This book may be one of the greatest trading books ever published. Jack Schwager set about interviewing some of the world’s top traders in 1988 and the principles these traders were kind enough to share has stood the test of time. These were not one year wonders these traders had records for over a decade, some had winning 20 year records.
Here are some of the greatest quotes from this book:
“A good trader can’t be rigid. If you can find somebody who is really open to seeing anything, then you have found the raw ingredient of a good trader.”
“You have to be willing to make mistakes regularly; there is nothing wrong with it. Michael taught me about making your best judgment, being wrong, making your next best judgment, being wrong, making your third best judgment, and then doubling your money.”
“When the news is wonderful and a market can’t go up, then you want to be sure to be short.”
“If you don’t stay with your winners, you are not going to be able to pay for the losers.”
“Whenever I enter a position, I have a predetermined stop. That is the only way I can sleep. I know where I’m getting out before I get in. The position size on a trade is determined by the stop, and the stop is determined on a technical basis. For example, if the market is in the midst of a trading range, it makes no sense to put your stop within that range, since you are likely to be taken out. I always place my stop beyond some technical barrier.”
“The first rule of trading—there are probably many first rules—is don’t get caught in a situation in which you can lose a great deal of money for reasons you don’t understand.”
Link to Amazon: Market Wizards
http://youtu.be/ErI09bA0t1w