Market Wizards: Interviews with Top Traders

Introduction 💡

Market Wizards is a series of five books by Jack D. Schwager, that offers invaluable insights into the minds of successful traders. This review focuses on the first volume, published in 1989, exploring the psychology, strategies, and approaches of the top traders of the day. 💪

Key Themes 🤩

One common thread among these successful traders is their independent thinking. They rely on their instincts and of TA, rather than following news, advice, or popular trends. This aligns with the efficient market hypothesis, which suggests that all available information is already reflected in market prices nurturing any information asymmetry. Regardless of one's thoughts toward the market, the top traders created their strategies and tactics. Some even incorporate value investing when formulating their position. 🌪

The ultimate goal of trading is simple: to enter the market with a position and exit with more money than started with. While losses are inevitable, successful traders view them as learning opportunities and persevere through setbacks. All the traders in the book confess that they have lost money in the market - some jokingly call it the due tuition, but all of them did not give up, they came back and won it back. Just as a boxer gets punched and floored and gets back up, so do these traders. As Warren Buffett often notes, this resilience is more important than intelligence. 🫡

Paul Tudor Jones III: A Case Study

Paul Tudor Jones III, a prominent futures trader featured in Market Wizards, is known for his successful short position during the 1987 market crash. A documentary about him reveals his intense focus and determination. The video gets scrapped from the internet, but luckily, I found an upload of that video, and the link is below - check it out before it gets pulled down. This doc has a scene juxtaposing him with a trader on the floor sharing their thoughts about the market. Jones is present, focused, and compelled to come out as a champion. The other guy is looking for the exit. 😰

Conclusion 💅

Market Wizards provides a valuable resource for anyone interested in trading. By studying the mindsets of successful traders, readers can gain a deeper understanding of the market and improve their trading skills.

Contrast this to all the noise in CT and retail trading circles, it's humiliating and pitiful to see meme stock retail and meme coin degens refuse to accept the facts printed on the market and construct outrageous narratives like 'This time it's different' or 'This is the future'. Recently I heard one: 'This is a religion'. When compared to those in the book, to put it poetically, the winners seek the truth. 💯