Any good books on share trading?

[Ergophobia]

I want to start investing in the australian stock market, and have been reading lots on-line and watching a few shares, paper trading in excel.

Can anyone here reccomend a good book to get started on?

 

[Terry_w]

I want to start investing in the australian stock market, and have been reading lots on-line and watching a few shares, paper trading in excel.

Can anyone here reccomend a good book to get started on?

I've found Colin Nicholson's books good. "Building Wealth in the Stock Market" - more long term investing though.

 

[Aaron_C]

You just have to find companies that you understand and can make comfortable projections on how they are going to perform in the future. I don't think any book will really help you per se, since stock analysts who are meant to be experts always get it wrong.

For example, if you think retail at the moment is on a downward slide and won't recover for at least the next 2-3 years, then that's the sector you avoid. But if you think that recovery is imminent and profit growth is coming up shortly, then you may choose to purchase the shares instead. Then you select which companies in that sector are best and make a decision from there. It's really as simple as that.

 

[Aaron Sice]

Elder's Trading for Living.

will make you feel about >< this big.

 

[Murphy69]

I want to start investing in the australian stock market, and have been reading lots on-line and watching a few shares, paper trading in excel.

Can anyone here reccomend a good book to get started on?

First, do you want to invest or trade? Its worth being clear on the distinction. Both methodologies work, but have different time frames,objectives, risks, personality types that they are suited to etc.

This will help guide what books are suitable. Don't be fooled into starting off trades and then turn them into investments if the trade doesn't work out.

As to paper trading, my field is Simulation, and what you aer feectively doing is a simulation, so I feel comfortable giving you advice here.

Don't paper trade as a beginner. Paradoxically, paper trading is better suited to professionals.

The reason for this is you do not have enough experience to understand the distinctions between real trading and paper trading.

At the high cognitive end, much of trading relies on emotional/psychological aspects. None of this is replicated in paper trading.

At the lower cognitive end, a lot of trading is about the mechanics, order placement, order management, managing mistrades, slippage, bad fills using your chosen platform. Again paper trading doesn't replicate this (particularly if using an excel spreadsheet, but even using a providers platform in simulation mode doesn't provide this well).

So, the main use for paper trading or simulated trading is in the development, testing, verification, validation and assurance of trading systems. This is where simulated trading is most useful. But this is the domain of someone who has mastered the psychology and practical aspects of trading.

So, by all means play around a bit with excel or a charting package, but make sure you understand the above.

Whilst finding a 'guru' can be very risky, there are reputable advisers out there who can provide the 'methodology' while you are learning the 'psychology' giving you a good stepping stone to developing your own methodology.

Cheers
Murphy

 

[willair]

I want to start investing in the australian stock market, and have been reading lots on-line and watching a few shares, paper trading in excel.

Can anyone here reccomend a good book to get started on?

The only question to ask is why now?,Oil is just starting to crank up again in price,and Gold is not going the way everyone thought it would,paper trading will only take you so far,i target Banks ..

Start with this Man,he'S Australian,upfront,and haS a lifetime of experience ..

http://nickrenton.com/

 

[Ergophobia]

thanks for the suggestions... ill go up to boffins book shop at lunch and see if I can find any of them.

looking back at the mess that was the GFC, I dont want to buy and hold and am planning on actively trading.

Id also like to get set up for trading so that if another crash hits I can grab some bargains.

By paper trading I mean narrowing in on some stocks, setting my buy point, stop loss and sell point, capital invested, LVR, then monitoring the stock to see if I would have made a proffit or loss.

An example is Stock X where I set my buy at $4, $2000 capital , $2000 margin loan, stop loss at 3.80 (5%) sell point at 4.40 (10%), its at 4.30 now so its looking good and im thinking I should raise my stoploss to break even.

But id like to learn more on fundamental analysis and hedging as there is still heaps I dont know.

 

[Aaron Sice]

futures is a great game to play, even for paper trading.

get good on paper then start playing with $1000 at a time.

 

[slammindan]

My two favourite trading books are Nicolas Darvas - How I made 2M in the Stock Market and Jesse Livermore - Reminiscences of a Stock Operator

Both books are classics & still stack up, as markets never change.

I'd suggest starting small on equities to prove your ideas/trading plan. If you can't succeed there it's very unlikely you will succeed on any other instrument.

 

[Ergophobia]

So I just walked out of boffins with a shiny new copy of Share Investing for Dummies

After flicking through a few other books I quickly realized that I need to completely cover the basics.

Keep the suggestions coming tho, ill add them to my required reading list

 

[nkirlew]

Daryl Guppy

A Territory author Daryl Guppy the book is titled Share Trading an approach to buying and selling, now in tenth edition.

 

[LukeLang]

Here is a list of top notch trading books, i have read most and it is a really great compilation of the best of best trading books.

