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on February 15, 2005
Along with its prequel, "The New Market Wizards" is not just a book featuring top traders and their killer strategies that brought about their raging success. The two are no less self-help books giving the much needed pointers to anyone who wants to become a better trader as it repeatedly dissects what constitutes fatal emotional pitfalls and helps readers achieve an acute state of naked realization and, perhaps taken to the extreme, self-actualization. This observation is best captured in Jack Schwager's closing interview with Dr. Van K. Tharp in "Market Wizards": "When people approach the markets, they bring their personal problems with them".

For fundamentalists, "Market Wizards" is the more appropriate book to peruse. My favorite section in the book is "A Little Bit of Everything" where views of long-term investors are discussed at length. The longest write-ups in part one of the series, perhaps purposely so, are also the most useful as interviewees proffered their tricks of their trades with great candor - Michael Marcus (42 pages), James Rogers (38), Bruce Kovner (34), Michael Steinhardt (26). Other concise but equally useful comments were aired by David Ryan (20 - and check out the wealth of investment/trading books mentioned in the interview) and William O'Neill (18).

"The New Market Wizards" is in broad terms a general rehash of ideas propounded in the first book, except that it was more geared toward trading styles than investment techniques, plus the myriad traders highlighted were newer to the game at the penning of the book and in this sense their views less impressive/thought-provoking compared to its prequel where the most legendary / creme de la creme were handpicked to go into the definitive book. Consequently, I find myself picking up appreciably less useful ideas from the second book than I did from the first, albeit Jeff Yass's "The Mathematics Of Strategy" was a refreshing read.

As a summary of Schwager's two extraordinary books on top traders, here's my take on the most important elements that contribute to trading success:

(1) Stringent Risk Control
(2) Hard Work & Tenacity
(3) Know Thyself: Identifying Areas Of Competence & Weakness
(4) Know Thy Investment As Crap Begets Crap
(5) Open-mindedness To New Ideas & Unexplored Angles
(6) Willingness To Acknowledge Defeat & Change Tack When Proven Wrong
(7) Resilience, Courage & Conviction When Markets Go Against You In The Short-Term
(8) Humility To Accept That 'The Market Is Always Right'
(9) Patience To Let Profit Run But Resolution To Run When Proven Wrong
(10) Discipline: Setting Exit & Entry Points/Targets
(11) Defensive/Offensive Behavior: 'Preserving Equity First, Making Money Second'
(12) Fire To Succeed: Total Involvement, Not Haphazard Approach

As a humble contribution, I would like to add two cents as to what defines sound trading mindset:

(a) Investment Is Counter-Intuitive: Obvious Bets Rarely Make Good Investments and vice versa.

(b) On-Going Process Of Analysis & Lateral Thinking: Importance of Leaving No Stones Unturned.

(c) Generosity of Spirit: The More That Is Given To You, The More Is Expected Of You. The common thread that reverberated throughout the books was the interviewees' generosity in sharing their secrets of success and their philanthropic works, along the lines of what George Soros is striving to achieve through his many charitable foundations and for Eastern Europe. While we are very far away from the ideal world where markets are efficient and economic allocations optimal, it is my belief that the more the public is being educated about the proper workings of the markets, the more stable they will be, and this will work for the good of the capital markets and benefit the financial/corporate world in time to come.

All said, these books are a must-read for anyone wishing to hone their skills as traders/investors and derive the positive spill-over of conquering the emotional skeletons in their closets which barred many from leading a more fulfilling life, trading/investing or otherwise. The market is a very sobering place to be where sentimentalism is shunned and those resting on their laurels will be quickly eliminated. Taking the quote from investment maestro, Michael Steinhardt, "...there is no real pattern: anyone who thinks he can formulate success in this racket is deluding himself because it changes too quickly". The resounding cardinal rules and techniques repeated by the top traders ad nauseam in these books are bound to take shape in your investment psyche and stand your future trading and investment processes in good stead.

