Trading Quotes from �Way of Turtle� by Curtis Faith � Part 2

Go back to Part 1.

Some more good trading quotes from "Way of the Turtle: The Secret Methods that Turned Ordinary People into Legendary Traders" by Curtis Faith.

Don�t spent all your time admiring the fancy tools in the magazine.
First learn how to use the basic ones well. It�s not the size of your tools that counts but how you use them.

Keep it simple. Simple time-tested methods that are well executed will beat fancy complicated method every time.

Trading with poor methods is like learning to juggle while standing in a rowboat during the storm. Sure, it can be done, but it is much easier to juggle when one is standing on a solid ground.

Trading is not a sprint; it is boxing. The market will beat you up, screw with your head, and do anything it can to defeat you. But when the bell sounds at the end of the twelfth round, you must be standing in the ring in order to win.

The market does not care how you feel. It will not prop up your ego or console you when you are down.
Therefore, trading is not for everyone. If you are unwilling to face the truth about the markets and the truth about your own limitations, fears and failures, you will not succeed.

I always say that you could publish my trading rules in the newspaper and no one will follow them.
The key is consistency and discipline. Almost anybody can make up a list of rules that are 80% as good as what we taught our people. What they couldn�t do is give them the confidence to stick with those rules even when things are going bad.
(By Richard Dennis, quoted in 'Market Wizard' by Jack D. Schwager)

Related Topics:
* Free Trading Educational Video: Learn Technical Tips from Dan Gramza
* Option Greek
* Understanding Implied Volatility (IV)
* Understanding Option�s Time Value
* Learning Candlestick Charts
* Learning Charts Patterns

Read more »

Trading Quotes from �Way of the Turtle� by Curtis Faith � Part 1

About 25 years ago, trading guru Richard Dennis reportedly said to his long-time friend William Eckhardt, a friend and fellow trader. Dennis believed that successful trading could be taught. This started a bet between them about whether great traders were born or made. To settle this debate, Dennis recruited and trained 21 men and 2 women, and this became a legendary trading experiment.
Dennis trained his Turtles, as he called them, for only two weeks. Then he gave each of them a million dollars of his own money to manage, and turned each one loose on the markets. When his experiment ended five years later, his Turtles reportedly had earned an aggregate profit of $175 million.

Curtis Faith is one of the Turtles. One of his book is Way of the Turtle: The Secret Methods that Turned Ordinary People into Legendary Traders.

Found good trading quotes from this book� with deep meaning.
Here they are:

Human emotion is both the source of opportunity in trading and the greatest challenge.
Master it and you will succeed.
Ignore it at your peril.

Trade with an edge, manage risk, be consistent, and keep it simple.
The entire Turtle training, and indeed the basis of all successful trading, can be summed up in these four core principles.

Good trading is not about being right, it�s about trading right.
If you want to be successful, you need to think of the long run and ignore the outcomes of individual trades.

Trading with an edge is what separates the professionals from amateurs.
Ignore this and you will be eaten by those who don�t.

Edges are found in the places between the battleground between buyers and sellers.
Your task as a trader is to find those places and wait to see who wins and who loses.

Mature understanding of and respect of risk is the hallmark of the best traders.
They know if you don�t keep an eye of risk, it will set its eye on you.

Ruin is the risk you should be concerned with the most.
It can come like a thief in the night and steal everything if you�re not watching carefully.

Continue to Part 2.

Related Topics:
* Free Trading Educational Video: Learn Technical Tips from Dan Gramza
* Option Greek
* Understanding Implied Volatility (IV)
* Understanding Option�s Time Value
* Learning Candlestick Charts
* Learning Charts Patterns

Read more »

GARTMAN�S RULES OF TRADING � Part 3: Technical Trading System

Go back to Part 2: Trading System & Money Management

TECHNICAL TRADING SYSTEM

16. Keep your technical systems simple.
Complicated systems breed confusion; simplicity breeds elegance.

17. Establish initial positions on strength in bull markets and on weakness in bear markets.
The first "addition" should also be added on strength as the market shows the trend to be working. Henceforth, subsequent additions are to be added on retracements.

18. Respect and embrace the very normal 50-62% retracements that take prices back to major trends.
If a trade is missed, wait patiently for the market to retrace.
Far more often than not, retracements happen... just as we are about to give up hope that they shall not.

