Customer Reviews

High Probability trading

5 star:		(74)
4 star:		(18)
3 star:		(10)
2 star:		(7)
1 star:		(5)

 

 

I've read some of the reviews (or should I say criticisms) of this book. They write that it's for beginners, there are just a couple of setups, and the obligatory discipline "cut your losses" warning chapter. I think people are missing the big picture.

If you want a detailed book about technical analysis, with lots of explanations, setups, etc. etc., there's "Technical Analysis Explained" by Martin J. Pring, or you can buy something by Jack Schwager or John Murphy.

If you want a book about building and testing a trading system, there's "Trade Your Way to Financial Freedom" by Van K. Tharp.

If you want a self-help book about discipline / psychology, there are a lot of those, some in the investment section, some in the psychology section.

If you want a book about day-trading, there are a ton of those as well.

The thing I like about this book is that everything is there in one place. At the end of each chapter, the author gives you pointers on what to do and what to avoid doing to reinforce your memory of the principles. The book is written in a very readable style. I got this book about three weeks ago, and by applying some of the principles I learned from the book, I made two profitable trades (which I would not have normally made) and avoided making a trade which I normally would have made. This trade would have been a loser. As a result of reading this book, I made and saved enough money in the last three weeks to buy ten copies of this book. Isn't that why we read these books???

This is probably one of the most realistic books on what it takes to trade professionally. The author starts by correctly stating how difficult it is to trade successfully. He gives a time frame of 3 to 5 years, although he states it took him seven years to be consistently successful (he refers to himself as a slow learner).

He also discusses unrealistic expectations of beginning traders, who typically open accounts of $10,000 to $25,000, and expect to make a living trading such accounts. The author notes that the best fund managers on Wall Street, who can consistently return 35-40 percent, command salaries in the seven and eight figures. Even if a beginner could produce such returns their first year (extremely unlikely), could they live on 40 percent of $10,000? When Wall Street investment firms want to hire a trader, they go to the best business schools, recruit the top graduates, pay them maybe over $200,000 their first year just to sit in training classes for months. They tell these trainees they do not expect them to make any money for at least two years, and these are individuals who have access to some of the most experienced traders on Wall Street. When they do finally start trading, they are closely watched and given only modest amounts to trade. Would you be surprised to know that the average professional trader is successful on only approximately 50% of their trades? With some futures trading systems, it is closer to 30 percent. This is why taking losses quickly is the single most important aspect of successful trading.

The book also covers the basics of trading systems, including indicators, stops and exits, typical trading system characteristics, backtesting and system writing.

While he also touches on trading psychology, this is the weakest part of the book, and is mostly biased towards his own hurdles, which were taking too large a position in too many different markets. He refers to this as "overtrading", although I would define overtrading differently. For those looking for a book on trading psychology, try Mark Douglas' books, such as "The Disciplined Trader", and "Trading in the Zone".

Finally, the book is interspersed with anecdotes about real trades and traders, which are invaluable about how not to trade, and are often hilarious. One example, the author stated he once held positions in 15 different futures markets at one time on a $5000 account, although this seems impossible, if one was to meet the margin requirements of each market.

At the risk of being repetitive, I'm going to have to give this book another stellar review. Like many others, I have read a hundred other trading books and this one stands heads above the rest. The author is obviously an active trader and is not ashamed to divulge his weaknesses, even current ones. He covers all of the necessary bases (psychology, money management, risk management, setups, tradeable markets, etc.) without being exessively wordy. He is one of the few traders who can actually write relatively well. He manages to explain arcane and complex trading concepts using understandable and economical word choices. The review structure at the end of each chapter is an excellent technique to enhance the learning process.

Yes, most of the information is more useful to the novice trader but one neeeds a basic comprehensive understanding of trading to get the most benefit. On the flipside, since it is so inclusive, the book could serve as an excellent refresher for the seasoned trader. That trader might even come across a concept long forgotten and be able to turn it into a profitable strategy.

