Trading for a Living: Psychology, Trading Tactics, Money Management (Hardcover)

by Dr. Alexander Elder (Author) "Trading appears deceptively easy..." (more)
Key Phrases: trading rules, slow stochastic, fast stochastic, Force Index, Triple Screen, Bear Power (more...)

Editorial Reviews

From Library Journal
Soviet-born author and practicing psychiatrist Elder (director, Financial Trading Seminars, Inc.) shares his learning over the years as a professional trader and expert in technical analysis and his principle of understanding the three Ms (Mind, Method, Money), which will strengthen the discipline required to be successful in trading. He explores crucial factors in the markets that most experts overlook, including time, volume, and open interest, and describes little-known indicators to track them profitably. In addition, he covers many of the more technical approaches to investing in futures, such as factoring in the meaning from the Elliott Wave, oscillators, moving averages, Market Logic, and point-and-figure charting. His unique viewpoints in this overly saturated genre explain his particular view that most traders sabotage themselves, while offering tips for others to avoid doing the same. The narration by Richard Davidson soundly guides the listener through this highly specialized work that, although first published seven years ago, remains recommended for university libraries supporting a finance and business curriculum.DDale Farris, Groves, TX
Copyright 2001 Reed Business Information, Inc. --This text refers to the Audio CD edition.

Product Description
Trading for a Living Successful trading is based on three M’s: Mind, Method, and Money. Trading for a Living helps you master all of those three areas:

• How to become a cool, calm, and collected trader
• How to profit from reading the behavior of the market crowd
• How to use a computer to find good trades
• How to develop a powerful trading system
• How to find the trades with the best odds of success
• How to find entry and exit points, set stops, and take profits

Trading for a Living helps you discipline your Mind, shows you the Methods for trading the markets, and shows you how to manage Money in your trading accounts so that no string of losses can kick you out of the game. To help you profit even more from the ideas in Trading for a Living, look for the companion volume—Study Guide for Trading for a Living. It asks over 200 multiple-choice questions, with answers and 11 rating scales for sharpening your trading skills. For example: Question Markets rise when

there are more buyers than sellers

buyers are more aggressive than sellers

sellers are afraid and demand a premium

more shares or contracts are bought than sold

I and II

II and III

II and IV

III and IVAnswer B. II and III. Every change in price reflects what happens in the battle between bulls and bears. Markets rise when bulls feel more strongly than bears. They rally when buyers are confident and sellers demand a premium for participating in the game that is going against them. There is a buyer and a seller behind every transaction. The number of stocks or futures bought and sold is equal by definition.

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Product Details

• Hardcover: 289 pages
• Publisher: Wiley; 1 edition (March 8, 1993)
• Language: English
• ISBN-10: 0471592242
• ISBN-13: 978-0471592242
• Product Dimensions: 9.1 x 6.3 x 1 inches
• Shipping Weight: 1.2 pounds (View shipping rates and policies)
• Average Customer Review: 4.5 out of 5 stars See all reviews (201 customer reviews)
• Amazon.com Sales Rank: #5,697 in Books (See Bestsellers in Books)

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Customer Reviews

Most Helpful Customer Reviews

176 of 187 people found the following review helpful:

5.0 out of 5 stars If you are halfway from an amateur to a pro, it's for you, April 6, 2003

By	ServantofGod - See all my reviews (TOP 500 REVIEWER)

If somebody bought, read and judged the book by whether it could really help him or her to go "trading for a living", that somebody would definitely be disappointed. Even the author himself pointed out that the success rate for the conversion of ex institutional traders to independent traders was very low owing to the much higher psychological load of trading one's own money than that of trading OPM.

Despite the over-promise of the book title and the second half of it discussing mostly technical tools, the book is quite well written. There are plenty of bright ideas, some with originality that can be attributed to the author's M.D. and psychiatrist background. In particular I like the following points much:-

- That trading is a minus sum game (considering commission and slippage) and the mass media or gurus or prevalent market view are almost always wrong.

- The analogy of the market as an ocean and a huge crowd of people, in either case an individual can have no control of but have to follow (or leave) emotionlessly for long term profit.

- The analogy of Alcoholic Anonymous with Loser Anonymous that requires the same treatment for true recovery, whereas accepting oneself as an alcoholic or a loser is the very first step of healing.

- The need for discipline and patience as individual traders' only weapon to against institutional traders advantages in faster information, better research reports, lower psychological burden for trading OPM, etc

- Price is a psychological event, a momentary balance of opinion between bulls and bears, its pattern reflects the mass psychology of the market.