19. Bear markets are more violent than are bull markets and so also are their retracements.

20. Try to trade the first day of a gap, for gaps usually indicate violent new action.
We have come to respect "gaps" in our nearly thirty years of watching markets; when they happen (especially in stocks) they are usually very important.

21. Respect "outside reversals" after extended bull or bear runs.
Reversal days on the charts signal the final exhaustion of the bullish or bearish forces that drove the market previously. Respect them, and respect even more "weekly" and "monthly," reversals.

GENERAL

22. All rules are meant to be broken: The trick is knowing when... and how infrequently this rule may be invoked!

Related Topics:
* Learn Technical Analysis from LINDA RASCHKE for FREE
* Learning Candlestick Charts
* Learning Charts Patterns

Read more »

GARTMAN�S RULES OF TRADING � Part 2: Trading System & Money Management

Go back to Part 1: Trading Psychology

TRADING SYSTEM & MONEY MANAGEMENT

7. Never, under any circumstance add to a losing position.... ever!
Nothing more need be said; to do otherwise will eventually and absolutely lead to ruin!

8. Trade like a mercenary guerrilla.
We must fight on the winning side and be willing to change sides readily when one side has gained the upper hand.

9. The objective is not to buy low and sell high, but to buy high and to sell higher.
We can never know what price is "low." Nor can we know what price is "high."
Always remember that sugar once fell from $1.25/lb to 2 cent/lb and seemed "cheap" many times along the way.

10. In bull markets we can only be long or neutral, and in bear markets we can only be short or neutral.
That may seem self-evident; it is not, and it is a lesson learned too late by far too many.

11. Sell markets that show the greatest weakness, and buy those that show the greatest strength.
Metaphorically, when bearish, throw your rocks into the wettest paper sack, for they break most readily.
In bull markets, we need to ride upon the strongest winds... they shall carry us higher than shall lesser ones.

12. Do more of that which is working and less of that which is not.
If a market is strong, buy more; if a market is weak, sell more.
New highs are to be bought; new lows sold.

13. Trading runs in cycles: some good; most bad. Trade large and aggressively when trading well; trade small and modestly when trading poorly.
In "good times," even errors are profitable; in "bad times" even the most well researched trades go awry. This is the nature of trading; accept it.

14. Be patient with winning trades; be enormously impatient with losing trades.
Remember it is quite possible to make large sums trading/investing if we are "right" only 30% of the time, as long as our losses are small and our profits are large.

15. To trade successfully, think like a fundamentalist; trade like a technician.
It is imperative that we understand the fundamentals driving a trade, but also that we understand the market's technicals. When we do, then, and only then, can we or should we, trade.

To be continued to Part 3: Technical Trading System

Related Articles:
* FREE Trading Educational Resources You Should Not Miss
* Trading System: What Is It and Is It Important?
* Why Being Right In Your Trading Does Not Necessarily Mean Making Money
* The Psychological Need To Be Right vs. Making Money
* The Fear Of Losing Money

Read more »

GARTMAN�S RULES OF TRADING � Part 1: Trading Psychology

22 Trading Rules by Dennis Gartman, Editor/Publisher of The Gartman Letter:
(I was just trying to group the rules based on their topics)

TRADING PSYCHOLOGY

1. Capital comes in two varieties: Mental and that which is in your pocket or account.
Of the two types of capital, the mental is the more important and expensive of the two. Holding to losing positions costs measurable sums of actual capital, but it costs immeasurable sums of mental capital.

2. "Markets can remain illogical longer than you or I can remain solvent", according to our good friend, Dr. A. Gary Shilling.
Illogic often reigns and markets are enormously inefficient despite what the academics believe.

3. An understanding of mass psychology is often more important than an understanding of economics.
Markets are driven by human beings making human errors and also making super-human insights.

4. The market is the sum total of the wisdom ... and the ignorance...of all of those who deal in it; and we dare not argue with the market's wisdom.
If we learn nothing more than this we've learned much indeed.

5. The hard trade is the right trade: If it is easy to sell, don't; and if it is easy to buy, don't.
Do the trade that is hard to do and that which the crowd finds objectionable.
Peter Steidelmeyer taught us this twenty five years ago and it holds truer now than then.

