- Buy low, sell high! That's the shortcut to a fortune, right? Wrong! It is just one of the many loss-causing cliches that the crowd chants as they lose money year after year.
-Stan Weinstein
-William O’Neil
- Forget the adage buy low and sell high.
-William O’Neil
- One market paradigm that I take exception to is: Buy low and sell high. I believe that far more money is made buying high and selling at even higher prices. That means buying stocks that have already had good moves and have high relative strength-that is, stocks in demand by other investors.
- Working to anticipate the future can be a distraction from the important task of dealing with the present.
- The Dow Jones Industrial Average in 1966 was 1000. In 1982 the average was below 800. Sixteen years later it had fallen 20 percent, and that is not adjusting for inflation – and those sixteen years were the worst sixteen-year period of inflation in American history. Well, first of all, so much for long-term investing.
- The true goal of a sharp speculator: to grab and ride the meaty or the significant part of a trending move.
- Monitor yourself constantly and minimize the number of mistakes you make. I define a mistake as not following your rules. Thus for many people who have no written rules, everything they do is a mistake.
-Van
K. Tharp
- In fact, the degree by which you think you know, assume you know, or in any way need to know what is going to happen next, is equal to the degree to which you will fail as a trader.
-Mark
Douglas
- It is one of the great paradoxes of the stock market that what seems too high usually goes higher and what seems too low usually goes lower.
-William
O'Neil
- When you genuinely accept the risks, you will be at peace with any outcome. When you're at peace with any outcome, you will experience a carefree, objective state of mind, where you make yourself available to perceive and act upon what the market is offering you at any given "now moment".
-Mark
Douglas
- There is a persistent overall tendency for equity to flow from the many to the few. In the long run, the majority loses. The implication for the trader is that to win you have to act like the minority. If you bring normal human habits and tendencies to trading, you’ll gravitate toward the majority and inevitably lose.
– William
Eckhardt
- Good systems tend to violate normal human tendencies.
– William
Eckhardt
- Don’t think about what the market’s going to do; you have absolutely no control over that. Think about what you’re going to do if it gets there. In particular, you should spend no time at all thinking about those rosy scenarios in which the market goes your way, since in those situations, there’s nothing more for you to do. Focus instead on those things you want least to happen and on what your response will be.
– William
Eckhardt
- If you own a portfolio of stocks, you must learn to sell the worst performers first and keep the best a little longer.
-William
O'Neil
- I've always found that my most profitable judgments are made late at night or on weekends. This is no accident. It's a time when you can calmly decipher the chart's message...
-Stan
Weinstein
- Whenever a breakout occurs with a stock moving into virgin territory (it's never traded there before), this is the most bullish situation you can buy. Think about it. There isn't one person who is long and has a loss.
-Stan
Weinstein
- My studies have convinced me that the most profitable market movies in the United States occur when the overwhelming majority of world markets are in agreement.
-Stan
Weinstein
- To be completely cured of newspapers, spend a year reading the previous week's newspapers.
-Nassim Taleb
- Pure price systems are close enough to the North Pole that any departure tends to bring you farther south.
-William
Eckhardt
- To bankrupt a fool, give him information.
-Nassim Taleb
- Mark Douglas
- I don't predict a nonexisting future.
-Ed Seykota
- Trend Following is an exercise in observing and responding to the ever-present moment of now.
-Ed Seykota
- To avoid whipsaw losses, stop trading.
-Ed Seykota
- I began to realize that the big money must necessarily be in the big swing.
-Jesse Livermore
- Money management is the true survival key.
-Bill Dunn
- Concentrate on the next 1,000 trades, not just the immediate one.
-Nick Radge
- We approach markets backwards. The first thing we ask is not what can we make, but how much can we lose. We play a defensive game.
-Larry Hite
- Never risk more than 1% of total account equity on any one trade. By risking 1%, I am indifferent to any individual trade. Keeping your risk small and constant is absolutely critical.
-Larry Hite
- There are old traders and there are bold traders, but there are very few old, bold traders.
-Ed Seykota
- I start out with the one thing I can know - how much am I willing to lose?
-Larry Hite
- Quite simply, you need to run a trend, not cut it short. You need to cut a loss as quickly as possible, not hope it will come good.
