27 Quotes by Alexander Elder

Being simply “better than average” is not good enough. You have to be head and shoulders above the crowd to win a minus-sum game.

The mental baggage from childhood can prevent you from succeeding in the markets. You have to identify your weaknesses and work to change. Keep a trading diary – write down your reasons for entering and exiting every trade. Look for repetitive patterns of success and failure.

Use limit orders almost exclusively – except when placing stops. Be careful on what tools you spend money: there are no magic solutions. Success cannot be bought, only earned.

People trade for many reasons – some rational and many irrational. Trading offers an opportunity to make a lot of money in a hurry. Money symbolizes freedom to many people, even though they often don’t know what to do with it.

The public wants gurus, and new gurus will come. As an intelligent trader, you must realize that in the long run, no guru is going to make you rich. You have to work on that yourself.

Markets need a fresh supply of losers just as builders of the ancient pyramids needed a fresh supply of slaves. Losers bring money into the markets, which is necessary for the prosperity of the trading industry.

The answer is to draw a line between a businessman’s risk and a loss. As traders, we always take businessman’s risks, but we may never take a loss greater than this predetermined risk.

There are good trading systems out there, but they have to be monitored and adjusted using individual judgment. You have to stay on the ball – you cannot abdicate responsibility for your success to a mechanical system.

So far, the only people who’ve made money from trading systems are their sellers.