I only wish I had read the books earlier.
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on October 14, 1998
This book effectively takes the same format as the original Market Wizards. I do not rate it as highly, firstly because I don't think the quality of the traders is quite as high (although they are still very good), and secondly I found the book did not add enough original concepts above and beyond those covered in the first volume. However, this book still contains some excellent interviews; William Eckhardt's discussion of trend-trading systems, and Stanley Druckenmiller's recollections on running the Quantum fund are particularly interesting. Interestingly, Schwager does cover some new ground by interviewing some arbitrageurs and options traders - although these sections are informative, they provide only limited information of use to the position trader/speculator. One grouch I have with this book, and the previous "Market Wizards", is its bias towards trend-following trading. Whilst this has proven an extremely profitable concept for many traders, i would have liked to hear more from contrarian speculators, as well as short-term traders in markets like US T-Bonds, where trend-following techniques are often not as effective as counter-trend trading. Also I would have liked to have seen interviews with some foreign traders - the thoughts of big traders at the Japanese banks on their stock/bond market turmoil in the 80s/90s, or the experiences of traders on the relatively new London Futures Exchange (LIFFE) would have added an interesting international perspective. Despite this I think Schwager has produced another good book, one well worth reading. Don't be put off if you are a novice - this was the first trading book I ever read, and although it didn't all sink in at once, I found it extremely interesting and informative.
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on July 20, 2002
This is the BEST of the 3 volume series. This book was absolutely outstanding and worth not only buying but keeping. I did not like volume #1 at all; there was really nothing in that & I doubted whether the traders interviewed had anything of value to give the reader. This book though is of a much higher quality as it delves more into Trading Systems & their psychology than previously.
A key thing you will learn from these interviews is best exemplified by Mike Carr a Turtle: Don't care what the market will do, Care what you will do when the market does it.
The gem in this series is Warren Eckhardt. In the first book the Ritchie Dennis & Will O'Neil interviews were the real gems. The others in vol#1 were totally without value including the GREAT Ed Seykota who is just a wise-acre with flippant answers and a juvenile sense of humour. Here in volume 2 even minor traders have more to say, perhaps Jack got better in getting information out of them?
Anyhow, remember more than HALF of these people have since gone the way of Livermore and blown up and those that haven't are RETIRED and teach at high costs.
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on April 2, 2005
For entertainment, reading about famous traders of the past; their great trades; their bad trades; their childhood quirks that made them into traders, this book is fun reading.

If you want to learn how to become a disciplined trader, then these famous traders take it in turn to talk about style of entry, risk management, time frames etc etc blah blah blah which you already know about from the thousands of "how to" trading books and this ain't the place for anything new there.

If you think these guys are going to give you the holy grail to become a market wizard by reading this book then dream on. Ed Seykota's stand out rule about knowing the rules and knowing when to break them sums it all up. These guys know all the "rules" but broke their rules at their "right time" and went for the jugular. They went for the home run a number of times and won. Noone can do hundreds and thousands of percentage gains year in year out under strict rule based discplinary trading, so the sad fact is that if you don't often become an undisciplined "pig" then you don't become a "market wizard" hitting astronomical percentage point gains. Looking at it another way, if these guys have the holy grail then a lot of these same people should be in the 2004 Fortune Magazine list of billionaires. They went for the jugular, made their money and got out fast.

There were thousands of big time traders during the 80's and 90's who were consistent, disciplined traders, went for the juglar but they lost. The ones who survived have been interviewed by Jack Schwager. Do you see Victor Niedehoffer interviewed by Jack? Are we all being fooled by randomness?

The best "trader" of them all is the one who had the best risk to reward ratio and has managed to avoid the efficiencies of the markets...good on you Jack....
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on October 9, 1996
This follow up to his best seller "Market Wizards" includes many more insights into many more of America's best Futures and Stock traders. Through candid interviews these self-made mulit-millionaires explain the discipline and strategies involved in trying to wrestle with the financial bull that comprise our capital markets.

We novices who have ever dreamed about becoming a full time investor or just wanted to know how these financial wizards do it, have in this book further proof that fortunes can be made given enough discipline, patience, and sheer stamina.

Each interviewee explains how they place trades, what they look for, and when they exit. The 4 tenets that come up over and over again is: 1) Follow the Trend 2) Cut your losses short 3) Let your profits run 4) Manage risk.

