Trading Nuggets

Even though investors often try to reinvent the wheel, many of the most successful traders today have patterned their trading styles after those of the great traders of the past.

You need the most up-to-date current trading strategies to build wealth in your IRA, right? Well, not necessarily.

Even though investors often try to reinvent the wheel, many of the most successful traders today have patterned their trading styles after those of the great traders of the past.

In the early part of the 20th century, Jesse Livermore was the most successful (and most feared) stock trader on Wall Street. He predicted the stock market crash of 1907 and once made $3 million in a single day. In 1929, Livermore went short several stocks and made $100 million. He was blamed for the stock market crash that year, and solidified his nickname, “The Boy Plunger.” Livermore was also a successful commodities trader.

Here are some trading nuggets from Livermore that still ring true today.

“All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope. That is why the numerical (technical) formations and patterns recur on a constant basis.”

“The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the person of inferior emotional balance, or the get-rich-quick adventurer. They will die poor.”

“Don’t take action with a trade until the market, itself, confirms your opinion. Being a little late in a trade is insurance that your opinion is correct. In other words, don’t be an impatient trader.”

“It is foolhardy to make a second trade, if your first trade shows you a loss. Never average losses. Let this thought be written indelibly upon your mind.”

“Remember this: When you are doing nothing, those speculators who feel they must trade day in and day out, are laying the foundation for your next venture. You will reap benefits from their mistakes.”

“When a margin call reaches you, close your account. Never meet a margin call. You are on the wrong side of a market. Why send good money after bad? Keep that good money for another day.”

For daily trading advice and actionable strategies, visit TraderPlanet.com

Julie Saltzman has been involved in the trading industry for over 25 year as a writer, a floor trader and an educator. Saltzman began her career as a trader for Banque National de Paris in the currency option pits of the Chicago Mercantile Exchange and has spent the past five years exclusively in the trading education space. She is passionate about helping to level the playing field for all investors and is currently the Senior Project Manager for TraderPlanet PRIME, an online portal that provides exclusive interactive education and actionable trade strategies for your IRA.