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8/17/2019 59950770 Trading Wisdom Quotes
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Courtesy of MercenaryTrader.com
One of the best sites on the web for great trading wisdom.
1325 You are what you do. A man is defined by his actions, not his memory. Total Recall
1324
If a self-reinforcing process goes on long enough it must eventually become
unsustainable because either the gap between thinking and reality becomes too
wide or the participant's bias becomes too pronounced. Hence, reflexiveprocesses that become historically significant tend to follow an initially self-
reinforcing, but eventually self-defeating, pattern. That is what I call the boom/bust
sequence. George Soros
1323
Usually some error in the act of valuation is involved. The most common error is a
failure to recognize that a so-called fundamental value is not really independent of
the act of valuation. That was the case in the conglomerate boom, where per-
share earnings growth could be manufactured by acquisitions, and also in the
international lending boom where the lending activities of the banks helped
improve the debt ratios that banks used to guide them in their lending activity. George Soros
1322
Economic theory needs to be fundamentally reconsidered. There is an element ofuncertainty in economic processes that has been largely left unaccounted for... We
must take a radically different view of the role that thinking plays in shaping events. George Soros
1321
Classical economic theory assumes that market participants act on the basis ofperfect knowledge. That assumption is false. The participant's perceptions
influence the market in which they participate, but the market action also
influences the participant's perceptions. They cannot obtain perfect knowledge of
the market because their thinking is always affecting the market and the market is
affecting their thinking. George Soros
1320 If you really want to know yourself, just become a speculator. Trading proverb
1319 There is no way one could produce results like ours without ups and downs. George Soros
1318
The real-time experiment turned out to be a very good idea because it stimulated
my thinking. Having to explain my reasons for making decisions forced me tobecome more coherent; it imposed a certain discipline on me, which was very
helpful. George Soros
1317
I felt it was too late to go short, but then I re-read my memo that predicted that they
would go bust and I realized that it could never be too late. It was the only time I
made more than 100 percent on my money on the short side because, as the
stocks went down, I kept topping up my short positions. George Soros
1316
In their worship of logic and rationality, economists are amusingly short-sighted
and irrational. Jack Sparrow
1315
When the California residential home market collapsed, the market thought the
company might go broke, but it survived the test and we made a fortune. That is
when I made the rule that one should own stocks when they have successfully
passed a difficult test, but one should avoid them during the test — something that
is easier said than done. George Soros1314 I am good at riding the tide, but not the ripples of a swimming pool. George Soros
1313
...I am particularly keen on investment theses that the market is reluctant to
accept. These are usually the strongest. George Soros
1312
[The danger in taking risks] stimulates me. But don't misunderstand what I am
saying: I don't like danger; I like to avoid it. That is what makes my juices flow. George Soros
1311
There is nothing like danger to focus the mind, and I do need the excitement
connected with taking risks in order to think clearly. It is an essential part of my
thinking ability. Risk taking is, to me, an essential ingredient in thinking clearly. George Soros
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1310
Risk taking is painful. Either you are willing to bear the pain yourself or you try to
pass it on to others. Anyone who is in a risk taking business but cannot face the
consequences is no good. George Soros
1309
I am outside. I am a thinking participant and thinking means putting yourself
outside the subject you think about. Perhaps it comes easier to me than to many
others because I have a very abstract mind and I actually enjoy looking at things,
including myself, from the outside. George Soros
1308
Most of the time we are punished if we go against the trend. Only at inflection
points are we rewarded. George Soros
1307
I watch out for telltale signs that a trend may be exhausted. Then I disengage from
the herd and look for a different investment thesis. Or, if I think the trend has been
carried to excess, I may probe going against it. George Soros
1306
The prevailing wisdom is that markets are always right. I take the opposite
position. I assume that markets are always wrong. Even if my assumption is
occasionally wrong, I use it as a working hypothesis. George Soros
1305
Being so critical, I am often considered a contrarian. But I am very cautious about
going against the herd; I am liable to be trampled on... Most of the time I am a
trend follower, but all the time I am aware that I am a member of the herd and I am
on the lookout for inflection points. George Soros1304 Are you gonna bark all day, little doggie, or are you gonna bite? Reservoir Dogs
1303
I come from the water, that weren't no easy thing... It's more than nature, it's like
my destiny... The Toadies
1302 'Get a hunch and bet a bunch.' Trading proverb
1301
When everyone 95% agrees on something — home prices will never decline,
China can't be stopped, commodities can't go down, etc. — there is real risk of
'everyone' taking a frying pan to the face. Jack Sparrow
1300
To others, being wrong is a source of shame; to me, recognizing my mistakes is a
source of pride. Once we realize that imperfect understanding is the human
condition, there is no shame in being wrong, only in failing to correct our mistakes. George Soros
1299
I look for conditions of disequilibrium. They send out certain signals that activate
me. So my decisions are really made using a combination of theory and instinct. If
you like, you may call it intuition. George Soros
1298
I work with hypotheses. I form a thesis about the anticipated sequence of events
and then I compare the actual course of events with my thesis; that gives me a
criterion by which I can evaluate my hypothesis. George Soros
1297
I would put it this way: I do not play according to a given set of rules; I look for
changes in the rules of the game. George Soros
1296 Making money in commodities is easy -- but just try to keep it. Trading proverb
1295
If you want to make a birthday cake from scratch, you must first create the
universe. Carl Sagan
1294
That is the nature of pattern recognition, asking 'What can I infer about this
situation based on similarities to what I already know and trust that I understand?'
There is less emphasis on trying to reason out things on the basis that they arespecial because they are unique, which in a financial context is perhaps the
definition of a speculation... It creates an impulse always to connect new
knowledge to old and to primarily be interested in new knowledge that genuinely
builds on the old. Alice Schroeder
1293
People who are psychologically and financially invested in a stock work very hard
to resolve any newly arisen cognitive dissonance in favor of their vested interests. Alice Schroeder
1292
As humans, our brains aren't really wired to make good probabilistic decisions.
