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Think and Trade like Jesse Livermore: How to beat the Market by “Sitting Tight”

The must-read for finance and investing enthusiasts: “Reminiscences of a Stock Operator” by Edwin Lefèvre. This classic book has captured the imaginations of readers for decades, and it’s still as relevant today as ever. Learn from the experiences of one of the most successful traders of all time, and discover the secrets to making smart investment decisions.

Quote 1: “It never was my thinking that made the big money for me. It always was my sitting.” – Jesse Livermore

Our first quote comes from the early pages of the book, where Larry Livingston, the protagonist, reflects on the importance of patience. He recognizes that his greatest successes did not come from constant trading or impulsive decision-making but from the ability to sit back and wait for the right opportunity. In the fast-paced world of stock trading, this is a valuable lesson to remember. Sometimes, the best thing we can do is patiently observe and wait for the right moment to strike.

Quote 2: “The market does not beat them. They beat themselves.” – Jesse Livermore

Here, Jesse Livermore reminds us that the market itself is not responsible for our successes or failures. It’s our own actions and decisions that determine our fate. This quote emphasizes personal responsibility and the importance of self-reflection. Successful traders understand that they must take full accountability for their choices and learn from their mistakes. Blaming external factors only serves as a distraction from personal growth and improvement.

Quote 3: “There is nothing new in Wall Street. There can’t be because speculation is as old as the hills.” – Jesse Livermore

This quote is a reminder that despite the ever-changing landscape of the financial world, the underlying principles of speculation remain constant. While new technologies and financial instruments may emerge, human psychology and market dynamics tend to repeat themselves over time. By studying the past and understanding the patterns of the market, we can gain valuable insights into the present and make more informed decisions.

Quote 4: “The speculator’s chief enemies are always boring from within.” – Jesse Livermore

Quote 5: “When I am wrong, it’s never by much, and when I’m right, I’m usually a little more right than I thought I would be.” – Jesse Livermore

This quote highlights the importance of risk management and having realistic expectations. It’s crucial to have a clear understanding of one’s limitations and to avoid excessive risk-taking. Being consistently right may be challenging, but by managing risk effectively, traders can achieve more significant gains while minimizing potential losses.