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12 Great Chess Quotes For Traders

Some great chess quotes from Garry Kasparov that can apply to chess, trading, or life.chess-trading

  1. You must know what questions to ask and ask them frequently. Questions are what matters. Questions, and discovering the right ones, are the key to staying on course.
  2. The top achievers believe in themselves and their plans, and they work constantly to ensure those plans are worthy of their belief.
  3. Personal style is not generic software that you can download. You must instead recognize what works best for you and then, through trial and error, develop your own method- your own map.
  4. We must also avoid being distracted from our strategic path by the competition.
  5. Play the opening like a book, the middle game like a magician, and the endgame like a machine.
  6. You may learn much more from a game you lose than from a game you win.  You will have to lose hundreds of games before becoming a good player.
  7. Chess is everything: art, science, and sport. (more…)

Development of trading expertise

anim_expertise1) Much of performance learning is the cultivation of positive habit patterns – If you have to make efforts to follow trading rules, that is effort not devoted to tracking markets. The key to success is turning rules into habits, so that they can be followed without effort, preserving mental capital for analysis and decision-making.this excellent New Yorker article on Toyota and the notion of kaizen. The path of kaizen is difficult to follow, but it’s a sure path to excellence.

2) The development of new habits opens the door to fresh ways of thinking and behaving – I’ve long noticed that successful traders periodically remake themselves and their trading, adapting to changing market conditions. They cultivate new habits, which aids them in developing new skills and ways of making money.

3) We will learn and perform best by making maximum use of our learning strengths – This is an extension of the notion of operating within a trading niche. If we’re engaged in a concerted program of learning and development, it makes sense to ground our efforts in learning competencies.

4) Performance improvement often occurs in small, continuous steps forward – This is an idea central to quality and performance improvement among manufacturing firms. The successful trader may set a single goal each trading session and track progress faithfully. Over the course of a year, that is hundreds of opportunities missed by the trader who lacks such goals. Take a look at

My Time at Lehman

I started at Lehman Brothers on June 1st, 2007 as a first year analyst. It was my first job out of college. Dick Fuld, the CEO at the time, publicly discussed “the road to two-hundred,” in which he would not retire until the stock reached $200 per share, almost three times the price when I arrived. Everyone at the firm believed this as though it were a fact – that there was something special about Lehman Brothers stock – it always went up.

I joined Lehman for a few reasons. The first was personal. My mother worked on Wall Street and passed away when I was a teenager. I felt, somewhat misguidedly, as though following in her footsteps would bring me closer to her. The other reasons were simpler. I had been interested in the stock market as a kid (though I went to work trading bonds and credit derivatives), I wanted to make good money, and I thought maybe, just maybe, it would be a bit of fun. (more…)

Twelve of The Biggest Trading Losses in History

LOSS-LOSSIf you are ever feeling down about your trading losses or feeling sorry form Ackman’s current disaster trades long J.C. Penney and short Herbalife then this article may put both of these losses into perspective. These losses really show how crucial it is to have a price level that will indicate that you were wrong and will need to stop out at. There is no reason to ever take a huge loss to your trading capital, position sizing, stop losses, and managing the risk of ruin is the first job of a trader, growing capital comes second.

“Two basic rules: (1) if you don’t bet, you can’t win. (2) If you lose all your chips, you can’t bet.” -Larry Hite

Here are 12 of the biggest trading losses of all time, heed the lessons of these tragedies and realize the traders on the other sides of these trades made a huge amount of money,

#12 German billionaire Adolf Merckle, one of the 100 richest people in the world, killed himself by jumping in front of a train—emotionally “broken” over a bad bet on Volkswagen in 2008.

Merckle’s business interests came out on the wrong side of 2008′s short squeeze of Volkswagen. Rival Porsche silently cornered the market on Volkswagen shares, and when they revealed the extent of their stake, the price of Volkswagen stock shot up to levels that made it briefly the world’s most valuable corporation. Many hedge funds who had bet against Volkswagen shares lost huge amounts of money, while Porsche made billions in profit. (more…)