As 2007 draws to a close, lets take a moment to reflect on what we have learned by highlighting our mistakes. We all make them, there are no exceptions to that rule. The only variable here is how big of a mistake was it.

I'll start. My biggest financial mistake of 2007 was going against my good friend David Gordon's advice and jumping into the options market without adequate knowledge or experience. Instead of sticking with my bread and butter of stock trading (short and long term), I wanted to test my luck in the options market. To my shock, I have never seen so much money lost so quickly from my portfolio. While I did have a couple triple digit percentage winners, I also had a couple options expire to the worthless state.

The real shocking thing was that I had picked winning stocks, but in the game of options, you need not only winning stocks but also winning time frames. This is where I fell short and the lesson was learned. You see with options, you need not only to pick the correct price, but also the correct time frame. My investment strategy doesn't look at time frames but rather stock behavior to determine my buy/sell points. While time is also an important factor when I trade, to limit my forward looking time frame was something I wasn't comfortable with from the beginning. None the less, I jumped into the options market against my better judgment.

My lesson was learned the hard way as the option market, while good for some, is not for me. So now I ask what is your biggest financial mistake of the year? Was it a bad investment, poor purchase, not recognizing a financial scam, not saving enough or all the above? I will be very interested to hear what the readers of 22 have to say. Too much these days I read on other financial websites/blogs how fabulous they are (over emphasizing the good) and how they never made a mistake (down playing or never mentioning at all the bad). While this kind of behavior can be expected on the web, it gets old after a while, so lets hear the flip side so we can learn from each other's experiences.

What was your biggest financial blunder this year?

If you’re a fan of

22Dollars.com: If you had to sum up your book in one sentence, what would you say?

Timothy Sykes: This is a story for anyone who has ever loved the stock market—all the risks, rewards, joys, frustrations and exhilarations.

22: What is your favorite passage from the book?

TS: “…the incredible lack of freely available information regarding financial speculation and hedge funds hurts society as a whole. Industry regulations have created an environment that is ripe for fraud and manipulation, which leads to unnecessary losses, not to mention it hinders people’s abilities to learn from past successes and failures. These are the dark ages for hedge funds. No longer will I play by these misguided rules. I should be free to discuss my business, for I am an American entrepreneur. I call this freedom of finance. Freedom of finance is the concept of a hedge fund manager’s right to discuss business freely without fear of penalty or censorship. I practice what I preach; this is my story.”

22: Are there any parts of your story that you were unable to include in the book, but would be of interest to the readers of 22Dollars.com?

TS: Yes, the book is not very technical because I wanted it to appeal to as broad an audience as possible. For those who understand trading, I’ve posted the charts of the trades mentioned in the book on my website, http://www.timothysykes.com. The readers of 22Dollars.com should definitely check them out because these charts are unique to smallcaps and they are responsible for ALL my earnings, both from the long or short side.

22: We’ve heard that you are going to try to repeat your early success, by turning $12,000 into a fortune again. Is there anything you’ll do differently this time around?

TS: Yes, one month into this challenge, I’m up to $14,000 and change! This time around, I’ll be much more conservative because I want to promote responsible financial speculation (yes, there is such a thing). Also, I’ll be detailing every trade, idea and basically everything I do in pursuit of this goal on my website and I’m encouraging everybody to ask questions in the forum on my website because I believe in full transparency. It’s sad that honesty is a revolutionary business model in the finance world, but I truly believe we must detail our failures in addition to our successes because it’s only through our understanding of the past that we are better prepared to take advantage of the future.

22: What does the future hold for you? Where do you hope to be in five years?

TS: I have no idea—nobody in finance has ever tried anything like this, so it’ll be interesting to see how it all turns out. Whatever happens, I’m loving every second of it because now that I’ve closed my hedge fund, I’m free to discuss everything openly. In five years, I’ll probably be about 1/3 of the way to my $1.65 million goal, but the real achievement will be determined by how many people will see the kind of hard work, dedication and discipline required to be a successful trader. And, I’m not sure if I’ll have accomplished this by then, but I hope to show everyone how fun finance can be, how amazing smallcaps and penny stocks are (if you understand what to look out for) and how a life devoted to learning, working and teaching is more fulfilling than a life devoted solely to making money.

22: Are there any quotes you live by? What are they?

TS: “The four most expensive words in the English language; ‘this time it’s different’” —Si