(Actually, this is a huge understatement; many of us never fully grasp the ideas of
probability and expectation at all.) Dan Harrington
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1291
But of course there is no secret; there is only the doing of all those little things,
each one done correctly, time and again, until excellence in every detail becomes
a firmly ingrained habit, an ordinary part of one's everyday life. Daniel F. Chambliss
1290
In the pursuit of excellence, maintaining mundanity is the key psychological
challenge. In common parlance, winners don’t choke. Faced with what seems tobe a tremendous challenge or a strikingly unusual event, such as the Olympic
Games, the better athletes take it as a normal, manageable situation ('It's just
another swim meet,' is a phrase sometimes used by top swimmers at a major
event such as the Games) and do what is necessary to deal with it. Daniel F. Chambliss
1289
Athletes move up to the top ranks through qualitative jumps: noticeable changes in
their techniques, discipline, and attitude, accomplished usually through a change in
settings (e.g., joining a new team with a new coach, new friends, etc.) who work at
a higher level. Without such qualitative jumps, no major improvements
(movements through levels) will take place... Daniel F. Chambliss
1288
Superlative performance is really a confluence of dozens of small skills or
activities, each one learned or stumbled upon, which have been carefully drilledinto habit and then are fitted together in a synthesized whole. There is nothing
extraordinary or superhuman in any one of those actions; only the fact that they
are done consistently and correctly, and all together, produce excellence. Daniel F. Chambliss
1287
Every generation has its characteristic folly, but the basic cause is the same:
People persist in believing that what has happened in the recent past will go on
happening into the indefinite future, even while the ground is shifting under their
feet. George J. Church
1286
A great company could be a terrible investment if its price rise has already more
than discounted the bullish fundamentals. Conversely, a company that has been
experiencing problems and is the subject of negative news could be a great
investment if its price decline has more than discounted the bearish information. Jack Schwager
1285
When to get out of a position is as important as when to get in. Any market
strategy that ignores trade liquidation is by definition incomplete. Jack Schwager
1284
Risk control should not be confused with fear of risk. A willingness to accept risk is
probably an essential personality trait for a trader. Jack Schwager
1283
One of the greatest tragedies of life is the murder of a beautiful theory by a gang of
brutal facts. Benjamin Franklin
1282
Even great traders sometimes have completely wrongheaded ideas when they
start. They ultimately succeed, however, because they have the flexibility to
change their approach. Jack Schwager
1281
Define a target, a strategy consistent with the target, a set of disciplines to follow,
and risk management guidelines. Then trade, track, and evaluate your
performance. Ari Kiev
1280
The objective of setting a target is not necessarily to reach it, but rather toestablish a standard against which to measure your performance. If you are not
reaching your target, it forces you to focus on what you are doing wrong or what
you may not be doing that you should. The target holds you to a higher standard of
performance. Ari Kiev
1279
Believing that an outcome is possible makes it achievable. The classic example is
Roger Bannister's penetration of the four-minute mile mark. Before he ran his sub
four-minute mile in 1954, this feat was considered an impossible barrier that was
beyond human physical capabilities. After he ran his so-called magic mile, many
other runners suddenly began breaking this once seemingly impossible barrier. Ari Kiev
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1278
The mind must always be in the state of 'flowing,' for when it stops anywhere that
means the flow is interrupted and it is this interruption that is injurious to the well-
being of the mind. In the case of the swordsman, it means death. When the
swordsman stands against his opponent, he is not to think of the opponent, nor of
himself, nor of his enemy's sword movements. He just stands there with his sword
which, forgetful of all technique, is ready only to follow the dictates of the
subconscious. The man has effaced himself as the wielder of the sword. When hestrikes, it is not the man but the sword in the hand of the man's subconscious that
strikes. Zen master Takuan
1277
The mind could be said to be working at a very high speed, but with no intentions,
plans or direction. In analogy a clear mind is compared to a still pond, which is able
to clearly reflect the moon and trees. But just as waves in the pond will distort the
picture of reality, so will the thoughts we hold onto disrupt the true perception of
reality. Wikipedia (Mushin)
1276
Mushin is achieved when a person's mind is free from thoughts of anger, fear, or
ego during combat or everyday life. There is an absence of discursive thought and
judgment, so the person is totally free to act and react towards an opponent
without hesitation and without disturbance from such thoughts. At this point, a
person relies not on what they think should be the next move, but what is theirtrained natural reaction or what is felt intuitively. Wikipedia (Mushin)
1275
Clouds are not spheres, mountains are not cones, coastlines are not circles, and
bark is not smooth — nor does lightning travel in a straight line. Benoit Mandelbrot
1274
Think. Prepare. Plan in advance when there's no time pressure. Then, in real life,
do what you said. Mike Bloomberg
1273
Being a great trader is a process. It's a race with no finish line. The markets are
not static. No single style or approach can provide superior results over long
periods of time. To continue to outperform, the great traders continue to learn and
adapt. Jack Schwager
1272
You can't control what the market does, but you can control your reaction to the
market. I examine what I do all the time. That's what trading is all about. Steve Cohen
1271
You can't have everybody on one side of the fence. The world doesn't work that
way. Steve Cohen
1270
When I saw that screen light up that day in the Merrill Lynch offices, I lost any
residual doubt that Bloomberg could make it. We had picked just the right project.
It was big enough to be useful, small enough to be possible. Start with a small
piece, fulfill one goal at a time, on time. Do it with all things in life. Sit down and
learn to read one-syllable words. If you try to read Chaucer in elementary school,
you'll never accomplish anything. You can't jump to the end game right away, in
computers, politics, love, or any other aspect of life. Mike Bloomberg
1269
I have friends who get emotional about the market. They fight it. Why put yourself
in that position? Steve Cohen
1268
The thing is to start moving your feet. I find that too many traders just stand there
and let the truck roll over them. Steve Cohen
1267
If I am in a trade because of a catalyst, the first thing I check is whether the
catalyst still applies. Steve Cohen
1266
[Wharton] taught you that 40 percent of a stock's price movement was due to the
market, 30 percent to the sector, and only 30 percent to the stock itself, which is
something that I believe is true. I don't know if the percentages are exactly correct,
but conceptually the idea makes sense. Steve Cohen
1265
Whatever attitude you are in, do not be conscious of making the attitude; think only
of cutting. Miyamoto Musashi
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1264
Hand reading works because most players play most hands in a relatively logical
way most of the time. By bringing logic to bear on their decisions, you can keep
eliminating hands that don't fit the observed data. Dan Harrington
1263
If you can get savage capitalists to rationally act like a team, then you have a
beautiful thing. Cliff Asness
1262 They can steal your idea, but they can't steal execution. Silicon Valley proverb
1261David didn't beat Goliath with a whiteboard. Go get amongst it, and prepare to boband weave. Tim Ferriss
1260
It comes down to trying to expose yourself to the best things that humans have
done — and then try to bring those things into what you're doing. Steve Jobs
1259
A market that is driven by inflows can have small corrections, but it has to then
immediately recover to new highs to keep generating new money inflows.
Otherwise, money inflows are likely to dry up, and the market will fall apart.
Therefore, this type of market is likely to either trend higher or break sharply. John Bender
1258
Each stock has its own probability distribution that depends on a host of factors.
Who has what position? Where did the major buyers accumulate their positions?
Where are their stop-loss points? What price levels are likely to be technically
significant? John Bender
1257
It's not a matter of coming up with a one-size-fits-all model that is better than the
standard Black-Scholes model. The key point is that the correct probability
distribution is different for every market and every time period. The probabilitydistribution has to be estimated on a case-by-case basis. John Bender
1256
Regardless of whether technical analysis has any validity, enough people believe
in it to impact the market. For example, if people expect a stock to find support at
65, lo and behold, they're willing to buy it at 66. That is not a random walk
statement. John Bender
1255
It might seem that if you have an edge, the way to maximize the edge is to trade as
big as you can. But that's not the case, because of risk. As a professional gambler
or as a trader, you are constantly walking the line between maximizing edge and
minimizing your risk of tapping out. John Bender
1254
I don't think anyone is more disciplined than I am. When I put on a trade, I have a
contingency plan for every possible outcome. I can't think of any circumstance that
would be an exception. If there were, I would have a plan for that too. Mark Minervini
1253
Normal human tendencies are traits that cause you to do poorly. Therefore, to be
successful as a trader you need to condition abnormal responses. You hear many
traders say that you have to do the opposite of your gut response — when you feel
good about a position you should sell, and when you feel terrible about it, you
should buy more. In the beginning that's true, but as you condition yourself for
abnormal responses, somewhere along the line you become skilled. Then your gut
becomes right. Mark Minervini
1252
I would rather get stopped out of a trade five times in a row, taking a small loss
each time, than take one large loss. Mark Minervini
1251
Most people just cannot weather the learning curve. As soon as it gets difficult, and
their approach isn't working up to their expectations, they begin to look for
something else. As a result, they become slightly efficient in many areas without
becoming very good in any single methodology. The reality is that it takes a very
long time to develop a superior approach, and along the way, you are going to go
through periods where you do poorly. Ironically, those are the periods that give you
the most valuable information. Mark Minervini
1250
First and foremost, understand that you will always make mistakes. The only way
to prevent mistakes from turning into disasters is to accept losses while they are
small and then move on. Mark Minervini
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1249
I constantly try to figure out how the market can trick or fool the majority of
investors. Then after the majority have been fooled I get in at what I call the 'point
of smooth sailing.' A so-called failed signal can actually be the beginning of a more
complex pattern that is far more reliable than the initial signal based on a
conventional pattern. Mark Minervini
1248
Let's say I buy a stock because of a signal and the market dips enough to stop meout. The stock then witnesses a huge reversal and closes near the high of the day.
That price action may be an indication that there was a shakeout, which knocked
out most of the weak hands, and the stock is ready to go up. Putting the long back
on at that point may well be a higher probability trade than the original trade. Mark Minervini
1247
You can't get beat if you have a great defense. I would always prefer to bet on a
football team that has a great defense as opposed to one that has a great offense.
