The Day Traders: The Untold Story of the Extreme Investors and How They Changed Wall Street Forever [Hardcover]

Gregory J. Millman (Author)

Book Description

Publication Date: November 10, 1999

The gold rush that is revolutionizing Wall Street and the markets--the story of day trading as it's never been told
In The Day Traders, Gregory Millman goes behind the scenes to reveal the truth about a modern gold rush that has people from all walks of life playing the market online, in real time, just like Wall Street's biggest pros. This is the story of the extreme investing scene, where the upside dazzles and the threat of financial injury is dire. And whether the day-trading phenomenon lasts a hundred years or ends tomorrow, the markets we know as "Wall Street" will never be the same. Millman chronicles how that happened and why, who wins and who loses.
Here are just a few of the players you will meet:
¸  The "King of the Bandits," the first upstart to beat the Wall Street establishment at its own game
¸  The techno-rebels who launched a revolution in the markets and put the New York Stock Ex-change and Nasdaq on the run
¸  The shady courtroom antagonists whose im-broglio of lawsuits and investigations have pried the lid off day trading's best-kept secrets--including allegations of fraud, money laundering,
corporate espionage, racketeering, and more
This is a story of people testing themselves against almost impossible odds. "Trading is incredibly intense," says one psychologist. "It can suck you in. At the end of the day you feel good or bad about yourself as a person based on whether you've made or lost money." One young doctor won so much playing the markets in med school that he left medicine for the life of a trader, only to spiral down into compulsive gambling, barely escaping the worst.
Step inside a day-trading course with Millman and take an objective look at the methods and lessons of the game. Meet other would-be traders: a mother-and-daughter team, a Thai immigrant, a former small-business owner seeking a new career after disability ended his first, a onetime mining engineer trying to regain his self-esteem after being laid off for several years. All of them are eager to join the virtual gold rush and try their luck at a high-stakes game whose first rule is: Forget everything you ever knew about investing.
Millman shows why the game gets harder even as it gets bigger, and shows how technology is turning day trading into an international phenomenon, opening new markets and breaking old rules. Some have found a way to make millions even on losing trades--like the failed Texas trader who lost big online but won bigger in court by suing the investor who lent him money to cover margin calls.
The Day Traders also includes "The Extreme Investor's Manual"--a handy how-to look at day trading that includes the principles of successful trading as well as a guide to taking your broker to court if things go awry, as they frequently do in this high-stakes world.

Editorial Reviews

Amazon.com Review

If you're thinking about day trading for a living, take a cold shower and then read The Day Traders. If you read the book first, you may not need the shower. If you do both and still want to day trade, you may well have what it takes to succeed, and this book will certainly help. Gregory J. Millman, a financial journalist and author of The Vandal's Crown, tells a behind-the-scenes story of how technology and scandal brought bucket shops to cyberspace, how ordinary folks, exploiting the disintegration of the old order, are becoming gunslingers in an extreme financial video game offering danger to all who try it and limitless rewards to those few who succeed.

Day traders must have intense focus and discipline, keen minds, fast reflexes--oh, and plenty of capital. Their prosperity depends on entering up to 300 trades a day, successfully pitting themselves against the best professional traders at the biggest Wall Street houses. And it's not getting any easier, for as day trading has made markets more efficient--narrowing spreads and increasing liquidity--more efficient markets make successful day trading even more difficult as the spreads narrow. Millman interviews the patriarchs and prophets of modern day trading, along with technologists, regulators, lawyers, market makers and of course--lots of day traders. A psychologist who treats many day traders says the game is pathologically addictive with sometimes fatal consequences. There's a chapter devoted to the bucket-shop wizard of the Gilded Age, the first day trading master, Jesse Livermore, whose penetrating insights are gospel for many traders (and immortalized in Edwin Lefèvre's Reminiscences of a Stock Operator). Both Livermore and a recent Atlanta day trader blew their brains out in the end, the latter taking several other day traders with him.

But those who aspire to the calling will find much useful information and advice here, including a checklist to consider before starting, and an overview of a month-long "boot-camp" course on markets, trading technology, and extreme investing. Everyone else will find a vastly entertaining and informative read about an important but somewhat bizarre aspect of our market system and how it works. --Scott Harrison

From Publishers Weekly

While how-to books for day traders abound, Millman (The Vandal's Crown), a business journalist, takes an analytical look at the phenomenon. The combination of a roaring bull market and the spread of technology has enabled anyone with access to a computer to trade his or own stocks. Day trading is so widespread now that even the largest brokerage houses are starting to offer online trading services to customers. While many day traders invest for the long term, others are in the market for a quick kill, and these are the people who are featured by Millman. So-called "extreme traders" are not investors at all. They're not interested in lending capital to businesses they believe will be profitable in the long term, but rather look to make money by exploiting price discrepancies and by making manyAsometimes hundreds ofAtrades per day. Millman is both admiring and critical of how day trading has evolved. On the positive side, online trading has opened up the markets and made them more democratic, while at the same time scores of day-trading brokers have emerged looking to take advantage of market neophytes. Millman's narrative is generally an unfocused collection of anecdotes peppered with commentary. Cumulatively, however, his snapshots add up to a revealing picture of the day-trading landscape. Millman's clear message: day trading is not for everyone, and most day traders lose money. (Nov.)
Copyright 1999 Reed Business Information, Inc.

