Investment Nuggets – Jesse Livermore

Jesse Livermore is widely acclaimed as the greatest and one of the most successful stock traders on Wall Street. Known by his nickname, “The Boy Plunger”, he is said to have gone short (selling a stock that one does not own hoping to buy at a lower price) on several stocks in the 1929 stock market crash and made $100 million. He had also done something similar in the stock market crash of 1907. The book, Reminscences of a Stock Operator by Edwin Lefevre, a mandatory read for every stock trader is said to be loosely modelled on the life and trading habits of Jesse Livermore.

“There is only one side to the stock market… not the bull side or the bear side, but the right side. It took me longer to get that general principle fixed firmly in my mind than it did most of the more technical phases of the game of stock market speculation.”

“The only way you get a real education in the market is to invest cash, track your trade, and study your mistakes!”

“Every stock is like a human being: It has a personality, a distinctive personality. Aggressive, reserved, hyper, high-strung, volatile, boring, direct, logical, predictable, unpredictable. I often studied stocks like I would study people; after a while their reactions to certain circumstances become more predictable.”

“Wall Street never changes. The pockets change, the suckers change, the stocks change, but Wall Street never changes because human nature never changes.”

“After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: It never was my thinking that made the big money for me. It always was my sitting. Got that? By sitting tight!”

“All through time, people have basically acted and reacted the same way in the market as a result of: Greed, fear, ignorance, and hope. That is why the numerical (technical) formations and patterns recur on a constant basis.”

“The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the person of inferior emotional balance, or the get-rich-quick adventurer. They will die poor.”

“Don’t take action with a trade until the market, itself, confirms your opinion. Being a little late in a trade is insurance that your opinion is correct. In other words, don’t be an impatient trader.”

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