If a trade doesn't work out quickly, I take a small loss, and I may have to take a
small loss many times. Mark Minervini
1246
The key is to know when to do nothing. Most people, even if they have a winning
strategy, will not follow it because they lack discipline. Mark Minervini
1245 I think that anyone who wants to be a trader should learn how to play poker. Mark Minervini
1244
My results were transformed when I understood that what counts isn't how often
you're right, but how much you profit on your winning trades versus how much you
lose on your losing trades. On average, I'm only profitable about 50 percent of thetime, but I make much more when I'm right than I lose when I'm wrong. Mark Minervini
1243
If you are a beginner, trade with an amount of money that is small enough so that
you can afford to lose it, but large enough so that you will feel the pain if you do.
Otherwise, you're fooling yourself. Mark Minervini
1242
It is much better to learn the lesson that you can lose everything when you don't
have that much money than to learn the same lesson later on. Mark Minervini
1241
Containing your losses is 90 percent of the battle, regardless of the strategy. In
addition, if you put yourself in a position to buy stocks that have the potential to go
up a lot, your odds will be better. Mark Minervini
1240
You have all these people trying to come up with formulas to beat the market. The
market is not a science. The science may help increase the probabilities, but to
excel you need to master the art of trading. Mark Minervini
1239
My basic philosophy is: Expose your portfolio to the best stocks that the market
has to offer and cut your losses very quickly when you're wrong. That one
sentence essentially describes my strategy. Mark Minervini
1238
The motivation is always the same. Although I may hold the position much longer, I
am buying the stock because I think it will go up within hours or at most days. Mark Minervini
1237
When you buy an option, the premium steadily evaporates over time. It's like
holding an ice cube in your hand: the longer it's there, the more it diminishes until
finally it doesn't exist at all. Mark Cook
1236Bad traders don't make profits — they only take out short-term loans from themarket. Wall Street proverb
1235 When the levee breaks, momma you got to move... Led Zeppelin
1234
When everything happens at once, wide and fast moving problems simply route
around any central authority. Therefore overall governance must arise from the
most humble interdependent acts done locally in parallel, and not from a central
command. Kevin Kelly
1233
The work of managing a natural environment is inescapably a work of local
knowledge. Kevin Kelly
1232 In turbulence is the preservation of the world. Kevin Kelly
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1231
The nature of life is to delight in all possible loopholes. Every creature is in some
way hacking a living by reinterpreting the rules. Kevin Kelly
1230 'It works, why worry?' is life's deepest philosophy. Kevin Kelly
1229 A network nurtures small failures in order that large failures don't happen as often. Kevin Kelly
1228
There is nothing to be found in a beehive that is not submerged in a bee. And yet
you can search a bee forever with cyclotron and fluoroscope, and you will neverfind a hive. Kevin Kelly
1227 Complexity must be grown from simple systems that already work. Kevin Kelly
1226
Hope should never be in your vocabulary. It is the worst four-letter word I know. As
soon as you say, 'Boy, I hope this position comes back,' you should reduce your
size. Mark Cook
1225
I would attribute my own success to having both conviction about my gut feelings
and the ability to act on them quickly. That is so critical. Stuart Walton
1224
When I talk to potential new investors I focus on my mistakes. Because if you are
going to invest with someone, you want that person to have made mistakes on his
own tab and not to make them on yours. Someone who has never made a mistake
is dangerous, because mistakes will happen. If you've made mistakes, you realize
they can recur, and it makes you more careful. Stuart Walton
1222
Hazarding guesses (extremely rough ones, for that matter) about the behavior of a
population has some meaning. It is, however, almost impossible to foresee the
behavior of an individual, even on a day-to-day basis. In the same way, thephysicist can prognosticate with great exactitude the time a gram of radium will
need to halve its activity but is totally unable to say when a single atom of that
same radium will disintegrate. Primo Levi
1221 Patience was still needed, in unforeseeable doses; yet more patience. Primo Levi
1220
This company looks cheap, that company looks cheap, but the overall economy
could completely screw it up. The key is to wait. Sometimes the hardest thing to do
is to do nothing. David Tepper
1219A foolish consistency is the hobgoblin of little minds. Ralph Waldo Emerson
1218 Give me a horse I can ride! John Facenda
1217
Sometimes the opportunities are so obvious that you almost can't lose when they
come around; the only problem is that they don't come around that often. The key
is not to lose money in the times in between. Stuart Walton
1216
My philosophy is to float like a jellyfish and let the market push me where it wants
to go. I don't draw a line in the sand and say this is my strategy and I'm going to
wait for the market to come to me. I try to figure out what strategies are working in
the market. Stuart Walton
1215
To me, the successful stock is not one that I bought at 10 and held to a 100, but
one where I picked up 7 points here, 5 points here, another 8 here, and caught a
major part of the move. Stuart Walton
1214
The theme I noticed back then that has persisted through bull and bear markets is:
Good companies, on balance, continue to go up. Grandmothers in Kansas Cityknow that. Stuart Walton
1213
I really admire people who do what they want to do and don't care about anything
else. I had a friend in college who was determined to be a rock and roll star. He
formed the band The Cowboy Junkies. When he started college, he couldn't even
play a guitar, and now he is sold out at every concert. Stuart Walton
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1199
The people who want to be recognized as the greatest traders are probably not the
greatest traders. Egos get in the way of the process. In my opinion, you never want
to be the largest player in the pit. Blair Hull
1198
In a sense, I owe everything that I have to the state of Nevada. It not only provided
me with my original trading stake, but the betting experience taught me a lot of
things that allowed me to become a successful trader. Blair Hull
1197If you get too careful about not risking your gains, you're not going to be able toextract a large profit. Mark Ritchie
1196
You need to have the courage to stand up against the crowd, decide your position,
and execute it. Mark Ritchie
1195
Magnitude of losses and profits is purely a matter of position size. Controlling
position size is indispensable to success. Of all the traits necessary to trade
successfully, this factor is the most undervalued. Mark Ritchie
1194
Understand that learning the markets can take years. Immerse yourself in the
world of trading and give up everything else. Get as close to other successful
traders as you can.
Linda Bradford
Raschke
1193 Fall down seven times, stand up eight. Japanese Proverb
1192
Part of the trading process is testing the water. If your entry timing is good enough,
you won't lose much even when you're wrong.
Linda Bradford
Raschke
1191
I think investment psychology is by far the most important element, followed by risk
control, with the least important consideration being the question of where you buy
and sell. Tom Basso
1190
I liken emotions in trading to a spring, with emotions being stretched up and down,
up and down. While it's going up and down, it's kind of thrilling, but eventually the
spring wears out. Burnout sets in, and you realize that maybe it isn't so much fun
to be on this emotional roller coaster. You find that if you can just keep your
emotions in balance in the middle, it's actually a whole lot more fun. Tom Basso
1189
I'm fond of thinking of trading in terms of scores of years. If I live long enough, I'll
trade for fifty or sixty years. I figure that, over that time span, I'll see devastating
declines, spectacular advances that I virtually can't believe, and everything in
between. Tom Basso
1188
After my years of experience in the markets, I now try to keep my models as
flexible as I possibly can. I try to imagine scenarios that would almost make good
movie plots. Tom Basso
1187
I know this will sound like a cliche, but the single most important reason that
people lose money in financial markets is that they don't cut their losses short. It is
a curiosity of human nature that no matter how many books talk about this rule,
and no matter how many experts offer this advice, people still keep making the
same mistake. Victor Sperandeo
1186
We are still a multimedia organism. If we want to push the envelope of complexity
further, we have to use all of our devices for accessing information — not all of
which are rational.
Mihaly
Csikszentmihalyi
1185
The ego falls away. Time flies. Every action, movement, and thought followsinevitably from the previous one, like playing jazz. Your whole being is involved,
and you're using your skills to the utmost.
