Monday, February 06, 2006

Book Review - Market Wizards - Jack D. Schwager

Market Wizards is highly recommended reading if you speculate.

There are two other books also:
The New Market Wizards and Jack D. Schwager's new book: Stock Market Wizards. Go ahead and buy all three of them - once you read one - you will want to read the others.

Schwager understands markets and traders.
Market Wizards is a series of interviews with top traders / speculators that have had remarkable runs of success.

You will want to read the interviews several times. The
Market Wizards books can be re-read as short vignettes. After the first read through they are great to leave next to your favorite chair.

What you will notice are consistent speculation rule themes that run through most of the interviews:

  • keep losses small

  • let profits run

  • limit exposure to correlated investments

  • if in doubt - get out

  • don't try to capture the first or last 10% of a move
- and a whole bunch more good advice. Notice advice derives from most of the interviews.

You will learn as much from the exceptions to speculation rules as the repetition.

Knowing when to break a speculation rule is an important bit of knowledge -
Market Wizards provides some fine insight into that subject.

You may also find yourself drawn to one style of investment - that alone can save you tons of cash and years of time.

I'll insert one of my own speculation rules here:
always buy the books before the speculations.

Market Wizards in not one writer's opinion on markets, it is the opinion of the few who have learned how to succeed on a grand scale.

Market Wizards is a compilation of great advice from great traders.



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