One thing each professional points out is the sheer naivette of the inexperienced trader or investor who comes into the tumultuous financial jungle expecting to make 50 to 100% a year. They are undercapitalized and inexperienced but most importantly do not know themselves.

This is a fantastic book if you want to know how the best of the best tackle our financial markets
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on July 13, 1999
Jack Schwager is a great author. He asks very intelligent questions and seems to have a deep though un-intuitive knowledge of the futures game. (See the CRT interview, overly analytical people mask intuitive traits). The William Eckhardt interview is incredible and should be re-read many times over. This interview alone is well worth the price of the book. I have one major gripe with the author however. Schwager seemed to have had a serious lapse in judgement by including some of the traders that he did. There is no doubt that all the traders interviewed in the book are of high caliber but some definetly cannot be thought of as "Market Wizards". Who am I talking about? Linda Raschke, Tom Basso, Charles Faulkner maybe even Trader Vic. Who is very underrated? Jeff Yass, the man is the best options player around. Druckenmiller, Trout, and Eckhardt are as good as it gets.These legendary names should not be sullied by the inclusion of the above mentioned traders. Schwager left out some amazing traders, what about the people at Kenzie, Niederhoffer ( I know he blew out), Louis Bacon, John Henry, Willem Kookyer and Grenville Craig? Anyone ever heard of Jullian Robertson? Please Jack, if you ever write Market Wizards 3, try to include all or even some of these people. Not traders that you speak with at "Omega" conferences.
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on April 17, 1998
A book with a lot of hype. When direct questions were asked of turtle traders, ALL refused to answer except one who does in generally vague statements. However the author does admit after all the interviews that there are no real trading advice given in the book, but just trading psychology which in my terms are just more ways to confuse the readers...Moreover, not really suited for anybody who trades. Period. I say this because of 3 reasons: First, all of these traders who tell of their way of thinking, is theirs and tailored personally to their trading ideas and plans--it may not be suitable for anybody else. Second, most of these traders can cut back on trading, still be in the markets and make money and take losses and suffer large drawdowns in order for the trades to work, most of us will never be in that position, nor do we manage millions or even billions in funds. And third, the big traders don't really need to listen to others. They're big themselves already. The little guy really can't move the markets much at all without deep pockets. Warren Buffett can and did so with silver in Feb. 1998. The book really comes down to the big boys keeping the secrets to themselves and telling us to practice good money management and develop our own trading plan while the reader can read and awe the interviewees like they're some idol or god....would not reccommend.
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on June 20, 1999
If you haven't read "Market Wizards" (the first book), go ahead and get that first. The caliber of traders is not as impressive, and there is very little new information to be learned. Still a good book nonetheless.
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on July 3, 2002
Through a series of interviews, Jack Schwager introduces the readers to traders he deems to be Market Wizards. He talks to people trading in different markets, employing different methodologies, and exhibiting different strengths and weaknesses. In spite of the differences, Schwager identifies some commonalities. Schwager sums up the book by offering his takeaways for being a successful trader. Some of them are quite obvious (e.g. have a passion for trading and examine your reasons for trading, have an edge) while other are more subtle (e.g. match your trading style with your personality, have a method).
Having attended a lecture given by him, Schwager will be first to tell you how he had to modify his trading style and methodology to a quantitatively-driven one. Before the change, he felt that he lacked the discipline to exit his positions subjectively.
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on January 12, 2001
Some readers comment that "The new" is not as good as the old. I strongly disagree with that. Schwager had tried to get the rest of the best in the market at the time to be interviewed and written about, like Vic Sperando, Stanley Druckenmiller, Richard Driehaus and some other big names. The problem is: the "stars" in the first book are just too bright, amongst all else, Paul Tudor Jones and Richard Dennis. Perhaps Schwager should have got Soros to meet the market expectation. BTW, two more tips: First, buy and read the Market Wizards before this. Second, dont get too carried away by the rosy pictures posed by these top traders and dont copy a bit from each of them. Know yourself and develop the trading strategy that fits you most unless you want to be those footstool of these wizards.
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