HPT has become my primer. I come back to it every few months to review sections that I feel weak in. I recommend this book to everyone who asks me for that "one book" that can get them a head start in learning to trade.

Great job Mr. Link! I eagerly await your next contribution to the world of trading literature.

I would re-title this book to read, "Basic Trading Concepts". The book is nicely put together and does provide a good deal of information but the title is totally misleading in my opinion. Most of the material provided is general trading knowledge and not specific "high probability trading" methods. I was expecting actual techniques and specific entry and exit systems. If you're new to trading, this book will give you the basics. If you have been trading awhile, this book is mostly milk and no meat.

JD in Pennsylvania

I had read tens if not over a hundred trading books (and written many reviews here on Amazon), This is by far the best I ever picked. It really helps!

The author had covered most of the topics that should be included in a compleat guide of trading (trading psychology, uaage of TA, money management, trading system development....). Some of his key points are:-

1. Top traders are essentially pro gamblers who only bet when the odds are in their favor.
2. Trading must be dealt focusedly as an entrepreneurial business with loss (must be relatively smaller than profit) taken emotionlessly as regular business cost.
3. Good money management is the common denominator of all successful traders irrespective of their style.
4. TA is bascially a trend/fact finding process to be searched through multiple time frames, verified with different indicators, and that TA can be applied on indicators as well (trendline in MACD, and CD between price and MACD)

I personally like the no nonsense and humorous writing of the author much. The summary and point form "do's and dont's" in the end of every chapter did help me to memorise what I had studied for long. His clever use of graphs in the TA tools section is really outstanding. Believe me or not, his use of less than 10 pages on the explanation of MACD is a lot more powerful than many TA books that used up over 100 pages on this single topic.

In short, it's a must read for any player who wants to improve his/her edge over the ocean of competitors in the market. My salute to the author who writes me this excellent book.

For starters, I do not want to pick a fight, and I am not saying this book is by any means perfect, but I hope no one is influenced by Larry Livingstone's review dated May 18, 2006. In case you don't know, Larry Livingstone is the character in Lefevre's classic, "Reminiscences of a Stock Operator", which is itself a slightly fictionalized biography of the very real Jesse Livermore. Just so you'll know. Read his review and then come back.

Again, without spending my entire review responding to the "Larry's" criticism, let me just say that if you actually read the book, these criticisms will vanish. Link is not advising traders to be loose and wild and not worry about blowing your account, as "Larry" seems to imply, rather he is stating an undeniable, plain fact....many successful traders have at one point blown their accounts.....period! Cold, hard reality. Yes, me included. Had I read this book, however, I might have prevented that. "Larry's" other cherry-picked criticisms will fade away when you read the book and understand the context of some of the quotes "Larry" provided.

Moving on....as I said this is probably the best trading book I have ever read. As opposed to books like "The Master Swing Trader", this book is very well written (like it or not, this is important), very easy and interesting to read, very practical, and very informative. Nor is he a big Wall Street fund manager (at least the book is not written from that perspective) that operates in a completely different world than the average trader. It is a very practical and realistic book that you will be able to relate to. I have read many trading books including Market Wizards and Reminiscences, and I highly recommend them, but in reality how many of us actually operate at that level? These are good books and you should read them, but Link's "High Probability Trading" is aimed at the small trader and it will have an immediate impact on your trading.

Yes, most of what he teaches can be found elsewhere, but my response is that it can be found here too; and as I said, he brings it to you in a way that you can relate to and it will help you really understand the why and the how. Just having a list of rules is not as good as having someone give you a very good example of how to implement the rule and what can happen if you don't. This is why, in my opinion, High Probability Trading, for the average trader, is even superior to books as acclaimed as Market Wizards and Reminiscences.

Link's discussion of technical indicators is very brief, but I have to say it was in some ways far superior to other, much longer, items I have read about them. What he does better than others is that he shows you how to apply them. He gives you the proper uses, and limitations, of these indicators. Not many writers do that.... some make them out to be a crystal ball, while others tell you that they have no place whatsoever. I would disagree with both.

