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 MARKET REPORTS |
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Trading books
Book Review: Trade Your Way to Financial Freedom
Will Kraa, December 19, 2007
With the holiday season almost here, now might be the time to suggest some beneficial reading matter for any spare time you might have soon. You might have noticed by now that I am not a great advocate of the very expensive seminars that are advertised and promoted so often. I think it is possible to get the same information from good books. I have been asked from time to time what books I would suggest so here are a few of the ones I have found very helpful.
Some will take some study and need to be read more than once to get the full benefit. The first book I want to recommend is not cheap but possibly if you are still looking to get a Christmas present for your partner, this might be suitable. I’m sure your partner (if you have one) will appreciate being able to read about the things you do as you trade (and of course you will also get the benefit.) Then, while you are on holidays it would be worthwhile to suggest that you read the book first seeing you have some spare time during the holidays and will be too busy trading once the holidays are finished.
Now I must tell you right now that I am not licensed to give relationship advice and before following my suggestion re using the present giving strategy outlined above, I would strongly urge that you get advice from a qualified relationship advisor. I will not be responsible for any possible adverse outcomes of the abovementioned strategy and you must ensure that the strategy is suitable for your risk tolerance.
My trouble is that I am having great difficulty getting this article finished. Every time I look at this book to tell you about its features I finish up reading on (even though I have read it before, more than once) and this is just taking too long to get done.
So maybe I should just say, get this book regardless unless you have it already. It is one you simply must read and study if you are serious about trading. The name of the book is “Trade Your Way to Financial Freedom” by Van K Tharp, second edition, McGraw-Hill, 2007. It has 479 pages, hard cover, and cost me $50.
It is a popular book so should not be hard to get hold of. I suspect that even though it is popular, most people don’t read it properly, or don’t put it into practice seeing most people make no money from trading.
I know that this book (in its first edition – I now have the second edition) transformed my trading years ago and I wished I had come across it earlier. I am convinced that the financial freedom I now enjoy is in large measure due to the fact that I read and studied this book. If there were only one book I could buy about trading, this one would be the one I would get.
While this book does contain ideas that need careful study, it is not overly technical and is written so that it is relatively easy to read. The book starts by outlining a simple way of making lots of money, a way of having an 80% chance of being right (the kind of pitch that might be used to get you into attending a seminar), and then goes on to show how you could go broke using it.
It then shows what is really important in being successful in the market and how you can go about doing what is necessary to achieve it. He mentions that even if you attended a seminar by a very successful trader, where he taught you his method of trading, it might prove to be no help at all and outlines why this is so.
True financial freedom is not something most people have, no matter how large their income, and it is not a concept that most people understand, but here it is defined in a very simple way.
The book deals with your own psychological attitudes, setting objectives, developing a system, selecting concepts that work, trading strategies, protecting capital, taking profits, evaluating your system, position sizing and many other things. It is all very practical and compulsory reading before you develop a trading system.
I could spend much more time telling you what is in this book and if I did that it might just take me the rest of the week to get this finished. So I won’t do that, as I would like to get this to you before the holidays. I’ll finish by saying just go and buy it - you won’t regret it.
There are other books I have found very worthwhile and I will tell you more about them later.
More articles from this edition of CompareShares:
Investing: How investors will be impacted by a Rudd Government
Stock picks: Fund manager stock picks: WPL, CCP & WWA
Stocks: Stocks and sectors set to beat the market in 2008
Book Review: Trade Your Way to Financial Freedom
Resident Trader: Handling a trade dispute with your broker
Markets: US breaks from booming global economy
Expert Panel: Why it may pay to buy shares before the ex-dividend date
Debt: Super won’t help mortgage woes
Rates: Rising costs add to rate risk
Whatever your views, you can discuss this article - or any of Will's articles - on our message board Your 2 Cents.
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