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Product Details

• Hardcover: 272 pages
• Publisher: Crown Business; 1st edition (November 10, 1999)
• Language: English
• ISBN-10: 0812931866
• ISBN-13: 978-0812931860
• Product Dimensions: 9.6 x 6.4 x 0.9 inches
• Shipping Weight: 1.2 pounds
• Average Customer Review: 4.3 out of 5 stars  See all reviews (13 customer reviews)
• Amazon Best Sellers Rank: #942,524 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

50 of 52 people found the following review helpful:

5.0 out of 5 stars Finally A Book About This Activity That Has Balance, December 16, 1999

By 

taking a rest - See all my reviews
(HALL OF FAME REVIEWER)   

This review is from: The Day Traders: The Untold Story of the Extreme Investors and How They Changed Wall Street Forever (Hardcover)

This is a great book, it does not tell you how to get rich, and it does not tell you that Day Trading is the work of Satan. It gives an excellent concise history about the people who got all individuals the right to trade on their own, and then with examples, and a helpful glossary of terms, gives more than enough information for an individual to decide whether this Extreme Financial Sport is for you. Before reading any other "How To Be A Day Trader" book please read this. Mr. Millman uses the word "Extreme" on the cover of his book and liberally throughout the volume. I trade on-line, have real time quotes, Level II NASDAQ, and many of the other trading tools courtesy of high technology, I do not meet the definition of a Day Trader as I have never had a 50 trade day much less 300 or 500 or even more trades in one session. If you think you are ready for this type of trading a quick calculation may help put Day Trading into perspective. If a person trades from 9:30am-4:00pm, that person has 390 minutes with which to trade. The word extreme starts to come into clear focus. One trade per minute, 390 trades, how about a slovenly pace of 3 minutes for making a decision about your financial status, only 130 decisions need to be made in 6 and one-half hours. Training course of 30 days with some Pros?, $5,000, if that gives you any pause don't attempt this sport. Minimum investment to play at some facilities $50,000 to $100,000, if that gives you any pause stay away. And if you are not prepared to lose consistently when you start, again stay away. You can still trade on-line, and be the master of your own universe, but there is a difference between playing an occasional round of golf and walking up to Tiger Woods throwing down $50,000 and say "You first Mr. Woods". You are going to be trying to make money at the expense of another's loss. You are up against people who have done this all their professional careers, young hotshots who made $1,000,000 last year because, "the video screens are like any video game except these pay". Part of the thirty-day course includes lectures from a psychologist. Now what message is the author not so subtlety suggesting? Do you have the correct form of mental wiring to deal with making a couple of hundred decisions a day, can you handle the constant losses that you will experience, do you have any propensity for gambling. If the answer to the last question is yes, don't go near this game. If you want to trade for yourself, don't confuse a trade or two a day, and staying in stocks for more than a few seconds. Successful Day-Traders are few, like exceptional athletes, or any other occupation that a small number of people have the talent for. On-line trading is fun; true Day-Trading is for the few, not the masses.

11 of 11 people found the following review helpful:

5.0 out of 5 stars Informative, well-researched and entertaining, June 12, 2000

By 

J. Lizzi (Costa Mesa, CA) - See all my reviews
(VINE VOICE)    (REAL NAME)   

This review is from: The Day Traders: The Untold Story of the Extreme Investors and How They Changed Wall Street Forever (Hardcover)

If you're thinking of becoming a day trader, this book is not a "how to" manual, but it's a good start, providing some invaluable insight into the personalities and forces at work in the world of electronic stock trading. Author Gregory Millman uses the term "extreme" to refer to day traders, much in the same way as we might categorize those athletes who master balance and gravity-defying acts to achieve a sporting "rush" beyond that achieved by professionals in the mainstream sports. Look upon the successful day trader in the same light as the skateboarder who had to fall thousands of times prior to succeeding in the X-Games. The only difference is that the skateboarder is more likely to make it big.

Millman has talked to the true movers and shakers in the field, and relies on some great behind-the-scenes research and his experience in writing for numerous financial publications, to bring us a book that is at once a history lesson, an eye into a day trading "boot camp," and even a test kit for the reader to see if he or she is fit (financially, emotionally, etc.) for what may turn out to be the investing (gambling?) craze of the new millennium.

This book is easy to read and quite captivating. Whether or not you're a broker, a "buy-and-hold" investor, a gambler, or just plain intrigued by what all those playing in the stock market seem to be talking (i.e., bragging) about at parties these days, you will enjoy this book. Even the Electronic Traders Association risk disclosure statement was interesting! Millman's style is smooth, and won't trip you up with dry details or obscure jargon. I read this in just a few hours; can't wait for his next one.

9 of 9 people found the following review helpful:

4.0 out of 5 stars Provides good insight into Day trading and Wall Street, January 31, 2000

By 

edge - See all my reviews

This review is from: The Day Traders: The Untold Story of the Extreme Investors and How They Changed Wall Street Forever (Hardcover)

This book is basically divided into 5 parts:

1) a brief history lesson on how electronic markets have evolved and how some savvy investors have pushed the limits to take a bite out of the exclusive realm of the market makers (the people who actually execute the trades and often make a lot of money on the spread between the best offer and bid). 2) Insight into the behind the scences world of everything that happens once a trade is entred into the system. This information alone, should be very interesting to anyone involved in stock trading (regarless of whether its once a month or a 100 a day) 3) The people who sell day trading, day trade or want to day trade and the strategies they each use or try to learn. This section is pretty interesting for both it's content and the characters it describes 4) A review of various legal cases relating to the use and abuse of day trading and day traders. Could be interesting to those into this stuff, I prefered to glance through most of this section 5) A short tutorial on Day trading. Obviously not a complete course, but does provide some interesting tips. (Although I would not quit my day job just yet)

Bottom line, A good read with lots of interesting information for anyone who is involved in stock trading, particulary the section on what happens behind the scences when a trade is exectued.