- Last but not least, the opening prices are determined primarily by amateurs whilst the closing prices are determined by professionals.

In short, the book is well worth the price and I do recommend it to those who study continuously for self improvement in their trading. Remarks:- The author claimed that he personally did so, too.

86 of 89 people found the following review helpful:

5.0 out of 5 stars 'THE' Best Book on Trading, April 27, 2001

By	Ron Jackson "Ronald Russell, Author of "D... (Los Angeles, CA USA) - See all my reviews (REAL NAME)

2 Years ago I became a full-time trader after taking several courses and reading more than 40 books on trading. Dr. Elder's book is the ONLY one that has made me money, a lot of money (603% last year).

The first half of the book deals with the psychology of both the market and the trader. I didn't fully appreciate this portion of Dr. Elder's book until I began trading. This is the biggest obsticle of the trader. His insight has really helped me to understand the movements of the market and myself as a trader.

The second half of 'Trading for a Living' deals with technical analysis and money management. This has proved invaluable to me. There is so much accurate information I've read the book eight times, that's how jam packed it is with useable information. Also, every word matters--no fluff at all--unlike most of the books on trading I've read. And, don't overlook his money management chapter. This is where amatuers fail. His simple money management system will help to elivate you to a professional trader. If you want to make money, this is the book.

72 of 75 people found the following review helpful:

5.0 out of 5 stars Wonderful!, October 18, 2000

By	Michael Mendenhall "september17th" (Monterey, CA United States) - See all my reviews (REAL NAME)

Every now and then someone writes a really good book. This is one of those. It's pricey, but it's worth it.

At first blush I thought, what's a psychiatrist doing writing a book about trading stocks and commodities? On second thought, what does a psychiatrist know about the financial markets anyway? Therein lies the genius behind this book. What amateur stock and commodity traders fail to realize is how psychological the whole market is. The biggest enemy of the stock trader is not the market, it's what goes on inside the trader's head. The first few chapters in this book were priceless. It was all about psychology. If you have ever tried investing and lost a lot of your money, he will tell you why. He described my early trading right down to the thoughts that went through my head as I continued to lose on trade after trade. It was eerie.

I would say that this book is split into two parts. The first part is pure psychology. That may turn off some people, and that's a shame. As the author points out, so many people who are educated think that because they are "school smart" that they must be able to master the financial markets just as well. It's all numbers right? Nope. It's psychology. It's the psychology and the mentality that goes into it. The author likens a typical losing trader (in other words, most traders) to an alcoholic in denial. Traders are addicted to losing money. They get such a thrill from trading that they don't care if they win or lose. It becomes a game if you will. One where most people lose unfortunately. There's some really good observations in here. It really opened my eyes.

The second part of the book, which is really the bulk of the book, is various trading strategies and technical information. If you're an experienced trader, you'll recognize most of it. I got confused with all the scientific explanations having been reared on the "buy low, sell high" and "short high, cover low" school of thought. I think the author did an excellent job of covering a wide variety of strategies and trading tools. If you're new to trading, it may confuse the daylights out of you. If you have some experience trading, this book will be immensely helpful. I found more than a few good nuggets in here. There were a few things that I had suspected and one little known trading strategy that I discovered on my own that were confirmed for me. Sometimes we notice patterns on our own, and it's good to have someone with experience like this confirm it. I even found out they have names for some of these things that happen in the market.

Overall, I think this is an excellent book. If you've ever lost money in the market, read this book, especially the first part about the psychology of trading. It answered a lot of questions and cleared up a lot of issues for me. When the market is going down and performing miserably, and you're losing your you know what in the market, those chapters will really help out. Losing in the market is nothing personal. We all fall victim to the same emotional trading issues.

One thing should be pointed out. This book switches between talking about stocks and commodities. Keep that in mind if you've never traded commodities but trade stocks. I got confused at times with some of the words until I realized he was talking about commodities and not stocks. I haven't traded commodities in over a year and a half, so some of the terminology slowly came back to me.

I'm giving this book five stars because it is that good. I wish they would publish it in paperback like the study guide that goes along with it. If you don't mind the high price, get it. Then again, I spent over twice the price of this book this morning on stock commissions alone, and I trade with one of those ultra low priced discount Internet sites. It's all a matter of putting things in perspective I guess. Get this book. You won't be disappointed.