Mihaly
Csikszentmihalyi
1184
Choiceless awareness is a quality of mind that is free from making judgments,
decisions or generating commentary as it meets with sense experiences. It is a
mind that responds to each new moment without the burden of its past history or
making future projections. Matthew Flickstein
1183
To watch the behavior of a man who acts not according to reason, but according to
his own deep impulses, is a spectacle of extreme interest, similar to that which the
naturalist enjoys when he studies the activities of an animal of complex instincts. Primo Levi
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1182
The ultimate result of shielding men from the effects of folly is to fill the world with
fools. Herbert Spencer
1181
In my opinion, the greatest misconception is the idea that if you buy and hold
stocks for long periods of time, you'll always make money. Victor Sperandeo
1180
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. Victor Sperandeo
1179
The key to trading success is emotional discipline. Making money has nothing to
do with intelligence. Think of all the bright people that choose careers on Wall
Street. If intelligence were the key, there would be a lot more people making
money trading. Victor Sperandeo
1178
Successful speculation implies taking risk when the odds are in your favor. Just
like in poker, where you have to know which hands to bet on, in trading you have
to know when the odds are in your favor. Victor Sperandeo
1177
The fact that we live at the bottom of a deep gravity well, on the surface of a gas-
covered planet going around a nuclear fireball 90 million miles away, and think this
to be normal, is obviously some indication of how skewed our perspective tends to
be. Douglas Adams
1176
A trading philosophy is something that cannot just be transferred from one person
to another, it's something that you have to acquire yourself through time and effort. Richard Driehaus
1175
The essential element is having a core philosophy. Without a core philosophyyou're not going to be able to hold on to your positions or stick with your trading
plan during really difficult times. You must fully understand, strongly believe in, and
be totally committed to your trading philosophy. Richard Driehaus
1174
Most people believe high turnover is risky, but I think just the opposite. High
turnover reduces risk when it's the result of taking a series of small losses in order
to avoid larger losses. I don't hold on to stocks with deteriorating fundamentals or
price patterns. For me, this kind of turnover makes sense. It reduces risk; it doesn't
increase it. Richard Driehaus
1173
The wonderful thing about our business is that it's liquid, and you can wipe the
slate clean on any day. As long as I'm in control of the situation — that is, as long
as I can cover my positions — there's no reason to be nervous. Stan Druckenmiller
1172
In secular bear markets, fighting general conditions is an expensive habit. Wall
Street is addicted to this habit by design. Jack Sparrow
1171 Survive and advance. Jim Valvano
1170
The more extensive a man's knowledge of what has been done, the greater will be
his power of knowing what to do. Benjamin Disraeli
1169 The secret of success is constancy of purpose. Benjamin Disraeli
1168 Nurture your mind with great thoughts; to believe in the heroic makes heroes. Benjamin Disraeli
1167 What we learn from history is that we do not learn from history. Benjamin Disraeli
1166
Wall Street ices the inefficient cake with compulsive conformity. Everyone gets on
the bandwagon and stays until the evidence is too compelling, then they all fall off
with a jolt.
The Art of Short
Selling
1165
Soros has taught me that when you have tremendous conviction on a trade, you
have to go for the jugular. It takes courage to be a pig. It takes courage to ride a
profit with huge leverage. As far as Soros is concerned, when you're right on
something, you can't own enough. Stan Druckenmiller
1164
I've learned many things from [George Soros], but perhaps the most significant is
that it's not whether you're right or wrong that's important, but how much money
you make when you're right and how much you lose when you're wrong. The few
times that Soros has ever criticized me was when I was really right on a market
and didn't maximize the opportunity. Stan Druckenmiller
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1163
The way to attain truly superior long-term returns is to grind it out until you're up 30
or 40 percent, and then if you have the convictions, go for a 100 percent year. If
you can put together a few near-100 percent years and avoid down years, then
you can achieve really outstanding long-term returns. Stan Druckenmiller
1162
George Soros has a philosophy that I have also adopted: The way to build long-
term returns is through preservation of capital and home runs. You can be far more
aggressive when you're making good profits. Stan Druckenmiller
1161
I never use valuation to time the market. I use liquidity considerations and
technical analysis for timing. Valuation only tells me how far the market can go
once a catalyst enters the picture to change the market direction. Stan Druckenmiller
1160
Frankly, even today, many analysts still don't know what makes their stocks go up
or down. Stan Druckenmiller
1159
The essential element is that the markets are ultimately based on human
psychology, and by charting the markets you're merely converting human
psychology into graphic representations. Al Weiss
1157
The most liquid period is the opening. Liquidity starts falling off pretty quickly after
the opening. The second most liquid time of day is the close. Trading volume
typically forms a U-shaped curve throughout the day. There's a lot of liquidity rightat the opening, it then falls off, reaching a nadir at midday, and then it starts to
climb back up, reaching a secondary peak on the close. Generally speaking, this
pattern holds in almost every market. It's actually pretty amazing. Monroe Trout
1156
The desire to maximize the number of winning trades (or minimize the number of
losing trades) works against the trader. The success rate of trades is the least
important performance statistic and may even be inversely related to performance. William Eckhardt
1155
The market behaves much like an opponent who is trying to teach you to trade
poorly... The market likes to lull you into the false security of high success rate
techniques, which often lose disastrously in the long run. The general idea is that
what works most of the time is nearly the opposite of what works in the long run. William Eckhardt
1154
When you're on a big winning streak, there's a temptation to think that you're doing
something special, which will allow you to continue to propel yourself upward. You
start to think that you can afford to make shoddy decisions. You can imagine what
happens next. As a general rule, losses make you strong and profits make you
weak. William Eckhardt
1153
While amateurs go broke by taking large losses, professionals go broke by taking
small profits. The problem in a nutshell is that human nature does not operate to
maximize gain but rather to maximize the chance of a gain. William Eckhardt
1152
One common adage on this subject that is completely wrongheaded is: You can't
go broke taking profits. That's precisely how many traders do go broke. William Eckhardt
1151
Watch idly while profit-taking opportunities arise, but in adversity run like a
jackrabbit. William Eckhardt
1150
Anyone with average intelligence can learn to trade. This is not rocket science.
However, it's much easier to learn what you should do in trading than to do it.
Good systems tend to violate normal human tendencies. Of the people who can
learn the basics, only a small percentage will be successful traders. William Eckhardt
1149 To conquer fate, go ahead and meet it. Dickson G. Watts
1148
I haven't seen much correlation between good trading and intelligence. Some
outstanding traders are quite intelligent, but a few aren't. Many outstandingly
intelligent people are horrible traders. Average intelligence is enough. Beyond that,
emotional makeup is more important. William Eckhardt
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1147
Trading size is one aspect you don't want to optimize. The optimum comes just
before the precipice. William Eckhardt
1146
The desire to find patterns is the same human quirk that convinces people that
there is validity in superstitions, or astrology, or fortune tellers. The successes are
much more startling than the failures. You remember the times when the oracle
really hit the nail on the head, and you tend to forget the cases in which the
prediction was ambiguous or wrong. William Eckhardt
1145
The human mind was made to create patterns. It will see patterns in random data.
A turn-of-the-century statistics book put it this way: 'Too fine an eye for pattern will
find it everywhere.' William Eckhardt
1144
As a general rule, be very skeptical of your results. The better a system looks, the
more adamant you should be in trying to disprove it. This idea goes very much
against human nature, which wants to make the historical performance of a system
look as good as possible. William Eckhardt
1143
The lack of intrinsic meaning of angles on a bar chart has significance even for
chart-oriented traders who do not employ angles. How sharply a trend slopes on a
chart is often a psychological consideration in making a trade. If you fall prey to
this influence, you're letting the chart maker's practical and aesthetic
considerations impinge on your trading. Any trend can be made to look eithergentle or steep by adjusting the price scale. William Eckhardt
1142
In general, the delicate tests that statisticians use to squeeze significance out of
marginal data have no place in trading. We need blunt statistical instruments,robust techniques. William Eckhardt
1141
Sometimes the reason people lose is that they're not sufficiently selective. Upon
analysis, a trader may find that if he only concentrates on the trades that do well
and lets go of the other types of trades, he might actually be successful. Randy McKay
1140
One very interesting thing I've found is that virtually every successful trader I know
ultimately ended up with a trading style suited to his personality. Randy McKay
1139
When you're trading well, you have a better mental attitude. When you're trading
poorly, you start wishing and hoping. Instead of getting into trades you think will
work, you end up getting into trades you hope will work. Randy McKay
1138
The most important advice is to never let a loser get out of hand... I'll keep on
reducing my trading size as long as I'm losing. I've gone from trading as many as
three thousand contracts per trade to as few as ten when I was cold, and then
back again. Randy McKay
1137
One of the things I did that worked in those early years was analyzing every single
trade I made. Every day, I made copies of my cards and reviewed them at home.