-Beyond Candlesticks: New Japanese Charting Techniques Revealed – by Steve Nison.
-Candlestick Charting Explained – by Gregory Morris
-Come Into My Trading Room: A Complete Guide to Trading – by Alexander Elder
-Encyclopedia of Chart Patterns – by Thomas N. Bulkowski
-Entries & Exits: Visits to 16 Trading Rooms – by Alexander Elder
-High Probability trading – by Marcel Link
-High Probability Trading Strategies: Entry to Exit Tactics for the Forex, Futures, and Stock Markets – by Robert C. Miner
-How I Made $2,000,000 In The Stock Market – by Nicolas Darvas
-Market Wizards: Interviews with Top Traders – by Jack D. Schwager
-Mastering the Trade – by John F. Carter
-Reminiscences of a Stock Operator – by Edwin Lefèvre
-Sell and Sell Short – by Alexander Elder
-Study Guide for Trading for a Living: Psychology, Trading Tactics, Money Management – by Alexander Elder
-Technical Analysis of Stock Trends – by Robert D. Edwards
-Technical Analysis: The Complete Resource for Financial Market Technicians – by Charles D. Kirkpatrick, Julie R. Dahlquist
-The Candlestick Course – by Steve Nison
-The Complete Guide to Day Trading: A Practical Manual From a Professional Day Trading Coach – by Markus Heitkoetter
-The Complete TurtleTrader: The Legend, the Lessons, the Results – by Michael W. Covel
-The Encyclopedia of Trading Strategies – by Jeffrey Owen Katz , Donna L. McCormick
-The Master Swing Trader: Tools and Techniques to Profit from
-Outstanding Short-Term Trading Opportunities – by Alan S. Farley
-The New Market Wizards: Conversations with America’s Top Traders – by Jack D. Schwager
-Trade Your Way to Financial Freedom – by Van Tharp
-Trading Classic Chart Patterns – by Thomas Bulkowski
-Trading for a Living: Psychology, Trading Tactics, Money Management – by Alexander Elder
-Trading in the Zone: Master the Market with Confidence, Discipline and a -Winning Attitude – by Mark Douglas
-Trend Trading for a Living: Learn the Skills and Gain the Confidence to -Maximize Your Profits – by Thomas K. Carr
-Way of the Turtle: The Secret Methods that Turned Ordinary People into -Legendary Traders: – by Curtis Faith

List is from the everyday trader website, they also offer a very good trading course which i have done and highly recommend. It offers a very good rounded understanding of trading do's and dont's and how to trade successfully.

 

[redwing]

Adaptive Analysis by Nick Radge?

I also have several books by Allan Hull, Louise Bedford, Darry Guppy, Martin Roths Top Stocks, The Little Book of Investing Series, Marcus Padleys book, Scott Pape's book and more recently a couple on the Kindle such as:

• How a Second Grader Beats Wall Street

Any many, many PDF's stored away for retirement reading

 

[Andrew_A]

My two favourite trading books are Nicolas Darvas - How I made 2M in the Stock Market and Jesse Livermore - Reminiscences of a Stock Operator

Both books are classics & still stack up, as markets never change.

Have to add '50 Years in Wall Street' by Henry Clews if you enjoyed those two.

 

[willair]

http://www.fooledbyrandomness.com/

The Black Swan is also something that will help just takes a bit to get into that mindset..

 

[Mr. Fabulous]

http://www.fooledbyrandomness.com/

Top notch suggestion.

The Black Swan is also something that will help just takes a bit to get into that mindset..

Didn't like The Black Swan, but that's just me.

 

[Ocean Architect]

I would suggest reading and subscribing to "The Trends Journal" by Gerald Celente

 

[Andrew_A]

Top notch suggestion.



Didn't like The Black Swan, but that's just me.

Agreed, Fooled is the number 1 suggestion I would make, Black Swan just lost me. Taleb is a blowhard but 'Fooled' just nails my belief of the reality of financial markets, best advice I never took though and like most people needed to make the same mistakes others made to believe them.

 

[Graemsay]

On the "Fooled by Randomness" theme, you might also take a look at "A Random Walk Down Wall Street" by Burton Malkiel.

I haven't read either, but my understanding is that they both posit the thesis that market behaviour is random, and if you beat the market then it's entirely down to chance.

If Taleb and Malkiel are correct then trading is going to be a waste of time and (possibly) money. The chances of beating the market are relatively low (I've heard 20% short term, 5% long term). A better strategy might be to buy a cheap tracker fund (yes, I've advocated this before ), park your money there, and forget about it.

Beyond that, I've heard that studies have shown that buy and hold (i.e. an investment strategy) gives better returns than trading frequently.

An alternative strategy to look into is a High Yield Portfolio. They've performed well in recent years.

 

[Andrew_A]

I haven't read either, but my understanding is that they both posit the thesis that market behaviour is random, and if you beat the market then it's entirely down to chance.

This isn't Taleb's point at all, he's very much against markets pricing risk correctly, especially rare events, separating luck from skill is more the gist.