Trading for a Living and Other Books by Alexander Elder
Trader's Library #30 · Trading methods and craft. A complete trader's handbook: mind, method and money in one.
Author: Alexander Elder · Original: Trading for a Living; The New Trading for a Living; Come Into My Trading Room; Sell and Sell Short · Year: 1993 · Usefulness for traders: ★★★★★
What it's about
Psychiatrist and trader Alexander Elder describes trading in three dimensions: mind (psychology), method (analysis and system) and money (risk management). I cover both editions of “Trading for a Living” (the classic and “The New Trading for a Living” from 2014), “Come Into My Trading Room” and “Sell and Sell Short” on exits and short selling.
What it gives a trader
One of the best complete handbooks. Elder compares struggling traders to alcoholics who have to admit they have a problem, teaches keeping a journal with trade grades, introduces the Triple Screen system and rules for limiting losses per trade and per month. “Sell and Sell Short” fills a gap few people write about: when and how to get out.
Lessons for traders
- success rests on three pillars: psychology, method and money management
- a journal that grades every trade is the best teacher
- the exit is as important as the entry
- you need a predefined loss limit that stops your trading during a bad stretch
What to watch out for
The indicators and examples come mainly from the stock market and longer timeframes. “The New Trading for a Living” is more up to date than the old edition.
Discussion
The discussion takes place in Hetman Capital Club (in Polish). Join the discussion in the Club →
Navigation
← #029 The Psychology of Risk (Ari Kiev) · Library index · #031 Trader Vic I and II (Victor Sperandeo) →
Educational content, not investment advice. The book description is my own summary and assessment, not quotations. Edition details were checked in catalogues and bookshops, and where there was doubt I said so plainly.