Every trader is going to have tons of winners and losers. You need to determine
why the winners are winners and the losers are losers. Once you can figure that
out, you can become more selective in your trading and avoid those trades that are
more likely to be losers. Randy McKay
1136
You don't want to have a position before a move has started. You want to wait until
the move is already under way before you get into the market. Randy McKay
1135
The beginning of a price move is usually hard to trade because you're not sure
whether you're right about the direction of the trend. The end is hard because
people start taking profits and the market gets very choppy. The middle of the
move is what I call the easy part. Randy McKay
1134
So many people want the positive rewards of being a successful trader without
being willing to go through the commitment and pain. And there's a lot of pain. Bill Lipschutz
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1133
It's not enough to simply have the insight to see something apart from the rest of
the crowd, you also need to have the courage to act on it and to stay with it. It's
very difficult to be different from the rest of the crowd the majority of the time,
which by definition is what you're doing if you're a successful trader. Bill Lipschutz
1132
The really best traders don't think twice about how many hours they're working or
whether they come in on a weekend. There's no substitute for that level ofcommitment. Bill Lipschutz
1131
[Superior] traders have tremendous commitment to the markets — to their craft, so
to speak. They develop scenarios, reevaluate scenarios, collect information, and
reevaluate that information. They constantly ask themselves: What am I doing
right? What am I doing wrong? How can I do what I am doing better? How can I
get more information? It's obsessive. Bill Lipschutz
1130
...playing out scenarios is something that I do all the time. That is a process a
fundamental trader goes through constantly. What if this happens? What if this
doesn't happen? How will the market respond? What levels will the market move
to? Bill Lipschutz
1129
I don't have a problem letting my profits run, which many traders do. You have tobe able to let your profits run. I don't think you can consistently be a winning trader
if you're banking on being right more than 50 percent of the time. Bill Lipschutz
1128
You have to trade at a size such that if you're not exactly right in your timing, youwon't be blown out of your position. My approach is to build to a larger size as the
market is going my way. Bill Lipschutz
1127
Foreign exchange is a very psychological market... if you move the market 4
percent, for example, you're probably going to change the market psychology for
the next few days. Bill Lipschutz
1126
When you're in a losing streak, your ability to properly assimilate and analyze
information starts to become distorted because of the impairment of the confidence
factor, which is a by-product of a losing streak. You have to work very hard to
restore that confidence, and cutting back trading size helps achieve that goal. Bill Lipschutz
1125
There are a lot of elements to risk control: Always know exactly where you stand.
Don't concentrate too much of your money on one big trade or group of highly
correlated trades. Always understand the risk-reward of the trade as it now stands,
not as it existed when you put the position on. Bill Lipschutz
1124
Not everyone is going to interpret things in the same way, at the same time, as you
do, and it's important to understand that. You need to be plugged into the news
and to know what the market is looking at. For example, one day the foreign
exchange market may be focusing on interest rate differentials; the next day the
market may be looking at potential for capital appreciation, which is exactly the
opposite. Bill Lipschutz
1123
We cannot grow without challenge. Challenges routinely produce crises that
severely test us. However, crises also offer us the greatest opportunities. Steven Callahan
1122
...voyaging through wildernesses, be they full of woods or waves, is essential to
the growth and maturity of the human spirit. It is in the wilderness that you really
learn who you are. It is in facing the challenges of the wilderness that the thickness
of your wallet becomes irrelevant and your capabilities become the truer measure
of your value. Steven Callahan
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1121
The freedom of the sea lures men, yet freedom does not come free. Its cost is the
loss of the security of life on land. When a storm is brewing, the sailor cannot
simply park his ship and walk away from it. He cannot hide within stone walls until
the whole thing blows over. There is no freedom from nature, the power that binds
even the dead together. Sailors are exposed to nature's beauty and her ugliness
more intensely than most men ashore. I have chosen the sailor's life to escape
society's restrictions and I have sacrificed its protection. I have chosen freedomand I have paid the price.
Adrift: 76 Days Lost AtSea
1120
The most appropriate description of man as differentiated from nonhuman beings
is: a being purposively struggling against the forces adverse to his life. Ludwig Von Mises
1119
There are many who find a good alibi far more attractive than an achievement. For
an achievement does not settle anything permanently. We still have to prove our
worth anew each day; we have to prove that we are as good today as we were
yesterday. But when we have a valid alibi for not achieving anything we are fixed,
so to speak, for life. Eric Hoffer
1118 Most battles are won before they are ever fought.
General George S.
Patton
1117 Life shrinks or expands in proportion to one's courage. Anais Nin
1116
Reason's biological function is to preserve and promote life and to postpone itsextinction as long as possible. Thinking and acting are not contrary to nature; they
are, rather, the foremost features of man's nature. Ludwig Von Mises
1115
You've got to think about doing big things while you're doing small things, so all thesmall things go in the right direction. Alvin Toffler
1114
When you really believe that trading is simply a probability game, concepts like
'right' and 'wrong' or 'win' and 'lose' no longer have the same significance. As a
result, your expectations will be in harmony with the possibilities. Mark Douglas
1113
How much heat can you stand? Money management is a thermostat — a control
system for risk that keeps your trading within the comfort zone. Gibbons Burke
1112
Everyone has talent. What is rare is the courage to follow the talent to the dark
place where it leads. Erica Jong
1111
Take your life in your own hands and what happens? A terrible thing: no one to
blame. Erica Jong
1110 If you don't risk anything, you risk even more. Erica Jong
1109
The biggest cause of trouble in the world today is that the stupid people are so
sure about things and the intelligent folks are so full of doubts. Bertrand Russell
1108 You will run out of money before a guru runs out of indicators. Neil Weintraub
1107 I have no special talents. I am only passionately curious. Albert Einstein
1106 Everyone's entitled to their own opinion, but they're not entitled to their own facts. Donald Rumsfeld
1105
Do not believe in anything simply because you have heard it. Do not believe in
anything simply because it is spoken and rumored by many. Do not believe in
anything simply because it is found written in your religious books. Do not believe
in anything merely on the authority of your teachers and elders. Do not believe intraditions because they have been handed down for many generations. But after
observation and analysis, when you find that anything agrees with reason, and is
conducive to the good and benefit of one and all, then accept it and live up to it. Siddhartha Gautama
1104
500 fights, that's the number I figured when I was a kid. 500 street fights and you
could consider yourself a legitimate tough guy. You need 'em for experience. To
develop leather skin. So I got started. Of course, along the way you stop thinking
about being tough and all that. It stops being the point. You get past the silliness of
it all. But then, after, you realize that's what you are. Knockaround Guys
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1103
If you can preserve your financial and mental capital when others have depleted or
squandered theirs, the long-term rewards will be great. Jack Sparrow
1102
The illiterate of the 21st century will not be those who cannot read and write, but
those who cannot learn, unlearn, and relearn. Alvin Toffler
1101 Reason is the main resource of man in his struggle for survival. Ludwig Von Mises
1100
It may be readily conceived that if men passionately bent upon physical
gratifications desire greatly, they are also easily discouraged; as their ultimateobject is to enjoy, the means to reach that object must be prompt and easy or the
trouble of acquiring the gratification would be greater than the gratification itself.