-Nick Radge
- The equation is simple - most important is how much you win when you win, and how much you lose when you lose. Forget right or wrong.
-Nick Radge
- If you want to become anti-fragile, put yourself in the situation "loves mistakes"... by making these numerous and small in harm.
- Those who have knowledge don't predict. Those who predict don't have knowledge.
- Lao Tzu, 6th century BC
- To attain knowledge, add things everyday. To attain wisdom, subtract things everyday.
- Lao Tzu, 6th century BC
- When a market makes a historic high, it is telling you something. No matter how many people tell you why the market shouldn’t be that high, or why nothing has changed, the mere fact that the price is at a new high tells you something has changed.
- Larry Hite
- There is a random distribution between wins and losses for any given set of variables that define an edge. In other words, based on the past performance of your edge, you may know that out of the next 20 trades, 12 will be winners and 8 will be losers. What you don’t know is the sequence of wins and losses or how much money the market is going to make available on the winning trades. This truth makes trading a probability or numbers game. 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
- If a stock is going to go up 100%, it will have to go up 20% first.
-Nick Radge
- We know that we know almost nothing. But the almost nothing we know isn't completely nothing, and we only bet on that.
- “A prophet is not someone with special visions, just someone blind to most of what others see”
- It takes three or four years of constant practice before one develops the skill for seeing things that can be seen on a stock's chart.
- As far as the betting, most gamblers will just bet based on a lucky feeling or even worse when they've lost... they're chasing their losses, which I'm sure happens in trading all the time... Whereas what we did as professional card counters, we bet bigger when we have a real advantage; we know with 100% certainty that we have an edge. Of course that doesn't guarantee we're going to win that hand, but if we just repeat getting that betting volume, maximize that betting volume with an advantage, then that's when we're going to reap the profits.
-Mike Aponte
- The most important price of the week is the Friday close. Why? All the HFT systems are flat — all the day traders have gone home. The Friday close is the price determined by traders willing to hold a position over a weekend.
-Peter Brandt
- A lot of people are "surprised" at various price movements happening at the moment. Surprise and disappointment run hand in hand and are both due to expectation. Have no expectation and you will neither be surprised nor disappointed.
-Nick Radge
- ...first check whether the market as a whole is rising or falling. In other words, are you in a bull market or bear market? If the latter, stay out. The odds are against you.
- Trends come like a series of ocean waves, bringing the high tide when things are good and, as conditions recede, the low tide appears. These trends come unexpectedly, unpredictably, and they have to be weathered with temperance, poise, and patience- good or bad.”
- "For instance, let us say that a new stock has been listed in the last two or three years and its high was 20, or any other figure, and that such a price was made two or three years ago. If something favorable happens in connection with the company, and the stock starts upward, usually it is safe play to buy the minute it touches a brand new high."
-Jesse Livermore
- My question is this: What's the difference if you continue to hold a stock that has declined by 10%, waiting for it to come back and overcome negative news, or buy a fresh new name that looks good from the start? The answer is: nothing but your ego.
- You exist in a flowing river, and figuring out how you can navigate that flow is the much bigger question to answer versus how do you control it - because you can't.
-Michael Covel
- Individual investors like to lock in their gains by selling "winners", stocks that have appreciated since they were purchased, and they hang on to their losers.Unfortunately for them, recent winners tend to do better than recent losers in the short run, so individuals sell the wrong stocks.
-Daniel Kahneman
- I am convinced that there exists a tradable security in the Western world that would be100% correlated with the changes in temperature in Ulan Bator, Mongolia.
-Nassim Taleb
- His first conclusion was that he won when all the factors were in his favor, when he was patient and waited for all the ducks to line up in a row. That led him to his second conclusion, that no one could or should trade the market all the time. There were times when a trader should be out of the market, in cash, waiting.
- Jesse Livermore had been searching for his trading strategy. Slowly, it was starting to form. The first step was to concentrate on the overall market before making a trade. He would follow the line of least resistance - up in a bull market, buy long, down in a bear market, sell short. If the market went sideways, he would wait in cash for a clear direction to be established.
- We diversify in two ways. First, we probably trade more markets worldwide than any other money manager. Second, we don't just use a single best system. To provide balance, we use lots of different systems ranging from short to long term. Some of these systems may not be that good by themselves, but we really don't care; that is not what they are there for.
