Trading

Trading provides one of the last great frontiers of opportunity in our economy. It is one of the very few ways in which an individual can start with a relatively small bankroll and actually become a multimillionaire.

Jack D Schwager

The key to trading success is emotional discipline. If intelligence were the key, there would be a lot more people making money trading… I know this will sound like a cliche, but the single most important reason that people lose money in the financial markets is that they don’t cut their losses short.

Victor Sperandeo

It’s much easier to learn what you should do in trading than to do it. Good systems tend to violate normal human tendencies.

William Eckhardt

I think investment psychology is by far the more important element, followed by risk control, with the least important consideration being the question of where you buy and sell.

Tom Basso

Maximize the good, minimize the bad, and continually forgive yourself.

Don Miller

Losing money is the least of my troubles. A loss never bothers me after I take it. I forget it overnight. But being wrong – not taking the loss – that is what does the damage to the pocketbook and to the soul.

Jesse Livermore

If I have positions going against me, I get right out; if they are going for me, I keep them… Risk control is the most important thing in trading. If you have a losing position that is making you uncomfortable, the solution is very simple: Get out, because you can always get back in.

Paul Tudor Jones

Throughout my financial career, I have continually witnessed examples of other people that I have known being ruined by a failure to respect risk. If you don’t take a hard look at risk, it will take you.

Larry Hite

Throughout all my years of investing I’ve found that the big money was never made in the buying or the selling. The big money was made in the waiting.

Jesse Livermore

Some people say, ”I can´t sell that stock because I´d be taking a loss.” If the stock is below the price you paid for it, selling doesn´t give you a loss; you already have it.

William O´Neill

If you can’t change or control what the market is doing, then the only option you have left is to control yourself in a way that allows you to perceive what the market may do next with increased clarity and objectivity, requiring a thorough working knowledge of the nature of your inner environment in relationship to the outer physical environment.

Mark Douglas

Losing is part of trading. The best traders don’t get perturbed by losing trades, since over the long run they know they will be successful more often than not. When you
are afraid of losing, you end up losing or missing opportunities because you are afraid to trade.

Ari Kiev

Successful trading isn’t about predicting what happens next, it’s about taking the right kinds of risk with your capital.
That becomes far easier when you stay objective with the price action you’re seeing on your preferred timeframe.

Jeff White

In this game, the market has to keep pitching, but you don’t have to swing. You can stand there with the bat on your shoulder until you get a fat pitch.

Warren Buffet

By failing to prepare, you are preparing to fail!

John Wooden

Don’t focus on making money; focus on protecting what you have.

Paul Tudor Jones

The markets are noisy, messy places. The mathematical tools that work best in this environment are simple and robust. You do not need fancy, higher math for most trading applications; you need simple, basic math, but you must understand your tools completely.

Adam Grimes

Trading is the most exciting activity that a person can do with their clothes on. Trouble is, you cannot feel excited and make money at the same time.

Alexander Elder

We are a research organization… We hire people to make mathematical models of the markets in which we invest… We look for people capable of doing good science, on the research side, or they are excellent computer scientists in architecting good programs.

James Simons

Everything’s tested in historical markets. The past is a pretty good predictor of the future. It’s not perfect. But human beings drive markets, and human beings don’t change their stripes overnight. So to the extent that one can understand the past, there’s a good likelihood you’ll have some insight into the future.

James Simons

We are in the business of making mistakes. The only difference between the winners and the losers is that winners make small mistakes, while losers make big mistakes.

Ned Davis

I learned to be especially wary about data mining – to not go looking for what would have worked in the past, which will lead me to have an incorrect perspective. Having a sound fundamental basis for making a trade, and an excellent perspective concerning what to expect from that trade, are the building blocks that have to be combined into a strategy.

Ray Dalio

Most aspiring traders underestimate the time, work, and money required to become successful. To succeed as a trader, one needs complete commitment. Just as in any entrepreneurial venture, you must have a solid business plan, adequate financing, and a willingness to work long hours. Those seeking shortcuts are doomed to failure. And even if you do everything right, you should still expect to, lose money during the first five years – losses that I view as tuition payments to be made to the school of trading. These are cold, hard facts that many would-be traders prefer not to hear or believe, but ignoring them doesn’t change the reality.

Mark D Cook

The best traders I know are really quite brilliant, and they all work very hard – much harder than anyone else. By the way, when I talk about working hard, I mean commitment and focus: it has nothing to do with how many hours you spend in the office. These traders have tremendous commitment to the markets – to their craft so to speak. They develop scenarios, reevaluate scenarios, collect information and reevaluate that information.

Bill Lippshutz

To be a successful trader, you have to be able to admit mistakes. People who are very bright don’t make very many mistakes. In a sense, they generally are correct. In trading, however, the person who can easily admit to being wrong is the one who walks away a winner. Besides trading, there is probably no other profession where you have to admit you’re wrong. In trading, you can’t hide your failures. Your equity provides a daily reflection of your performance. The trader who tries to blame his losses on external events will never learn from his mistakes. For a trader, rationalization is a guaranteed road to ultimate failure.

Victor Sperandeo

People often say, ‘It’s not cheap, but I think it’ll keep going up because of excess liquidity (or any number of other reasons). In other words, they say, ‘It’s fully priced, but I think it’ll become more so.’ Buying or holding on that basis is extremely chancy, but that’s what makes bubbles. In bubbles, infatuation with market momentum takes over from any notion of value and fair price, and greed (plus the pain of standing by as others make seemingly easy money) neutralizes any prudence that might otherwise hold sway.

Howard Markes