Jesse Livermore – великий trader начала 20 century. One of the earliest trend traders. Among traders and investors Jesse Livermore was known by the nicknames "Young Grip" (Boy Plunger) and "Miracle baby" (Wonder Boy). He became famous for winning and losing millions of fortunes during the stock market crises. 1907 And 1929 years.
Jesse Livermore was born in Massachusetts, in a family of farmers, and left home at fifteen, to later become a great trader (according to legend stagecoach, where he left, stopped near a brokerage office, defining the profession of a young man). His mother supported him, unwilling son, per year completed a three-year mathematics course, farmer's fate, father was against. At his first job in Boston, Jesse Livermore wrote quotes on the board at the brokerage office of Payne Webber.
He wrote down his thoughts on future price movements., and then tested them. On the advice of a friend, Jesse Livermore took a chance to bid for the first time. Вложив 5 Dollars, he received 3,12 доллара прибыли. Having earned a considerable sum for those times in 1000 Dollars, Jesse Livermore started playing in clandestine OTC offices. Participants placed bets against the house, and most of them lost due to the instability of quotes. Livermore, against, won regularly and was soon expelled from this community. Then he sent his stops to the exchange and developed a system of rules, позволявших получать прибыль. Jesse Livermore is listed on the New York Stock Exchange (NYSE). Actually, in his entire life, he has never been to the NYSE marketplace., no other exchange of those, with whom he had the chance to work – conducting all your operations through brokers. In the 1920s, he had the most luxurious office in all of New York.: Jesse Livermore built his own trading floor, where on a huge board six clerks wrote out quotes for him alone – the great trader preferred to work in complete silence. Luxury country residences, giant yachts, numerous Rolls-Royces, драгоценности для жён и любовниц, drove the audience crazy – he lived on a grand scale and paid for mistakes accordingly.. IN 1907 year he earned 3 million dollar market crash, and in 1929 - whole 100. As a result, Jesse Livermore lost all this money. Based on your successful experience in debt securities trading, Livermore abandoned practical philosophy, the main principles of which are to increase the position, as long as it is in line with the trend and close it quickly to reduce losses.
Ironically, the great trader himself did not follow this system, because of what he lost his earned fortune. Jesse Livermore is now considered by many to be the greatest trader in history..
Many episodes from his professional activity were included in the popular book by Edwin Lefebvre "Memoirs of a Stock Market Speculator" (”Reminiscences of a Stock Operator” Edwin Lefevre). Lefebvre wrote Memories based on one lengthy interview with Jesse Livermore, but in fact, few people doubt, that most of it Books написал сам великий трейдер – too subtle and accurate details of this fascinating story, a fictionalized middle-aged stock speculator. The story is told from the perspective of the fictional character Larry Livingston. Besides, Jesse Livermore wrote the lesser-known book How to Trade Stocks. The formula for combining price and time of Livermore ". The first edition was published in 1940, and in the same year Jesse Livermore committed suicide. He shot himself with a .32 Colt. An eight-page suicide letter was found by the police in his notebook. Among the reasons for his death are years of depression and self-doubt after failures..
Need to say, that Jesse Livermore's personal life was not very successful. The first wife of the financier was a certain Nettie Jordan, with whom he divorced in 1918 year. IN 40 years old he married the beautiful Dorothy - an actress from Siegfield Folly. She filed for divorce and moved to her hometown with her lover. IN 1932 the divorce took place, and Dorothy got custody of her sons. A year later, Livermore married 38-year-old Harriet Metz Noble. This was her fifth marriage, and the young people refused to go on a honeymoon.. Harriet's four former husbands committed suicide. It became a bad omen. An unpleasant episode occurred in 35 year, when Jesse Livermore's ex-wife Dorothy shot their son during a drunken quarrel, Jesse Jr.. He survived, however, the scandal was inevitable.
Below are selected excerpts from Lefebvre's book:
“Another lesson, which I learned earlier, заключался в том, that there is nothing new on Wall Street. Nothing new can be, because speculation is old, how is the world. Whatever happens in the markets now, it has already happened and it will happen again.
