they see a Ferrari in the car park.”
by Victor Romain
Article source: The Plymouth Herald, UK.