6. There is never one cockroach: Bad news begets bad news, which begets even worse news.

Continue to Part 2: Trading System & Money Management

Related Articles:
* A Chance to Learn from World Class Trading Experts For FREE You Should Not Miss
* Why Trading Psychology Is Very Important
* Reverse Psychology For Success

Read more »

Trading Quotes from �The Logical Trader� by Mark B. Fisher � Part 2

Go back to Part 1.

There are some more good trading quotes from the book, The Logical Trader.

Hope these can give you some insights for trading psychology.
Why do I like this kind of trading quotes? Because in my opinion, trading psychology plays very important part in trading success.
So, enjoy!

I Have No Clue
If a market is making a substantial move and traders seem to understand why, this market trend is not going to last very long.
However, if the market is moving in one direction and nobody has no clue as to why, then the trend is going to be prolonged.

When a market goes up or down for no apparent reason, it tends to go a lot further in that direction than people can imagine.

Be The House
The more time you spend at the table, the more bets you are going to place, and the greater the probability that you will eventually walk out of the casino as a loser. The casino would rather not have someone make a single large wager and, win or lose, immediately walk away.
What the house wants is for you to keep playing. The passage of time is the casino�s best friend and the player�s worst enemy.

Money Management
If the odds are in your favor of making a profit with your trading system, then keep your trade size consistent, cut your losses short, and know that, over time, you�ll be successful.

Fear and Greed
The two key ingredients that every trader needs to posses in the right combination in order to be successful � namely, fear and greed.

You need to have enough fear in you, meaning a healthy amount of respect for the market that you are participating in.
Allowing yourself that you are always right, especially when the market is clearly dictating that you are dead wrong, is a sure path toward trading disaster.

However, fear is not enough.
A trader must also have a healthy amount of greed.
You must be willing and able to press winning trades and allow these once-in-a-blue-moon occurrences to develop into large scale winners.
Sometimes it takes an iron will and a great deal of patience to be able to max out on these particular trades.

Staying Out Of The Penalty Box
The key to the whole puzzle is discipline, the more you have, the better you�ll trade.
The best traders have incredible amounts of discipline when they have a trading position on. They cut their losses and run. That�s the hardest thing on the world for a lot of other traders.
Maybe you�re bullish on the market, but your indicators say to get out. After you do, the market goes up this one time. Then you question your system. But if you stick with the system, you�ll be a lot better off.

Read more »

Trading Quotes from �The Logical Trader� by Mark B. Fisher - Part 1

Recently, I just read a book authored by Mark B. Fisher, The Logical Trader.
Although this book is not really one of my favourites, there are some good trading quotes that I like from that book. So, I think it may be good to share them here too.

Here are the trading quotes:

Have A Plan
In trading, as in life, you need a plan. This plan includes not only the micro � a strategy for each and every trade you make � but also the macro � meaning why you trade, how you intend to reach that goal (your means to the desired end), and what you�ll do as an alternative if that doesn�t work out.

Know what you want to accomplish, how you intend to get there, and what you will do if it does � or does not � work out. Have a plan and stick with it. That works in trading, as well as in life.

I Know Who I Am
Coming to term with who I am as a trading, knowing my limitations, and doing what I do well � and not doing those things that I have no clue about � has brought me continued success.
Too many people want to be who they are not, and professionally � whether in trading or in another field of business � that�s where they run into trouble.

Discipline and Comfortable With Yourself
You don�t need complicated Einstein formulas to make money in the markets.
You do need to be disciplined and comfortable with yourself.
No matter how good of a trader you think you are, the markets are always going to screw with your head and test your mental fortitude.
Remember, the survivors are also the ones who make up the market�s success stories.

Time Stop
An important rule of trading is that time is much more important than price.
Successful trading is a matter of seeking out immediate gratification. If the market doesn�t move your way within a short time of putting on a trade, just get out.
Most people trade just with Price Stops and not with Time Stops. They think they have to endure some initial pain. You, however, should not.

Get Out When You�re Wrong
Successful traders know that discipline is what allows them to enter their trades when the odds are in their favor and, more importantly, to get out when they�re wrong.
Being right is not the problem. What you do when you�re wrong is the crucial issue.

There are a lot of traders who buy then pray while the market goes against them, because they think that it will eventually go their way.
Most traders average down and wait for the market to turn their way.
Trading my way, I always have defined amount of money that I am willing to lose.
I let the market decide how much money I�m going to make.

Good News/Bad Action
When the news is good but the market just does not rise correspondingly, sell.

Continue to Part 2.

Read more »