Customer Reviews

The Zurich Axioms

5 star:		(25)
4 star:		(3)
3 star:		(3)
2 star:		(3)
1 star:		(0)

 

 

I love books on risk management, especially when they differ from mainstream opinion of what is correct. And they are even better when they make total sense like this book does.

Max Gunther writes about the 12 major and 16 minor axioms handed down to him by his father, a swiss banker/speculator. I believe if you follow these axioms you can be very successful, or at least not lose everything you have worked hard to gain.

The first axiom is on risk. Max tells some good stories about people that risked, alongside those that played it safe. You can probably guess who did well in the long run. The minor axioms for risk talk about always play for meaningful stakes and resisting the allure of diversification. Meaningful stakes is a problem for many traders/investors. They take trades that are low risk and low reward, when there are plenty of slightly higher risk and much higher reward trades available on a daily basis. And lets not even get into the subject of diversification, that kills many accounts. Most truly successful people take the opposite aproach to diversification, they put all their eggs in one basket, and then keep a very close eye on that basket.

The second axiom is greed, one of my personal favorites. Max talks about always taking your profit too early! I really like his take on profits. I have had way too many times where I was making great money on trades and then sat on my hands waiting for it to go higher. Thats usually when the bottom falls out and you end up with less than half the profit you would have had if you got out "too soon". The minor axiom for greed is to know what your target profit level is in advance, then to get out once that number is hit. Great advice.

The other axioms are on;

-Hope - When the ship starts to sink, don't pray, jump.

-Forecasts - Human behavior cannot be predicted, distrust anyone who claims to know the future.

-Patterns - Chaos is not dangerous until it begins to look orderly.

-Mobility - Avoid putting down roots, they impede motion.

-Intuition - A hunch can be trusted if it can be explained.

-Religon and the occult - It is unlikely that Gods plan for the universe includes making you rich. (plus God must really love poor people, afterall he made so many of them)

-Optimism and pessimism - Optimism means expecting the best, but confidence means knowing how to handle the worst.

-Consensus - Disregard the majority opinion, it is probably wrong.

-Stubbornness - If it doesn't pay off the first time, forget about it.

-Planning - Long-range plans engender the dangerous belief that the future is under control. It is important never to take your long-range plans, or others plans seriously.

This book is packed with value. It will not lead you to investments or speculations, but it does lay down some of the all-important groundwork so you can go into money making opportunities with the correct mental outlook. This book has earned a place on my very short list of important books.

This book really opened my eyes to the importance of taking risks and taking one's losses gracefully and quickly. The book also speaks about the risks of so-called low risk approaches. If one doesn't have much calculated risks are the way to go. The book is positive and upbeat. I read it more than 10 years ago and it is a book I turn to again and again.

No nonsense clearly articulated principles of investing, devoid of technical jargon, unsupported theories and self-congratulatory braggadocio. The book is written in an engaging, mildly cynical way that resembles a father teaching his son the main principles of the investing process - as the author apparently learned them from his Swiss banker father. The main topic is the mindset and philosophy of successful speculators and investors and the major traps to watch out for when engaged in this activity. Very general advice - there are no spesific recommendations for any stocks, etc. This is an outstanding book for individuals who want to develop a rational basis for their investment activities.

This book seems to be a novel, not an investment book. The author tells several stories, for example, the person that had refused to sell his house only to have to sell it later for half the price.

Gunther says he is a son of a Swiss banker and asked his father to explain him how to make money.

He tells you to believe in NO method of analysis, so that you will find NO quantitative methodology here. But he offers several interesting Axioms, each addressing an human emotional frailty. And illustrates them with "Cases".

He tries to demolish Fundamental, Technical and even Academic Analysis. He compares investments to gambling and that is why I gave it 4 stars. I think some analysis techniques are undoubtfully valuable.

I think you need to have a methodology. His advice about when to sell is: "Sell too early". I ask: How early ?

You could not rely only on it to make informed decisions, however you will certainly laugh (or cry) too much when reading it.

Everyone's got to start somewhere and Max Gunther helped me get my start in the world of speculative investing. Of course, when I began trading in the stock market (pre-1987), I thought I was going to set the world on fire and make tons of money in the market in short order.

I didn't exactly set the world on fire, but, over time, I grew as an investor, and more importantly as a business person, via contemplation of the rules set forth in The Zurich Axioms.

Today I'm more an investor than speculator and a re-read of The Zurich Axioms showed me just how much I've changed over the years. I still agree with much of what Gunther conveys, but disagree with more than I thought I'd ever disagree with when I first read it years ago.

For me, The Zurich Axioms is a great resource when learning to grapple with risk, market forecasts, and the emotional roller coaster of Wall Street.

Bottom Line: While The Zurich Axioms is more than a worthwhile read, the best rules for anyone will be those that they develop for themselves.

Each principle deals with an emotion, and a possible error. Some of his language you may quibble with. Investments involve chance and probability, like gambling, but the expectations are on your side and you might be doing collective economic good, rather than just your entertainment.

I am a managed futures investor, and find this a useful book to read every few years to reground my perspective on risk management. You can do all the calculations and due diligence you like, but in the end it is your judgment, instinct and probabilities.

The book has become rare a few times and quite expensive at the rare book shops.

This little-known book is one of the best I have ever read on speculation in the financial markets (and by extension, life in general). I own hundreds of books on the markets and I surprised that it took me so long to even hear about this one. Buy this book! It is one of the best.

I got this book on a recommendation from a friend. It gives you simple, to the point advice on investments and goes against most other "expert" opinions out there. It basically tells you that if you don't risk, you won't get rich (unless you are naturally lucky, but who really is?) and if you want to risk, know what you are doing. This book has been out of print in the US (don't know why) but you can get for about 18 bucks, shipping included, from Amazon UK, no need to buy from a 3rd party.

This book is filled with gold. It is fun to read and you may not even notice how much valuable information you will find in each page. The axioms cover so many areas of human psychology and trading that you may only later realize what you have in your hands.

It does not go into details about trading strategies, money management (apart from the basic but fundamental ones such as "cut your losses" and "realize your profits early") and position sizing. But this is not what this book is about. It is an eye opener with key fundamental ideas and principles that you will soon or later find more than essential.

Two of the many fundamental principles stated there that many people ignore - and many may not see their full value at first reading (or even later!):

- do not diversify your capital allocated to risk investments if your goal is growth,

- to invest is essentially to speculate.

You will be more than excused to read about speculation when others think that you should be reading about investing. You will understand why.

Yet it is not a perfect book. It gives no value to any kind of technical analysis or trading system. But it is so, because it does focus on a healthy scepticism - which is without doubt better than taking the opposite side! So its shortcomings are forgiven.

Not often will you find this kind of information packed in a concise, straightforward and fun-to-read style. A great book! Highly recommended for just anyone.

Gives you concise to the point guidelines about getting started in trading in financial markets. Reviews a number of commonly accepted investment ideas and puts them into a new and refreshing (as well as profitable) perpective. Recommanded reading for everybody who is serious about making money in the markets.