Learn from
Trader Legends! By Tom Meier http://www.easy-trader.chWhat do world’s best Traders differently than average investor? Can average investor learn from Trader Legend’s success stories and their systems used? What do most famous Traders have in common that can be applied by average talented trader?
Before we will give some insights on those questions let’s have a look at some of most successful Trader Legends:
ØNicolas Darvas turned an $ 36’000 account into $ 2’000’000 in 18 months!!! ØEd Seykota, a Turtle Trader, turned $ 5'000 into $ 15'000'000 in 12 years!!! ØJesse Livermore made several multi-million dollar fortunes in early 1900's ØRichard Dennis, another Turtle Trader, made between $ 100 and $ 200 million ØGeorge Soros is believed to be one of greatest Trader of all time!!!
The results are quite impressive and some other amazing Traders could be added easily to list above. Why do these guys have such tremendous results?
There are common factors, which can be observed through most of successful Trader Legends:
ØThey have a System which they strictly follow. ØMost of them have a trend-following trading style. ØMost of them have a mid- to long-term approach. ØThey have no fear and greed mentality. ØThey have absolute discipline and stick 100% to their system. ØTheir trades are fully planed; they are prepared for all scenarios in advance. ØThey know that a system goes through bad times and good times. Cut losses early and let profits run. ØTheir systems fit to their personality.
Some of these points sound logical and I see people nodding their heads. But in reality average investor behaves completely different. Some of them burned their fingers over last three years and some even lost a fortune. Here are some examples of observed behaviour patterns:
ØLosses are not cut early enough. ØInvestment with a short-term horizon become long-term horizon in hope of raising prices. ØPeople listen to advise of their investment Brokers and Analysts. ØPeople invest in hot stocks recommended by colleagues of their colleagues. ØPeople have no plan for their investments. ØMoney Management is not considered at all. ØPeople use trading styles which do fit their personality. ØGreed and fear is omnipresent.
