Hello EdgeHunter,
Correct, that part is not important at all. The only thing important is a he made +$1 million from trading the market.
The market is a game of lions and buffalo.
Run fast or get eaten.
Jesse Livermore Trading History Highlights... Excellent Vid...
- Thread starter EdgeHunter
- Start date
Correct, that part is not important at all. The only thing important is a he made +$1 million from trading the market.
The market is a game of lions and buffalo.
Run fast or get eaten.
I first read Market Wizards and Reminiscences of a stock operator about the same time around 25 years ago.
The thing that struck me was the modern Market Wizards would strongly emphasise cutting position size during losing streak. Where as Jesse Livermore never really mentions this.
Livermore does mention cutting losses if wrong and building up a position in increments. But no mention of getting smaller when losing.
So i think Livermore would not cut his size down if he lost 25% of his account, then 50% of his account, then 75% of his account etc. He probably continued to swing the same large line (same number of shares/contracts) and so more easily blow up..
So it sounded to me like Position Sizing mistakes rather than Risk management (not cutting loses) might have been his downfall. Although the two things are inter related in many ways.
Im sure he was susceptible to running losses sometimes and doubling down on losers during his career. Although from his books it was obvious that he knew those things were major mistakes.
The thing that struck me was the modern Market Wizards would strongly emphasise cutting position size during losing streak. Where as Jesse Livermore never really mentions this.
Livermore does mention cutting losses if wrong and building up a position in increments. But no mention of getting smaller when losing.
So i think Livermore would not cut his size down if he lost 25% of his account, then 50% of his account, then 75% of his account etc. He probably continued to swing the same large line (same number of shares/contracts) and so more easily blow up..
So it sounded to me like Position Sizing mistakes rather than Risk management (not cutting loses) might have been his downfall. Although the two things are inter related in many ways.
Im sure he was susceptible to running losses sometimes and doubling down on losers during his career. Although from his books it was obvious that he knew those things were major mistakes.
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Ok... LOL... Then it should really FIRE UP your engines with the fact that his SHORTING of the 1929 CRASH (starting in summer of 1929) made him 1 Billion in today's dollar value... a wee bit more than 1 Mill...
Exact meaning?
When he killed himself over his failures and trading loses rather than let his life play out and see what else he could accomplish while he was still alive.
Thanks.
My immediate interpretation was he was stopped out of his positions by a margin call, he couldn't meet. His reputation was no longer there and he couldn't raise money for a comeback.
It has been speculated that he was bipolar. That coupled with his tumultuous trading career and the fact that his third wife's four previous husbands all committed suicide should not detract from the lessons one can learn from him.
Good summary of the books the speaker said he based his presentation on. Although I didn't read Sarnoff's biography of Livermore, I read the other two, as well as the annotated version of Reminiscences, which is much longer and has added context, included the real names behind the pseudonyms in the original Reminiscences. I suspect the speaker may also have referred to the annotated text for his info.
I did not know that existed. If there is a link to that or vid of that please add it... thanks...
You really looked into Livermore extensively... Others ?
By "others" if you mean during that period, I also read about Arthur Cutten, who was sometimes on the other side of Livermore's trades, which made it interesting for me. He also made a fortune, but the Stephens' biography of Cutten was rather dry, and not even close to the Livermore biographies or Reminiscences.
https://www.amazon.com/s?k=to+make+a+killing+arthur+cutten&crid=3N4Q7GI706T74&sprefix=arthur+cutten,aps,100&ref=nb_sb_ss_ts-doa-p_2_13
Also of that period there was Bernard Baruch's memoir "My Own Story" which I recall to have been a good read, although I read it quite a few years ago. I should have a look at it again.
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