A detailed look at the common characteristics found in most successful traders
While there are a variety of approaches to trading in the financial markets, profitable traders tend to share similar underlying characteristics. Most have a methodology that they believe will prove profitable over the long run and are willing to endure short-term setbacks. If you're looking to make the most of your time in today's markets, you need to understand what separates the best from the rest. And with Trade Like a Casino, you'll gain the knowledge needed to excel at this challenging endeavor.
Engaging and informative, this reliable guide identifies and explains the key techniques and mental processes characteristic of successful traders. It reveals that successful traders operate very much like a casino in that they develop a method that gives them "positive expectancy" and they unflappably implement the method in the face of changing, and oftentimes volatile, market conditions. Page by page, the book explores the intricacies of methodology, mental control, and flexibility that allow traders to develop and maintain the casino-like edge.
* Reveals how many successful traders tend to follow the same general principles, even if their approach to trading may differ
* Explores how to account for the risk of being wrong and the market moving against you
* Discusses how to develop an approach that combines trade selection with sound risk management, avoids emotional attachment to positions, exploits volatility cycles, and focuses on market action
Regardless of how you approach markets, the insights found here will help improve the way you trade by putting you in a better position to distinguish the differences between successful and unsuccessful traders.
Inhaltsverzeichnis
Preface xi Acknowledgments xvii
Part I The Casino Paradigm 1
Chapter 1 Developing Positive Expectancy Models 3
Why Technical Analysis Helps 3
The Inefficient Market 6
If It Feels Good, Don't Do It 10
"Just Make the Money" 15
Final Thoughts 21
Chapter 2 Price Risk Management Methodologies 23
One Sure Thing 23
Base of Pyramid 26
Middle of Pyramid 37
Apex of Pyramid 47
Pros and Cons of the Risk Management Pyramid 49
Putting It All Together: A Case Study 49
Final Thoughts 51
Chapter 3 Maintaining Unwavering Discipline 53
Defining Discipline 53
Discipline and the Positive Expectancy Model 55
Types of Traders 61
Discipline and Price Risk Management 64
Patience and Discipline 67
Final Thoughts 70
Part II Trading Tools and Techniques 71
Chapter 4 Capitalizing on the Cyclical Nature of Volatility 73
The Only Constant 73
Defining Volatility with Technical Indicators 76
Building Positive Expectancy Models with Volatility Indicators 89
Final Thoughts 94
Chapter 5 Trading the Markets and Not the Money 95
Ten Thousand Dollars is a Lot of Money! 95
"Baby Needs a New Pair of Shoes" 99
Trading with "Scared Money" 100
Time is Money 101
Final Thoughts 104
Chapter 6 Minimizing Trader Regret 105
The Softer Side of Discipline 105
Issues for Trend-Followers 106
Issues for Mean Reversion Traders 113
Final Thoughts 123
Chapter 7 Timeframe Analysis 125
Traditional Timeframe Analysis 125
Timeframe Confirmation Trading 131
Timeframe Divergence Trading 131
Final Thoughts 142
Chapter 8 How to Use Trading Models 143
Mechanical Trading Systems 143
Nonmechanical Models 162
Equity Trading Models 170
Final Thoughts 175
Chapter 9 Anticipating the Signal 177
Always Trade Value, Never Trade Price 177
Support (and Resistance) Were Made to be Broken 179
Don't Anticipate, Just Participate 181
Final Thoughts 187
Part III Trader Psychology 189
Chapter 10 Transcending Common Trading Pitfalls 191
Characteristics of Market Behavior 191
Obstacle Makers to Growth as a Trader. 195
Final Thoughts 202
Chapter 11 Analyzing Performance 205
A Due Diligence Questionnaire 205
Trading Journal 225
Final Thoughts 236
Chapter 12 Becoming an Even-Tempered Trader 241
The "I Don't Care Guy" 241
The Master Trader 244
Reprogramming the Trader 247
Flexibility and Creativity 248
Meditation 250
Visualization 251
Somatic Exercises 253
Final Thoughts 254
Notes 257
Bibliography 263
About the Author 265
Index 266