Link does not try to build himself up in this book like some writers do, rather he is very honest about his growth as a trader, which I find very refreshing. He tells some stories about his experiences, good and bad, his mistakes, his successes, his emotions, that you can immediately relate to. You will find yourself saying, "Yep, been there... done that."

Although the book is very well written and easy to read and understand, the main reason I found it to be the best book on trading I had ever read is very simple...... it was the most realistic book on trading I had ever read.

Unless you are already at the top of the trading world and can condescend to the rest of us, I suspect you will disagree with "Larry" and find this book very helpful. I wish I had read it about 5 years before it was written..

One other book I highly recommend is Stanley Kroll's "The Professional Commodity Trader". This book is a sleeper. Again, it is very well written and is very interesting to read.

Probably the best practical how-to book on the subject of daytrading stocks, indices, and futures contracts.

It's all technical - that is, chart-reading - but you get a much clearer idea of how to actually trade using a chart than you do out of all the classic technical analysis books. There is nothing in this book about chart patterns (triangles, cups, flags, etc.) or about candlestick formations. Perhaps the author doesn't consider those things worthwhile, but personally I find that knowing about them is at least helpful.

His mantra is trading with the trend of a higher time-frame than the one you are trading in and basically trying to capture the meat of the next wave after a correction in the direction of that trend in your trading time-frame. He uses trendlines and channels to find the best entries and exits. If there is no trend then you are in a range-bound market and should play the range reversals at the extremes - when this fails be prepared to play the break of the range without chasing it, which usually means waiting for a pullback (in which case you have now switched back to trend-following tactics). Breaks of channels in the higher time frame create a reversal in trend and are played in a similar manner.

There is alot of material on using oscilators correctly, especially Stochastics - not just looking for reversals when it crosses and turns from overbought and oversold like most people use it. He shows how it can be helpful in both trends and range-trading.

Interestingly enough, he includes some examples of "high probability trades" that are against the trend as well - although he always goes back to saying you are better off sticking to trades with the trend. (There are a few seemingly contradictions like that but this is still a great trading book.)

Link stresses over and over that top traders will have 50% losing trades. So what trading boils down to is a probability game like poker or backgammon. Your average winner has to be significantly higher than your average loser - and that's where picking the good setups comes into play. So you want to be stepping in where different types of traders and investors in different time frames all get signals in the same direction and will act as a collective force to move the market because of it. Even with that, still expect 50% losers so these spots must have reasonably tight stops that still give the market wiggle room but when the move happens it will usually be sustained enough to make up for all the losers plus some.

Link also acknowledges that it doesn't matter how large or small your profits are when you take them as long as you are systematically taking even smaller losses. This opens one's mind to different approaches that can all be successful.

The book lacks a clearly defined trading plan - it is up to the reader to develop one of his own from these concepts. But the building blocks of a successful plan are certainly contained herein.

[...]

Although the book's content is good and interesting, it is totally unsuitable for reading and studying on the Kindle.
As it is all about charts, analyses, details, it is very (!) annoying not to be able to see or read the charts on the kindle approprietly. Also the browsing/moving forth and back between the charts and text is irritating.
This is not the author's mistake but Amazon's.
Amazon should warn its customers for this!
I just bought the paper back version of the book, but now have double costs of course...

I've been trading for 15 years and I read as many trading books as I can, and I found High Probability Trading to be one of the best yet. There is no bull or get rich quick trading system in this book, instead the Author lays out some simple but often over looked principles of how to become a better trade. For example he stresses that trading with trend has always been the way to go and one should not get to fancy by trading the counterwaves. Its a simple prinicple but one that I can forget about at times. This book was a great refresher and taught me a few things about my trading, i highly recommend it to any trader.

Different trading books cover different aspects of trading, like risk, execution, or psychology. This book covers all of that and more. It is one of the few complete books on trading I have read so far. I don't think you can read this one book and become a great trader, but I do think it starts you in the right direction and if you follow what Marcel is saying you will be a better trader.

