To avoid whipsaw losses, stop trading.
The men on the trading floor may not have been to school, but they have Ph.D.’s in man’s ignorance.
The biggest trading partner of the United States is not West Germany or Japan, it's right here.
Don’t ever average losers. Decrease your trading volume when you are trading poorly; increase your volume when you are trading well. Never trade in situations where you don’t have control. For example, I don’t risk significant amounts of money in front of key reports, since that is gambling, not trading.
If past history was all there was to the game, the richest people would be librarians.
I haven't seen much correlation between good trading and intelligence. Some outstanding traders are quite intelligent, but a few aren't. Many outstanding intelligent people are horrible traders. Average intelligence is enough. Beyond that, emotional makeup is more important.
You can be very promiscuous in your research, but not in your trading.
"I can't sleep" answered the nervous one. "Why not?" asked the friend. "I am carrying so much cotton that I can't sleep thinking about. It is wearing me out. What can I do?" "Sell down to the sleeping point", answered the friend.
My experience with novice traders is that they trade three to five times too big. They are taking 5 to 10 percent risks on a trade when they should be taking 1 to 2 percent risks. The emotional burden of trading is substantial; on any given day, I could lose millions of dollars. If you personalize these losses, you can’t trade.
I believe that great success is possible in any field — from music to mathematics to macro trading.
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.
The first rule of trading - there are probably many first rules - is don't get caught in a situation in which you can lose a great deal of money for reasons you don't understand.
Life can be lived at a remove. You trade in futures, and then you trade in derivatives of futures. Banks make more money trading derivatives than they do trading actual commodities.
You must ignore what everyone else is doing and trade only when you feel the odds are in your favor. In short, trade only when you and you alone are comfortable that the expected return of your trades will be positive. That might mean you'll have to sit out a few parties, but it will also mean that you'll have more profits over the course of your trading career.
The financial calculus that Charlie and I employ would never permit our trading a good night's sleep for a shot at a few extra percentage points of return. I've never believed in risking what my friends and family have and need in order to pursue what they don't have and don't need.
A prudent speculator never argues with the tape. Markets are never wrong, opinions often are.
Fundamentalists who say they are not going to pay any attention to the charts are like a doctor who says he's not going to take a patient's temperature.
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.
Your trading needs to boil down to rules, money management, and that is it.
Sell before the holidays. Stock prices tend to rise on the last trading day before major holidays.
Most traders believe that 'getting into the zone' happens when you have 'a hot streak.' I believe you can create the zone. The zone is a psychological state. It is when you are focused, disciplined, and fully engaged in the process at hand . . . trading in the zone will certainly increase your capacity to perform and succeed.
Successful trading depends on the 3M`s - Mind, Method and Money. Beginners focus on analysis, but professionals operate in a three dimensional space. They are aware of trading psychology their own feelings and the mass psychology of the markets. Each trader needs to have a method for choosing specific stocks, options or futures as well as firm rules for pulling the trigger - deciding when to buy and sell. Money refers to how you manage your trading capital.
In a narrow market, when prices are not getting anywhere to speak of but move within a narrow range, there is no sense in trying to anticipate what the next big movement is going to be. The thing to do is to watch the market, read the tape to determine the limits of the get nowhere prices, and make up your mind that you will not take an interest until the prices breaks through the limit in either direction.
The chief cause of failure and unhappiness is trading what you want most for what you want right now
There are just four kinds of bets. There are good bets, bad bets, bets that you win, and bets that you lose. Winning a bad bet can be the most dangerous outcome of all, because a success of that kind can encourage you to take more bad bets in the future, when the odds will be running against you. You can also lose a good bet no matter how sound the underlying proposition, but if you keep placing good bets, over time, the law of averages will be working for you.
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