Their prevailing frame of mind, then, is at once ardent and relaxed, violent and
enervated. Death is often less dreaded by them than perseverance in continuous
efforts to one goal. Alexis de Tocqueville
1099 Fat, drunk and stupid is no way to go through life, son. Animal House
1098
When I started writing I thought if I proved X was a stupid thing to do that people
would stop doing X. I was wrong. Bill James
1097
It seems LTCM could have survived one Nobel prize-winner, but with two, they
were doomed. Frederic Townsend
1096
The success of options valuation is the story of a simple, asymptotically correct
idea, taken more serious than it deserved, and then used extravagantly, withhubris, as a crutch to human thinking. Emanuel Derman
1095 Success demands singleness of purpose. Vince Lombardi
1094
If all it took to beat the markets was a P.h.D in mathematics, there'd be a hell of alot of rich mathematicians out there. Bil Dries
1093
The class of those who have the ability to think their own thoughts is separated by
an unbridgeable gulf from the class of those who cannot. Ludwig Von Mises
1092 It is a capital mistake to theorize before one has data. Sir Arthur Conan Doyle
1091 Losing an illusion makes you wiser than finding a truth. Ludwig Borne
1090
Portfolio structuring, risk management, execution strategies, capital management,
and leverage management may not be directly connected to the algorithm that
generates the buy and sell signals, but they are all hugely important. Bruce Cleland
1089
The mathematics are very important, but it's only one piece of the puzzle. The
most important thing overall is the total investment process, of which the signal
generator is an important part. Bruce Cleland
1088 Measure what is measurable, and make measurable what is not so. Galileo Galilei
1087
The difference between a successful person and others is not a lack of strength,
not a lack of knowledge, but rather a lack of will. Vince Lombardi
1086
Pyramiding instructions appear on dollar bills. Add smaller and smaller amounts on
the way up. Keep your eye open at the top. Ed Seykota
1085 Everything flows. Heraclitus
1084 Life is a school of probability. Walter Bagehot
1083
We have made our business managing risk. We are comfortable with risk and we
get our reward from risk. John W. Henry
1082
Since investors are human and make mistakes, they're never 100% sure of their
vision and whether or not their view is correct. So price adjustments take time as
they fluctuate and a new consensus is formed in the face of changing market
conditions and new facts. For some changes this consensus is easy to reach, but
there are other events that take time to formulate a market view. It's those events
that take time that form the basis of our profits. John W. Henry
1081 Man's expectations manifest in trends. John W. Henry
1080 Money management is the true survival key. Bill Dunn
1079 The beginning is the most important part of the work. Plato
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1078 Free markets will always find their own means of price discovery. Keith Campbell
1077
Government regulation and intervention have been, are, and will continue to be
present for as long as society needs rules by which to live. Today's governmental
intervention or decree is tomorrow's opportunity. Keith Campbell
1076
The people that I know who are the most successful at trading are passionate
about it. They fulfill what I think is the first requirement: developing intuitions aboutsomething they care about deeply, in this case, trading... They develop a deep
knowledge of whatever form of analysis they use. Out of that passion and
knowledge, their trading ideas, insights, and intuitions emerge. Charles Faulkner
1075
My dear, one can make just as much money from the destruction of a civilization
as from the building of it. Gone With the Wind
1074
There is nothing more difficult to take in hand, more perilous to conduct, or more
uncertain in its success, than to take the lead in the introduction of a new order of
things. Niccolo Machiavelli
1073
Speculation [is] dealing with the uncertain conditions of the unknown future. Every
human action is a speculation in that it is embedded in the flux of time. Ludwig Von Mises
1072To be aware how fruitful the playful mood can be is to be immune to thepropaganda of the alienated, which extols resentment as a fuel of achievement. Eric Hoffer
1071 Fish see the bait, but not the hook; men see the profit, but not the peril. Chinese proverb
1070
Education rears disciples, imitators, and routinists, not pioneers of new ideas andcreative geniuses. The schools are not nurseries of progress and improvement,
but conservatories of tradition and unvarying modes of thought. Ludwig Von Mises
1069
You have to stop trying to will things to happen in order to prove that you're right.
Listen only to what the market is telling you now. Forget what you thought it was
telling you five minutes ago. The sole objective of trading is not to prove you're
right, but to hear the cash register ring. Marty Schwartz
1068
Trading is a psychological game. Most people think that they're playing against the
market, but the market doesn't care. You're really playing against yourself. Marty Schwartz
1067
If the market gets negative news and the market shrugs it off and it continues to go
up, this is a bullish reaction because it means the market has already discounted
the news. On the other hand, a sign of a fully priced market is one that reacts
poorly to good news. Marty Schwartz
1066
Technical indicators that show me low-risk entry points for high probability trades
are at the core of my methodology. But I am always intensely searching for
patterns, setups, recurring themes, no matter how small, to help further swing the
odds in my favor on a given trade. Marty Schwartz
1065
When I was in the first grade, the teacher asked each of us what we wanted to be
when we grew up. I said, 'a detective.' This investigative nature has carried
through into adulthood. I love searching for clues, synthesizing tons of unrelated
data, and arriving at a logical conclusion. While these observations are not entirely
scientific, they are things I've seen repeatedly over the years. Marty Schwartz
1064
Your trading methodology has to fit your personality. You have to understand your
strengths and your weaknesses. It took me nine years to figure myself out. Marty Schwartz
1063
When you're in a losing position and you're brainlocked, do whatever's necessary
to help clear your head. Whether you're a pro or an amateur, you cannot lose your
objectivity. Marty Schwartz
1062
Wall Street doesn't want to see the emperor naked. He may be old and fat and
flabby, but they don't want to know it. They want to see him regal and royal in all
his majesty. And as long as they see him that way, that's the way he is, because
they keep on buying. Big ball keep on rolling. Marty Schwartz
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1061
It behooves those who are genetically predisposed to a bearish position to
remember that markets have a logic of their own. John Mauldin
1060
Don't get in a shootout if you've left your guns at home. The markets are no place
to be trying to impress people. The only way to impress anybody is to stay on your
toes, be consistent, and trade within your means. Marty Schwartz
1059
When you're trading, it's important to have your guns on. You can't be wandering
around the Street unarmed, and if you don't know the terrain, you're going to getkilled. Marty Schwartz
1058
A great trader is like a great athlete. You have to have natural skills, but you have
to train yourself how to use them. Marty Schwartz
1057
You will never be more objective than before you execute a trade. Once you are in
a trade, emotions take over, so your plan must be in place beforehand. Marty Schwartz
1056
Trading must be addressed as a profession, because if you do not treat it as such,
those who do will separate you from your money very quickly. Marty Schwartz
1055 I went to a fight the other day and wound up trading futures in Chicago. Wall Street proverb
1054
The more you lose in a trade, the less objective you become. Exiting a losing trade
quickly clears your head and restores your objectivity. After a breather, you might
put the same trade back on if you can intellectually justify it, but you have toconstantly remind yourself that there's a myriad of opportunities in the
marketplace. By preserving your capital through the use of a stop, you make it
possible to wait patiently for a high-probability trade with a low-risk entry point. Marty Schwartz
1053
A stop automatically takes your brain out of reverse and puts it into neutral. Your
money's not back to neutral, but your mind's back to the point where you can
regroup and try to think up a fresh idea without the pressure of a losing position
hanging over your head. Marty Schwartz
1052
Whenever you have jealousy as an emotion, or greed, or envy, it distorts your
judgment. The market's like the bleached blonde in Vegas. It doesn't care about
you. That's why you have to put aside your ego and get out. If you have trouble
doing that, as most people do, be like Odysseus; tie yourself to the mast with an
automatic stop and take your emotions out of play. Marty Schwartz
1051
What most people fail to understand is that while you're losing your money, you're
also losing your objectivity. It's like being at the craps table in Vegas, and the fat
bleached blonde in the sequined dress is rolling the dice, and you're losing, and
you're determined that you're not going to let her beat you. What you've forgotten
is that she doesn't care about you, she's just rolling the dice. Marty Schwartz
1050
Taking a loss is hard to do because it's an admission that you've been wrong. But
in the market, being wrong some of the time is part of the game. On each trade,
you have to establish your 'uncle point,' the point where you'll get out of a losing
position, and you have to have the mental discipline to pull the trigger at that point. Marty Schwartz
1049 There's no cure for fools. Yojimbo
1048Confidence is every part of trading. If you're not convinced that you can win, youshould never climb into the ring. Marty Schwartz
1047
For two hundred days a year, I'd end up with reasonably small losses netted out
with similar-sized gains. Lose $5,000 here, make $6,000 there, round after round,
twenty, thirty, forty times a day. But I'd win the other fifty trading days by clear-cut
unanimous decisions. Smack the bonds for $75,000, hit a stock for $100,000, nail
a couple of options for $125,000, pound the S&Ps for $150,000. Over time it made
me a big winner, to the tune of $5 million a year. Marty Schwartz
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1046
The most important thing is to protect your trading capital until you can regain your
equilibrium and put all the shadows of the losing streak behind you. Losing streaks
are an unfortunate part of the game, but if you are a good disciplined trader who
can shift into neutral, the losing will end and black ink will start to flow again. Marty Schwartz
1045
When I came back, I'd see a trade I liked and I'd do it small with a very tight stop,
so if I was wrong, I'd get right out. All the time I kept telling myself, make littleprofits, make little profits, make little profits. Black ink, black ink, black ink. It's all
psychological. Marty Schwartz
1044
You can never shift from reverse to first gear without going through neutral. You
must change the direction of bad trading by first shifting to neutral. You must stop. Marty Schwartz
1043
The best way to stop a losing streak is to stop! Stop the losses, stop the bleeding.
