Archives of “February 2019” month

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What is the Most Expensive Investing Book?

  
  Education
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The most expensive investing and stock trading book is Margin of Safety: Risk-Averse Value Investing Strategies for the Thoughtful Investor, which you can pick up a new copy of on Amazon (AMZN) for $1,749.00. The book was written by Seth Klarman, the successful founder and president of the Baupost Group, a Boston-based hedge fund. The book has a rating of four stars based on customer reviews and was published by HarperCollins in 1991.

The Beach Ball

  
  Education
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Have you ever tried to hold a beach ball under the water?

You might be successful for few moments, however it only takes a small change in how you are holding it to make it burst up out of the water, hit you in the face and splash you all over.

Sometimes, we as traders try to hold the beach ball under the water. We want the big success, the big win, the huge profits, etc. in a short timeframe. This rarely happens.

What are your current trading traits? What do you expect of yourself? Are you open to new ideas? Are you willing to spend the time needed to build the skills and knowledge base needed to reach your goals?

40 Trading Wisdom -One Liners

  
Analysis, Education

1. Trading is simple, but it is not easy.

2.  When you get into a trade watch for the signs that you might be wrong.

3.  Trading should be boring.

4.  Amateur traders turn into professional traders once they stop looking for the “next great indicator.”

5.  You are trading other traders, not stocks or futures contracts.

6.  Be very aware of your own emotions.

7.  Watch yourself for too much excitement.

8.  Don’t overtrade.

9.  If you come into trading with the idea of making big money you are doomed.

10.  Don’t focus on the money.

11.  Do not impose your will on the market.

12.  The best way to minimize risk is to not trade when it is not time to trade. 

13.  There is no need to trade five days a week.  

14.  Refuse to damage your capital.

15.  Stay relaxed.

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10 Things Traders Must Quantify

  
  Education
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  1. What exactly is your entry signal going to be? What technical indicators will trigger you to enter a trade?
  2. What will the perceived edge for your entries be based on? Will you quantify your entries edge with back testing of through trading principles?
  3. Will you wait for an initial move in the direction of your trade entry or will you enter based on a technical indicator trigger?
  4. How will you trade in different market environments and trends? Will you have better odds of success buying dips in bull markets and shorting strength in down trends?
  5. What is the risk/reward ratio for the trade you want to take? How much are you willing to risk if the trade is a loser? How much could you make if you are right? Is it worth it?
  6. What are the probabilities that this entry will be a winning trade based on past historical price data and charts? With the winning percentage in mind how big do the winners have to be and how small do you have to keep the losers for the trading system to be profitable?
  7. Where should your stop loss be? At what price level will your entry be wrong and signal you to exit the trade with a loss?
  8. How big of a position size should you take based on your stop level and total capital you are willing to risk on this one trade?
  9. Is your position size small enough to enable you to hold the trade without emotions effecting your ability to follow your trading plan?
  10. When you open this trade in addition to your other positions, how much of your total trading capital is now exposed to loss if all trades went against you at the same time?
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