Bulls on Wall Street
To be the best, you have to learn from the best.
Trading is a lifelong educational game. Whether you are brand new or a seasoned trader, you need to keep growing and improving.
If you get complacent, keep in mind that there is always another trader working harder than you are willing to take your money. This is a zero sum game.
Today, let’s take a look at some of the best dealers of the past century. This shows you how timeless trading hours are and what principles lead the best traders to massive success:
Jesse Livermore was an American trader known for both massive gains and losses in the market. Its greatest claim to fame is its short circuit after the 1929 market crash before the great recession. He built his net worth to $ 100 million. As the author of one of the greatest trading books of all time, Reminisces of a Stock Operator, his lessons are timeless. He’s one of the first pioneers of technical analysis on which we based our trading style here at Bulls on Wall Street.
One of the biggest takeaways of his career: The trade is volatile. There are weeks when you cannot be stopped. There will be weeks when you want to quit. It gives you a realistic view of life as a trader. He makes this list for one of the greatest short pieces of all time. If you are unfamiliar with short selling, there is an easy way to profit from the decline in an asset.
Some of his most famous rules:
- There is never anything new in the business of speculating or investing in stocks and commodities.
- Money cannot be made consistently every day or every week during the year.
- Do not trust your own opinion and base your judgment until the action of the market itself confirms your opinion.
- Markets are never wrong – opinions are often.
- The real money that was made through speculation was commitments that were shown in profit from the start.
- As long as a stock is trading right and the market is right, there is no rush to take profits.
- One should never allow speculative ventures to get into investments.
- The money lost through speculation alone is small compared to the gigantic sums lost by so-called investors who have skyrocketed their investments.
- Never buy a stock as it has fallen sharply from its previous high.
- Never sell a stock because it seems expensive.
Paul Tudor Jones
Paul Tudor Jones is the founder of the famous Tudor Investment Corporation, one of the world’s largest hedge funds. Many of you may recognize him as one of the famous market wizards. He gained notoriety after making a huge fortune shorting stocks during the iconic 1987 market crash known as Black Monday. One of the biggest crashes in stock market history.
Some of his top trading tips:
- Counter-trend trader. Looks for extreme market conditions.
- Trade the smallest position sizes when his trade is worst and increase the size when he is hot.
- Focuses on the risk / reward ratio. Looks for low risk, high reward opportunities. He’s pursuing it from a very low-risk standpoint until repeatedly proven wrong or until he changes his mind.
- Mainly a swing trader. Catches loves to catch tops and bottoms.
- Get out of losing positions quickly. Nothing beats a fresh start. The key is to play a good defense, not a huge insult.
- Never lose average trades.
John Paulson is another founder of famous hedge fund Paulson & Co. He rose to fame in the financial world after making billions of dollars in 2007 using credit default swaps to short the U.S. subprime mortgage credit market. One of the biggest short sales in history.
You will find that many of these traders made their fortunes on market declines. Most were wiped out during these periods, but the best make life changing money. Patience, preparation, resilience, and robot decision-making enable Paulson and other traders to capitalize on these times of crisis.
Richard Dennis is an incredibly successful commodities trader based in Chicago. He reportedly made a fortune of $ 200 million from his trade over a decade. He had converted his initial stake of $ 5,000 into over $ 10 million, which led him to create the mythical Turtle Trading Experiment.
The Turtle Traders show the power of a trading system with an advantage. The experiment was started by Dennis to finally settle this debate. Dennis would find a group of people to teach his rules to and then let them trade for real money. Dennis believed in his ideas so firmly that he would actually give traders his own money to trade. The training would take two weeks and could be repeated over and over.
According to former turtle Russell Sands as a group, “The two classes of turtles that Dennis personally trained made more than $ 175 million in just five years. Dennis had proven beyond a doubt that beginners can learn to trade successfully. Sands claims the system is still working fine, saying that if you started with $ 10,000 in early 2007 and followed the original rules for turtles, you would have ended the year with $ 25,000. “
Trading is not a fraud. It’s a skill that can be learned. It’s not easy or overnight, but it is possible if you are dedicated and have the right care.
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