This book is a comprehensive guide to the world of trading and is one of the most valuable resources I’ve ever read. Van Tharp covers everything from the basics of trading to advanced concepts, and he does it in an easy way to understand and apply. This book has some very unique insights into position sizing and trading psychology. What’s in the book: I plan everything. I set up worst-case scenarios, and we run through them just as an exercise. I have specifications on the best case and the worst casefor each scenario. Thus, when something comes along, I have usually plannedfor it and have a range of expectancy. If the results fall within that range, then I know everything is as planned. If the resultsfull outside that range, then later in this chapter) would stop most people from ever testing a system. And more importantly, most people never get to the point where they even have a testable system. However, for those who do get to this point, the result of these next biases can be insidious. Degrees-of-Freedom Advanced concepts in trading: The book delves into more advanced concepts, such as trading systems, risk management, and position sizing.

I am fairly good at discipline. I have no problems following n sys tern. Do you tend to get compulsive (i.e., get caught up in the excitement of trading), have personal conflicts (i.e., have a history of conflicts with yourfamily, at your job, or during past trading experience),-or have any emotional issues that constantly crop up, such as fear or anger? I'm your average Joe trader, manage some of my investments (dabble more like it). Dabbling in the recent run up in cryptocurrencies is what drove a friend to recommend this book to me. I've never written a book review but felt compelled to do so, not to rave on this book, but as "warning" to how to get the most out of it before giving up. This allows us to place a maximum amount onto each trade while fixing our downside. With the equal position size model, we do not maximise our parcel size as it remains constant regardless of the risk on a particular trade.

5 Must-Read Books for Aspiring Traders

The worst thing that can happen to a client is a surprise. We make sure that doesn’t happen by educating our clients. 1 even wrote a book to prepare them, Panic Proof Investing.2 How will you handle a large infusion of new capital or a large withdrawal?

Life’s short. It’s not about hoarding all your cash until you’re 65. You’re allowed to enjoy life while you’re alive. By applying the position sizing secrets (the 2% rule) mentioned in our examples above, you stand to be alive on a losing streak and maximise your opportunities when winning. Money is simply a necessity like food or water. It helps you buy the things you need and live the life you want. Revealed (New York: Viking Studio Books, 1994). The book discusses the mythology of nine different myths about the Holy Grail which appeared in a 30.year span between AD 1190 and 1220.Chapter 6 Understanding Expectancy and Other Keys to Trading Success 130 The Six Keys to Investment Success 130 The last financial freedom tip is an important one. Say you follow the advice and recommendations in this article, get out of debt, and grow your savings. That might be enough to help you out right now. But what if the unexpected happens? Will you be prepared for it? So now we'd still be risking only 1%, but our capital on the trade would be smaller. It will take much longer to reduce our trading capital. Learning to place the maximum on a trade without increasing your risk When he says in Chapter 12 of this book that "...money mangement is the most important aspect of system development, other than pysychology..." Tharp is absolutely correct.