Take time off and let your intellect take charge of your emotions; the market will be
there when you return. Marty Schwartz
1042
The best way to end a losing streak is to cut your losses and divorce your ego from
the game... You have to manage your resources and not lose too much of your
stake. Many people when they're losing increase their bets; they double up hopingto win it all back on one roll of the dice. That strategy can be devastating. Marty Schwartz
1041
When you're a market timer, you have to be equally good at going short and going
long, and when the market changes sides, you can't hold your position and hope itturns around. If you're not a natural like Mickey Mantle, you've got to be a student
of the game like Rod Carew. Practice, practice, practice. Marty Schwartz
1040
Because we make and lose thousands of dollars every day, big-time traders often
give the appearance of treating money with an 'easy come, easy go' attitude.
That's not right. Just because we don't do the mashed potatoes over our wins or
whine about our losses doesn't mean that we take them casually. Marty Schwartz
1039
When you're trading real time, and things start popping, you're challenged to make
immediate decisions. You can't stand still, there's no time to think. It's attack or
retreat, increase the position or get out. Marty Schwartz
1038
That's the basic difference between an investor and a trader. A trader looks at the
market as one living, breathing organism instead of a collection of individual
stocks. Marty Schwartz
1037
The only real security that a man will have in this world is a reserve of knowledge,
experience, and ability. Henry Ford
1036
I've found that people who are great at something are not so much convinced of
their own greatness as mystified at why everyone else seems so incompetent. Paul Graham
1034
Academic assertions that outperformance is impossible pose a useful sort of litmus
test. If one is cowed enough by the dogma to accept mediocrity as inevitable, then
one most likely lacks the drive, the talent or the intellect (or some combination of
the three) to achieve excellence in the first place. Jack Sparrow
1033 Develop a built-in bullshit detector. Ernest Hemingway1032 Never mistake motion for action. Ernest Hemingway
1031 There is great disorder under heaven... the situation is excellent. Chairman Mao
1030
For the great majority of mankind are satisfied with appearances, as though they
were realities. Niccolo Machiavelli
1029
The enemy advances, we retreat; the enemy camps, we harass; the enemy tires,
we attack; the enemy retreats, we pursue. Chairman Mao
1028
The realization that you are responsible for the results you get is the key to
successful investing. Winners know they are responsible for their results; losers
think they are not. Van Tharp
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1027
I'm not saying that controlling your mental state is the magic solution to trading
success. It's just part of the answer. But when you admit that the answer is within
yourself, you've come a long way. Van Tharp
1026
Always respect the marketplace. Never take anything for granted. Do your
homework. Recap the day. Figure out what you did right and what you did wrong.
That is one part of the homework; the other part is projective. What do I want tohappen tomorrow? What happens if the opposite occurs? What happens if nothing
happens? Think through all the 'what-ifs.' Anticipate and plan, rather than react. Tony Saliba
1025
Discipline is number one: Take a theory and stick with it. But you also have to be
open-minded enough to switch tracks if you feel that your theory has been proven
wrong. You have to be able to say, 'My method worked for this type of market, but
we are not in that type of market anymore.' Tony Saliba
1024
How do you lose money? It's either a bad day trading or a losing position. If it's a
bad position that is the problem, then you should just get out of it. Tony Saliba
1023
...the best traders have no ego. To be a great trader, you have to have a big
enough ego only in the sense that you have confidence in yourself. You cannot let
ego get in the way of a trade that is a loser; you have to swallow your pride and get
out. Tom Baldwin
1022
Trading is like any other job. You work hard, put in the time and effort, and make
your own luck. I was lucky that the first 100-lot I sold was a winner. But why was Ilucky? Because I stood there all day for over six months, developing and honing
market feeling. When the opportunity occurred, I didn't hesitate. Tom Baldwin
1021
Most important, losers don't work hard enough. Most people walk in and think
there is a 50/50 chance on any trade. They don't think there is anything more to it
than that. They don't concentrate. They don't watch the factors that affect the
market. You can see it in their eyes; it is almost as if there is a wall in front of their
face. Tom Baldwin
1020 I'm not afraid to lose. When you start being afraid to lose, you're finished. Brian Gelber
1019
Most traders who fail have large egos and can't admit that they are wrong. Even
those who are willing to admit that they are wrong early in their career can't admit it
later on. Also, some traders fail because they are too worried about losing. Brian Gelber
1018
I'm not picky about how I make my money. It doesn't matter if my opinion is right or
wrong. All that matters is whether I make money. Brian Gelber
1017
I know educated people who watch the news and wonder why the hell they lost
money when everyone else is taking profits. The media owes it to the public to
report that the market goes down not only on profit taking, but on a lot of loss
taking as well. Mark Weinstein
1016
You have to learn how to lose; it is more important than learning how to win. If you
think you are always going to be a winner, when you lose, you will develop feelings
of hostility and end up blaming the market instead of trying to learn why you lost. Mark Weinstein
1015
Your strategy has to be flexible enough to change when the environment changes.
The mistake most people make is they keep the same strategy all the time. They
say, 'Damn, the market didn't behave the way I thought it would.' Why should it?
Life and the markets just don't work that way. Mark Weinstein
1014
Don't trade until an opportunity presents itself. Knowing when to stay out of the
markets is as important as knowing when to be in them. Mark Weinstein
1013 Be your own person. Think against the herd, as they must lose in time. Mark Weinstein
1012
Don't be arrogant. When you get arrogant, you forsake risk control. The best
traders are the most humble. Mark Weinstein
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1011
Another item I would place under the category of misconceptions is the way the
media reports the reasons for the market being down. They are always saying the
market is down because of profit taking. I think it would be wonderful if everybody
was always taking profits. But, the truth is, most people lose money, and the
reason markets go down is because they take their losses. Mark Weinstein
1010
I don't try to figure out where the market is going before the action; I let the markettell me where it is going. Also, there is such a variety of technical input in the stock
market... that you will almost always get a signal before the market is about to do
something. Mark Weinstein
1009
I am always looking for a market that is losing momentum, and then go the other
way. Mark Weinstein
1008
When I trade at home, I often watch the sparrows in my garden. When I feed them
bread, they take just a little piece at a time and fly away. They keep on flying back
and forth, taking small bits of bread. They may have to make a hundred stabs at a
piece of bread to get what a pigeon gets at one time, but that is why a pigeon is a
pigeon. You will never be able to shoot a sparrow, it is just too fast. Mark Weinstein
1007
Although the cheetah is the fastest animal in the world and can catch any animalon the plains, it will wait until it is absolutely sure it can catch its prey. It may hide in
the bush for a week, waiting for just the right moment. It will wait for a baby
antelope, and not just any baby antelope, but preferably one that is also sick orlame. Only then, when there is no chance it can lose its prey, does it attack. That,
to me, is the epitome of professional trading. Mark Weinstein
1006
Most people will not wait for the environment to tip itself off. They will walk into the
forest when it is still dark, while I wait until it gets light. Mark Weinstein
1005
My fear of the markets has forced me to hone my timing with great precision.
When I am trading properly, it is like a pool player running racks. If my gut feel of
market conditions is not right, I don't trade. Mark Weinstein
1004
I just wait until there is money lying in the corner, and all I have to do is go over
there and pick it up. I do nothing in the meantime. Even people who lose money in
the market say, 'I just lost my money, now I have to do something to make it back.'
