1/24/2017: Edwin Lefevre

So yeah, I’ve been doing this 52 book challenge thing and I can be justly accused of picking books for size. I actually posted a question about the legitimacy of doing so on reddit, why I have no idea. I’ll occasionally need to ask the universe questions I full well know the answer to. I guess it helps to keep track of the number of things I’m juggling in my head to hear “duh” a couple few times.

I came to the conclusion that picking books for size, so that I’ll finish them is just fine as long as they’re books I’d read otherwise. No heading to the Barnes & Noble kids section to get the Percy Jackson or Captain Underpants series to blast through in an evening or anything. But if it’s already on my shelf? All clear.

One of the things I’m working on is spinning up the engines of market familiarity again, dumping as much as I reasonably can in my head, to get me ready for trading again. It’s been too long since I’ve been able to pull those levers.

At the end of the year I read “Hedge Fund Market Wizards” which was absolutely awesome. The “market wizards” books (I think there are 3 or 4) are primarily distilled interview content from Jack Schwager’s interviews with famous traders. It was one of the most enlightening books on the market I’ve ever read. The variety of approaches, personalities, and styles really left me with both the idea that there was simply no excuse for me not to be trading and the abject terror of trying to figure out what “my style of trading” really is. It’s one thing to pick one of a few available approaches and read up on how to do that well. But there are far fewer borders and boxes than I thought, leaving me with Tabula Rasa Terror.

But one thing most traders seem to universally recommend, both in the book and elsewhere, is “Reminiscences of a Stock Operator” by Edwin Lefvre, which was written almost a hundred years ago (I think the publication date was 1923) and chronicles the rags to riches to rags to riches to rags to riches journey of a man fighting with the market. Well, I finished it this morning. It certainly held up its end of the deal. Aside from some anachronistic vernacular, and a strange difference in professional culture, I was surprised (though almost certainly shouldn’t have been) at how precise he captured the general principles and pitfalls of trading (because we’re not really talking about ‘investing’ here) more than 100 years ago, and how very little it’s changed, at least in that dimension; and in that regard it was edifying to find the same emotional demons I’d faced (and, lost) occurring in someone so far out of time and experience.

Unfortunately the solutions all seem to fall in to the “Doctor doctor, it hurts when I do this….don’t do that” variety. But it’d be a lot to ask of a book from 1923 I suppose.

I’ll go back through it with a notebook and a highlighter as there’s no doubt I missed a lot of great stuff on the first read through.

Now I’ve got a bookshelf (new, more on that later) full of trading books that are starting to quiver as I get near them. Can’t wait 🙂

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