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Trading Realities: The Truth, the Lies, and the Hype In-Between Hardcover – October 24, 2010
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From the Back Cover
“Jeff Augen is truly a unique voice and mind in today’s financial discourse. He has a knack for translating intricate economic and market interrelationships into easy-to-understand ideas and has a way of seeing patterns and cause-effect relationships across markets. For those who listen, there is much to learn and much from which to profit. Ultimately, he gives individuals a fighting chance to participate in the markets to their advantage.”
--H eather L arson -B lakestad , Executive Editor, Stocks, Futures, and Options Magazine
“Jeff is a true scientist who has turned his formidable skills to the markets. His systematic research and open mind have led to a series of insights that are stunningly original and an investment philosophy based on facts, with no time wasted on mere conventional wisdom. Following Jeff’s thinking can help any investor avoid many costly blind alleys and develop a strategy based on how markets actually work.”
--R obert B irnbaum , former hedge fund president
“Jeff Augen reveals the ‘ugly truth’ that everyone investing in the markets needs to hear and also applies the lessons to the real world of trading. He attacks popular myths, notably about whose fault it is when investment decisions lead to losses and who gets credit for being a wise investor. The tie-in between investment/trading strategic thinking and well-explained economic reality is refreshing and extremely valuable.”
--M ichael T homsett , author of Put Option Strategies for Smarter Trading and The Options Trading Body of Knowledge
Today’s financial markets are complex and dangerous. The value of individual investments is now more strongly influenced by world economic and geopolitical events than by the underlying fundamentals of the company being invested in. Layered on this intricate web of forces is the impact of high-frequency computer trading programs that enter and exit trades in a fraction of a second and drive 60% or more of the market volume on any given day. Trading Realities provides investors with new skills and approaches to succeed in this environment. Without this enhanced knowledge, investing is no more than gambling.
Writing for beginning and experienced investors alike, successful trader and author Jeff Augen focuses on the powerful forces that really move markets: the dynamics that are fundamental to your success, no matter which strategies or asset classes you choose. He provides new approaches to identifying market trends, exploiting global economic forces, trading the news, valuing risk, and dissecting economic reports released by the government.
You’ll learn how to gain a clear advantage: an advantage you can sustain through any market environment.
- Invest with the markets, not against them
Leverage the “mega” forces that drive all markets, in all market environments
- Why markets always move in the direction that damages the most investors
... how to recognize that direction and move with it
- Why even experienced investors overrate their knowledge and skill
What you really need to know before you make an investment
- How to clarify and compare the real risks of potential investments
Getting past the myths of risk and leverage and understanding the realities
About the Author
Je ff Augen, currently a private investor and writer, has spent more than a decade building a unique intellectual property portfolio of databases, algorithms, and associated software for technical analysis of derivatives prices. His work, which includes more than a million lines of computer code, is particularly focused on the identification of subtle anomalies and price distortions.
Augen has a 25-year history in information technology. As cofounding executive of IBM’s Life Sciences Computing business, he defined a growth strategy that resulted in $1.2 billion of new revenue and managed a large portfolio of venture capital investments. From 2002 to 2005, Augen was President and CEO of TurboWorx Inc., a technical computing software company founded by the chairman of the Department of Computer Science at Yale University. His books include Day Trading Options, Trading Options at Expiration, The Option Trader’s Workbook, and The Volatility Edge in Options Trading. He currently teaches option trading classes at the New York Institute of Finance and writes a weekly column for Stocks, Futures and Options magazine.
Top Customer Reviews
I'm not entirely sure what the point of this book was. I think it was to present option trading as a better path for trading the stock market than actually trading the stocks themselves, but I can't be positive. The author does do a pretty good job of laying out some option strategies that could be used along with or in place of holding stocks, and I definitely agree that for many people they present a better path (I for one have been trading options rather than stocks for quite a few years). That's just one chapter out of seven, though.
Focus aside, I have a few major issues with the book.
First, there are things he says in the book which are flat out incorrect. One of them is very early on and very obvious for anyone familiar with the currency market. He suggests that during the major dollar weakness a few years ago the Yen reached a value of $1.15. The fact of the matter is that the Yen has never been worth more than about $0.0125 - that one and a quarter cents. This isn't a horrible error, as it doesn't alter the context of what he's saying at that point in the text, but it does trigger a credibility warning flag.
A much bigger error, especially coming from someone claiming expertise in options, comes when he talks about price change distributions - an important element in volatility measurement and option pricing. He makes the statement "These values fit a bell-shaped curve where the peak represents a small number of unusually large price changes." This is totally incorrect. The peak of a bell curve represents a very high frequency of small price changes.Read more ›
In 248 pages he gives the reader an itinerary of things to watch, become aware and understand before you think your opinion of the markets is correct.
Most of the content in this book is fairly common sense...the main point throughout the book is that the news affects stock prices. Its hard for me to believe that we need a 272 page book to tell us that.
There's some good stuff in this book but most felt like filler.
Most Recent Customer Reviews
Are stocks a reasonable tool for the average retail investor to be playing with? There are hints that the market is against us and may even be rigged. Read morePublished on August 14, 2011 by Michael L. Loren
This book has a lot of information and is full of trading jargon, real-time examples from stock market, and many many charts. Read morePublished on July 18, 2011 by Kanishk Rastogi
The first half of the book was great -- the author clearly has thought about many of the issues plaguing modern-day finance, and his explanations for some of the inexplicable moves... Read morePublished on May 22, 2011 by Narada
I was getting ready to post a review of this book when I spotted a review in Seeking Alpha that I think sums it up:
"Trading Realities provides a foundation, and... Read more
This is a good book in the exercise of retrospective review. This seems to be the premise of this particular text. Read morePublished on April 22, 2011 by Eagle Vision
I have read many books on all kinds of trading and investing topics and this is simply one of the best, most insightful books I have read on the forces at work driving the markets... Read morePublished on April 22, 2011 by John Anthony
this book is a joke....how you have made money from any market is beyond me....if you have then reimburse me for this purchase because your book is an absolute waste of timePublished on April 15, 2011 by Danny
The author creates the main point to trade with the market. In foreign currency trading this is going with the trend. Read morePublished on March 24, 2011 by S. J. Northrip
This book gives a very helpful overview of the market place. The author, Jeff Augen, points out the pitfalls and realities a trader is faced with. Read morePublished on January 26, 2011 by Sandra J.