No, you don't. You should sit there until you find something. Jim Rogers
1003
I always try to encourage people that are thinking of going into this business for
themselves. I tell them, 'Think that you might become more successful than you
ever dreamt, because that's what happened to me.' Marty Schwartz
1002
I always take my losses quickly. That is probably the key to my success. You can
always put the trade back on, but if you go flat, you see things differently. Marty Schwartz
1001
If you're ever very nervous about a position overnight, and especially over a
weekend, and you're able to get out at a much better price than you thought
possible when the market trades, you're usually better off staying with the position. Marty Schwartz
1000
The most important thing is money management, money management, money
management. Anybody who is successful will tell you the same thing. Marty Schwartz
999
The great thing about being a trader is that you can always do a much better job.
No matter how successful you are, you know how many times you screw up. Most
people, in most careers, are busy trying to cover up their mistakes. As a trader,
you are forced to confront your mistakes because the numbers don't lie. Marty Schwartz
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998
After a devastating loss, I always play very small and try to get black ink, black ink.
It's not how much money I make, but just getting my rhythm and confidence back. I
shrink my size totally — to a fifth or a tenth of the position that I trade normally.
And it works. I think I ended up losing only $57,000 in November 1982, after taking
a $600,000 hit on November 4. Marty Schwartz
997
By living the philosophy that my winners are always in front of me, it is not so
painful to take a loss. If I make a mistake, so what! Marty Schwartz
996
Before, admitting I was wrong was more upsetting than losing the money. I used to
try to will things to happen. I figured it out, therefore it can't be wrong. When I
became a winner, I said, 'I figured it out, but if I'm wrong, I'm getting the hell out,
because I want to save my money and go on to the next trade. Marty Schwartz
995
My attitude is that I always want to be better prepared than someone I'm
competing against. The way I prepare myself is by doing my work each night. Marty Schwartz
994
If you try to learn from every single trade that you make, you are only going to get
better and better as time goes on. David Ryan
993
In physics you're playing against God, and he doesn't change his laws very often.
In finance you're playing against God's creatures, agents who value assets based
on their ephemeral opinions. They don't know when they've lost, so they keeptrying. Emanuel Derman
992 You need to be decisive, open-minded, flexible and competitive. Stan Druckenmiller
991 You miss 100% of the shots you don't take. Wayne Gretzky
990
The highest compliment that you can pay me is to say that I work hard every day,
that I never dog it. Wayne Gretzky
989 I skate to where the puck is going to be, not where it has been. Wayne Gretzky
988
The stock market is neither efficient nor random. It is not efficient because there
are too many poorly conceived opinions; it is not random because strong investor
emotions can create trends. William O' Neill
987
High volume at a key point is an extraordinarily valuable tip-off that a stock is ready
to move. Volume can also be used in a reverse manner. When prices enter a
consolidation after an advance, volume should dry up very substantially. In other
words, there should be very little selling coming into the market. During a
consolidation, declining volume is generally constructive. William O' Neill
986
Just as a doctor would be foolish not to use X-rays and EKGs, investors would be
foolish not to use charts. Charts provide valuable information about what is going
on that cannot be obtained easily any other way. They allow you to follow a huge
number of different stocks in an organized manner. William O' Neill
985
Letting losses run is the most serious mistake made by most investors. The public
doesn't really understand the philosophy of cutting losses quickly. William O' Neill
984
The secret for winning in the stock market does not include being right all the time.
In fact, you should be able to win even if you are right only half the time. The key is
to lose the least amount of money possible when you are wrong. William O' Neill
983
My philosophy is that all stocks are bad. There are no good stocks unless they go
up in price. If they go down instead, you have to cut your losses fast. William O' Neill
982
There should be a respect for the person on the other side of the trade. Always ask
yourself: Why does he want to sell? What does he know that I don't? Finally, you
have to be intellectually honest with yourself and others. In my judgment, all great
traders are seekers of truth. Michael Steinhardt
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969
[Poker is] a very simple game; a five-year-old can learn it. But it's also highly
mathematical. If you never play someone on the next level, you don’t even know
that level exists. It's almost another dimension. Chip Reese
968
I have two basic rules about winning in trading as well as in life: (1) If you don't bet,
you can't win. (2) If you lose all your chips, you can't bet. Larry Hite
967
When I was a kid and got my first motorcycle, I had an older friend who would
always get into fights. He told me, 'Larry, when you are on a motorcycle, neverargue with a car. You will lose.' The same lesson applies to trading: If you argue
with the market, you will lose. Larry Hite
966
There are really four kinds of trades or bets: good bets, bad bets, winning bets,
and losing bets. Most people think that a losing trade was a bad bet. That is
absolutely wrong. You can lose money even on a good bet. If the odds on a bet
are 50/50 and the payoff is $2 versus a $1 risk, that is a good bet even if you lose.
The important point is that if you do enough of those trades or bets, eventually you
have to come out ahead. Larry Hite
965
Risk is a no-fooling-around game; it does not allow for mistakes. If you do not
manage the risk, eventually they will carry you out. Larry Hite
964
I have a friend who has amassed a fortune in excess of $100 million. He taught me
two basic lessons. First, if you never bet your lifestyle, from a trading standpoint,nothing bad will ever happen to you. Second, if you know what the worst possible
outcome is, it gives you tremendous freedom. The truth is that, while you can't
quantify reward, you can quantify risk. Larry Hite
963
There is a very important message here: People don't change. That is why this
whole game works. Larry Hite
962
I have a friend who is an economist. He would try to explain to me, as if talking to a
child, why what I was trying to do was futile, because 'the markets are efficient.' I
have noticed that everyone who has ever told me that the markets are efficient is
poor. Larry Hite
961
For some reason, the idea of trading on 5 percent margin made perfect sense to
me. Larry Hite
960
I know several people who claim to have market insights during dreams. I think
one of the functions of dreams is to reconcile information and feelings which the
conscious mind finds intractable. Ed Seykota
959
It is a happy coincidence that when nature gives us true burning desires, she also
gives us the means to satisfy them. Those who want to win and lack skill can get
someone with skill to help them. Ed Seykota
958
It's not how close you get to the ground, but how precise can you fly the airplane. If
you feel so careless with your life that you want to be the world's lowest flying
aviator, then you might do it for a while — but then a great many former friends of
mine are no longer with us, simply because they cut their margins too close. Bob Hoover
957 There are few activities so enlightening as to read old books with new eyes. Jack Sparrow
956
Trading is a curious mix of mostly going with the flow, yet knowing when to
selectively fade the flow. Jack Sparrow955 Being contrarian at the wrong time is akin to arguing with a herd of cattle. Jack Sparrow
954
I think that if people look deeply enough into their trading patterns, they find that,
on balance, including all their goals, they are really getting what they want, even
though they may not understand it or want to admit it. Ed Seykota
953
Win or lose, everybody gets what they want out of the market. Some people like to
lose, so they win by losing money. Ed Seykota
952
Psychology motivates the quality of analysis and puts it to use. Psychology is the
driver and analysis is the road map. Ed Seykota
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951
A losing trader can do little to transform himself into a winning trader. A losing
trader is not going to want to transform himself. That's the kind of thing winning
traders do. Ed Seykota
950
[Traders fail] for the same reason that most baby turtles fail to reach maturity:
Many are called and few are chosen. Society works by the attraction of the many.
As they are culled out, the good ones are left, and the others are released to go try
something else until they find their calling. The same is true for other fields ofpursuit. Ed Seykota
949
One alternative [to expensive drama] is to keep bets small and then to
systematically keep reducing risk during equity drawdowns. That way you
approach your safe money asymptotically and have a gentle emotional and
financial touchdown. Ed Seykota
948
The joy of winning and the pain of losing are right up there with the pain of winning
and the joy of losing. Also to consider are the joy and pain of not participating. The
relative strengths of these feelings tend to increase with the distance of the trader
from his commitment to being a trader. Ed Seykota
947
'Luck' or 'smarts' or 'gift' are words indicating an attitudinal proclivity for mastery.
One tends to do well at one's calling. I think most good traders have a little extra
spark about trading. Ed Seykota
946
Luck plays an enormous role in trading success. Some people were lucky enough
to be born smart, while others were even smarter and got born lucky. Ed Seykota
945
Good traders have a special talent for trading just as good musicians and goodathletes have talents for their fields. Great traders are ones who are absorbed by
the talent. They don't have the talent — the talent has them. Ed Seykota
944
Gold tends to be dug up, refined, and then buried again. The geographical entropy