I have had 10 one thousand dollars, when I was 20 years and my margin on that sugar trade was higher 10 thousand. But I didn't always win. My trading plan was good enough and won more often, what did you lose. If I used it all the time, i would win 7 times out 10. Usually, i have always made money, when I was sure, that i am right, before bidding. I was wrong about, that I didn't have enough brains to constantly stick to my plan and play in the market, only when previous events spoke of successful trading. Each event has its own time, but i didn't know that. This is what caused the collapse of so many people on Wall Street., who weren't suckers at all. There is a simple fool, which is all, always and everywhere does it wrong, and a fool from Wall Street, который думает, that I have to trade all the time. No one can have adequate reasons to buy or sell stocks for the day or have enough knowledge, to play the market intellectually.
It takes a lot of time, to realize your mistakes. They say, that there are two sides to everything, but the market has only one side. And it's not bullish, or bearish side, but the true side. The market is always right.
Nothing teaches you that., what not to do, as the loss of everything, what you have. And when you understand, what you can not do or lose money, you start learning, what to do, to win. It is to learn.
I think, a serious step in my education was the moment, когда я осознал в конце концов, that old Mr.Partridge kept repeating to his clients: «Хорошо, ты знаешь, this is a bull market ", he really meant, that big money is not in individual fluctuations, but in a single movement, it means, what you need to watch out for prices, and behind the market. The reason is, what a person can see clearly, what the market does that, what, as planned, he has to do and yet this person becomes impatient and hesitant. This is why so many Wall Street men have lost money., and they weren't school suckers. They didn't lose to the market, they lost to themselves, despite their mind, they could not fulfill their plans. The old Turk was damn right, when he spoke, What do we have to do. But he could not remain patient and confident in his actions.. The average person is not interested in bull or bear markets, he wants, to be told which stock to buy or sell. He wants to get something, giving nothing. He doesn't want to work, he doesn't even want to think. It's so boring, when to count money, who just found. To talk about my first million dollar mistake, need to go back to that time, when i first became a millionaire. It was right after the October collapse 1907 of the year. Since my trade continued, a million meant only additional reserves for me. Money does not give a trader a sense of comfort, because he is rich or poor, he can be wrong and it is always uncomfortable to be wrong. And when the millionaire is right, money is just his servants. I don't care about losing money. Loss never upsets me; after i accepted it, I forget about him the next day. But don't follow your own plan, do not accept loss, как рассчитывал, this is really damaging my soul and my pocket.
That, what will i tell you, this is the basis of my trading plan, which is based on the study of price movements. It is enough for me to know about the possible direction of further price movement. I do additional tests just to calm myself.. I usually look for prices for this., after i started.
There are few worse mistakes for speculators, than averaging losses. My cotton deal totally proved it. Always sell losing stocks and always keep winning ones. It's so obvious, that I always wondered at myself, when I did everything exactly the opposite.
Losses don't bother me. When i lose money, i am considering it, как плату за education. A person must study and must pay tuition fees. During boom times, when there is a large number of people on the market, no need to show any discernment, there is no point in, to waste time discussing, what happens during such booms. It's like trying to tell the difference between raindrops falling on a nearby roof.. Sucker always tries to get something without paying, the message of all these booms is always to the player's instinct, the basis of which is greed and improving well-being. People, looking for easy money, always pay for the privilege of getting proof, that they are not on this wretched and greedy land. At the beginning, when i listened to stories about old deals, I thought, that people are less gullible now. But now, reading in the newspapers about pyramids and stealing brokers, I'm sure, what millions of dollars, suckers, will still join the silent mass of lost savings.
There are always people, who walk faster, than the rest of the crowd. They are destined to lead the rest., it doesn't matter how much this crowd has changed. ".
Books about Jesse Livermore:
* Reminiscences of a Stock Operator by Edwin Lefèvre (best selling biography of Livermore, reprinted many times, latest edition in 1994 year) ISBN0-471-05970-6
* Jesse Livermore – Speculator King, Paul Sarnoff , ISBN 0-934380-10-4
* Jesse Livermore: The World’s Greatest Stock Trader, Richard Smitten, ISBN 0-471-02326-4
* How To Trade In Stocks, Jesse Livermore, ISBN 0-934380-75-9 (first edition in 1940)
* Trade Like Jesse Livermore, Richard Smitten, ISBN 0-471-65585-6
* Lessons from the Greatest Stock Traders of All Time, John Boik
* How Legendary Traders Made Millions, John Boik