I also think if you are already a successful trader there are many things in this book that can help you to become even more successful. I first read this book about two years ago. Learned some good things from it and then put it on my shelf of trading books. I pulled it back off the shelf about a week ago and started reading it again. I am glad I did. There are so many pearls of wisdom in this book that I had forgotten, or just stopped using over time. Sometimes we need to be reminded so we can continue to improve.

Marcel appears to be a real trader. That's a good thing because there are many trading books out there written by real authors, not real traders. The wisdom he lays down in this book are the bits and pieces he learned through his trials and errors over years of trading.

Here are some of the things I took away from this book.

-Trading is the hardest job you will ever have. If you think you are going to just walk over to your computer, turn it on, and then buy or sell your way to riches without any preparation, you are sadly mistaken. If someone tells you it is easy, ask to see their audited statements for the past few years.

-Be realistic about the time it will take you to become successful. It will probably be 2-5 years of diligent work before you can become a successful trader. Some people can do it in less time, others will need more time. A doctor, lawyer, or other professional cannot become an expert in their field in a couple of months. Why would you think you can do it in a field like trading? Something else to learn from doctors or lawyers, the really successful ones specialize. You cannot trade every market, so find the ones you are good at and specialize in those areas. That's the way to happiness and profits.

-Learning to trade is a timed race. You need to become successful before you run out of money. Its just like a new business, you need to make money before you go broke. Treat trading as a business and you will be more successful at it.

-In the beginning it is much more important to learn how to not lose money than it is to learn how to make money. If you keep from losing money you lengthen your learning time. No money means no trading. You have to preserve your precious capital. Plus once you learn how not to lose money, you start getting better at realizing how to make it.

-You need to have the proper capital to succeed, or you need to have realistic expectations for the capital you currently have. You should not be trading four e-mini futures contracts on a $10,000 account. It would put your risk level way too high and lower your chances to succeed. Proper risk levels are vitally important.

-Never take a trade that you cannot explain. You need to understand why you are getting into a trade. There are tons of trades every single day. This book is about taking the high probability trades. Why take a low probability trade when all you need to do is be patient and a higher probability trade is right around the corner.

-Trading against the trend is a low probability trade. Why not place the odds in your favor by trading with the trend?

-Trade the market, not your P/L. Trade what the market is showing you. Do not trade because you need to make a mortgage payment or car payment. The market is very generous and gives you many opportunities each and every day to transfer some of its money to your account. Wait patiently and be prepared to act when those opportunities arise.

-Always have a stop-loss. That means a hard stop you place the second after you put on the trade, or a mental stop that you will execute without fail if the market hits that number. A stop-loss just lets you know the trade is not what you are expecting. A small loss is part of the game. Do not let it turn into a large loss. Some of the best traders are only right about 30-40% of the time. And they make millions by only taking a small loss when they are wrong and letting their profits run when they are right.

-Risk. You need to set proper risk levels and always follow them. You will never know ahead of time which trades will make money or which trades will lose money, so you need to have proper risk levels at all times. Improper risk levels are one of the most critical reasons that new traders fail. By risking too much they never give themselves a fighting chance to be successful in the markets. New traders have not figured out their edge, they have not dealt with their own psychology, they have a dozen reasons why the trade is wrong, but with improper risk levels they get too few chances at learning the correct way to trade.

-Psychology. Whole books have been written on this subject. Marcel hits many of the important ones in his life, they will probably help you out too. This is a very important subject that you must conquer to be successful. For some it is easy, others will work on it until the day they die. I once read somewhere that "The market is an expensive place to learn about yourself". It's very true.

I can easily say that this book is in my list of the five best trading books. It deserves to be read more than once. Maybe once a year if you are actively trading. I would like to be able to give a brief description of the highlights of this book, but this is an all-encompassing book on trading. It covers everything that the majority of traders need to know and understand. If you follow what Marcel talks about in this book, you will have a high probability of succeeding in your trading career.