Quotes from Alexander Elder

When a beginner wins he feels brilliant and invincible Then he takes wild risk and loses everything.

Markets are actually set up so that most traders must lose money

Markets need a fresh supply of losers just as builders of the ancient pyramids needed a fresh supply of slaves. Losers bring money into the markets, which is necessary for the prosperity of the trading industry.

Being simply "better than average" is not good enough. You have to be head and shoulders above the crowd to win a minus-sum game.

An astute trader aims to enter the market during quiet times and take profits during wild times.

So far, the only people who've made money from trading systems are their sellers.

The answer is to draw a line between a businessman's risk and a loss. As traders, we always take businessman's risks, but we may never take a loss greater than this predetermined risk.

To help ensure success, practice defensive money management. A good trader watches his capital as carefully as a professional scuba diver watches his air supply.

People trade for many reasons—some rational and many irrational. Trading offers an opportunity to make a lot of money in a hurry. Money symbolizes freedom to many people, even though they often don't know what to do with it.

There are good trading systems out there, but they have to be monitored and adjusted using individual judgment. You have to stay on the ball—you cannot abdicate responsibility for your success to a mechanical system.

It is hard enough to know what the market is going to do; if you don't know what you are going to do, the game is lost.

To win in the markets, we need to master three essential components of trading: sound psychology, a logical trading system, and an effective risk management plan.

Why do most traders lose and wash out of the markets? Emotional and mindless trading are big reasons, but there is another. Markets are actually set up so that most traders must lose money. The trading industry slowly kills traders with commissions and slippage.

The mental baggage from childhood can prevent you from succeeding in the markets. You have to identify your weaknesses and work to change. Keep a trading diary—write down your reasons for entering and exiting every trade. Look for repetitive patterns of success and failure.

A loser's true problem is not account size but overtrading and sloppy money management. He takes risks that are too big for his account size, however small or big. No matter how good his system may be, a streak of bad trades is sure to put him out of business.

Use limit orders almost exclusively—except when placing stops. Be careful on what tools you spend money: there are no magic solutions. Success cannot be bought, only earned.

The public wants gurus, and new gurus will come. As an intelligent trader, you must realize that in the long run, no guru is going to make you rich. You have to work on that yourself.

The New Sell & Sell Short: How to Take Profits, Cut Losses, and Benefit from Price Declines (John Wiley & Sons, 2011).

People deceive and play games with themselves. Lying to others is bad, but lying to yourself is hopeless.

An intelligent businessman takes only risks that will not put him out of business, even if he makes several mistakes in a row.

Comience a llevar un diario: un registro de todas sus operaciones, con las razones para entrar y salir de éstas. Busque patrones repetitivos de éxito y de fracaso. Aquellos que no pueden recordar el pasado están condenados a repetirlo. El

En realidad, encuentro que el porcentaje de inversores exitosos es mayor entre las mujeres. Como grupo, tienden a ser más disciplinadas y menos arrogantes que los hombres.

la mayoría de personas disfrutaba de seguir al líder. Les liberaba de la obligación de pensar por sí mismos.

Before we analyze charts and look for stocks to buy or sell, let's explore several basic questions: what markets to trade, how to manage risk and why keep a trading journal.