-Larry Hite
- Although most of the traders I interviewed have a love for trading, none have the unbridled enthusiasm demonstrated by [David] Ryan. To Ryan, the whole process of stock selection is like a terrific game - a treasure hunt as he describes it - and he still can't believe he is getting paid to do it.
- Perfection is not when there is no more to add, but no more to take away.
-Bruce Lee
- You win a few, you lose a few, but you keep on fighting.
-Gordon Gekko
- They think that intelligence is about noticing things that are relevant (detecting patterns); in a complex world, intelligence consists in ignoring things that are irrelevant (avoiding false patterns).
-Nassim Taleb
- A good trading rule is to be long the strongest when long and short the weakest when short.
-Peter Brandt
- So the first thing I learned about how to get superior performance is not to buy stocks that are near their lows, but to buy stocks that are coming out of broad bases and beginning to make new highs...
-William O'Neil
- Look, none of this is black box. 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
- If you diversify, control your risk, and go with the trend, it just has to work
-Larry Hite
- Normal human tendencies are traits that cause you to do poorly. Therefore, to be successful as a trader you need to condition abnormal responses.
-Mark Minervini
- At one point during the summer of 1995, I was up over 100% year to date, which achieved my original goal for the entire year. I was seriously considering booking the year. A friend of mine asked, "What makes you think you can't make 200 percent?" I thought about it for a day or two, and said to myself that he's right. I ended that year up 407 percent.
-Mark Minervini
- Never risk more than 1% of your total equity in any one trade. By risking 1%, I am indifferent to any individual trade. Keeping your risk small and constant is absolutely critical
- If you can do it, great! I haven’t met anyone in my 30 year career that could consistently pick bottoms or tops. Successful trading has nothing to do with picking tops and bottoms. I think this is where many investors go wrong and enter into trading with the wrong perception because they’ve heard buy low sell high.
-Mark Minervini
- I always approach each trade from risk first; before I enter a trade I already know exactly where I’m going to get out at a loss if the trade moves against me. I don’t risk more than I expect to gain. I never ever average down; just the opposite. I trim my activity and size down when trading poorly and ramp it up when trading well; this way I trade my largest when I’m trading my best and the smallest when I’m trading my worst. This is how you manage risk and pyramid into big returns.
-Mark Minervini
- Order generated without design can far outstrip plans men consciously contrive.
-F.A Hayek
- Dr. Van Tharp
- Ed Seykota
- The simply truth is that most people are risk-aversive in the realm of profits and risk-seeking in the realm of losses.
- Dr. Van Tharp
- Good traders trade. Good letter writers write letters.
- Ed Seykota
- You can be very promiscuous in your research, but not in your trading.
-William Eckhardt
- Advice to a new trader:You are focusing on how much you can win... focus on surviving no matter what.
-Richard Weissman
- Understanding position sizing topics will have more impact on your trading results than any other single “technical” subject.
- He who knows best, best knows how little he knows.
—THOMAS JEFFERSON
- I think people spend too much time trying to discover great entry strategies and not enough time on money management.
- 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 the time, but I make more when I'm right than I lose when I'm wrong.
- The answer isn't better analysis, more analysis... the answer is better risk management, better position management.
-Richard Weissman
- My attitude toward $1 stocks is the same as my attitude toward $100 stocks - limit risk to 1% of capital.
- The 1% rule helps because you are trading small enough that you truly don't give a damn.
-Richard Weissman
- My best indicator is the value of my account.
-Nick Radge
- “The greatest enemy of knowledge is not ignorance, it is the illusion of knowledge.”
-Stephen Hawking
- It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.
- Samuel L. Clemens
- Never take investment advice from someone who has to work for a living.
-Taleb
- The elements of good trading are cutting losses, cutting losses, and cutting losses.
- Ed Seykota
- The majority of short term trading results are just random. In the long term the money ends up with those that can trade and manage risk.
-Steve Burns
- Richard Dennis
- Peter Brandt
- "I could trade without knowing the name of the market"
- Richard Dennis
- "Pro traders measure risk in one way and one way only: the % of total capital that's risked on an individual trading event"
- Peter Brandt
