Trading the markets can be daunting and intimidating, but also exciting and captivating.
But how is it for the all-time greats? Let’s stop for a moment and check out 5 trading quotes that made history.
1. "The stock market is filled with individuals who know the price of everything, but the value of nothing." - Phillip Arthur Fisher
Best known for his famous book "Common stocks and uncommon profits," Philip Fisher was a highly successful investor. He led a quiet life outside the media’s attention. According to wikipedia.com, his most famous investment was the purchase of Motorola back in 1955.
This quote of him stresses that without proper education and time invested researching the markets, people would be better off not investing in stocks at all. Caution, planning ahead, and developing the right approaches for specific trading scenarios will do.
2. It's not whether you're right or wrong; it's how much money you make when you're right and how much you lose when you're wrong – George Soros.
The Hungarian-American billionaire worldwide celebrity is widely recognized as the man who broke the Bank of England in 1992.
With this, Soros wanted to highlight a simple trading fact: you shouldn't care too much how many times you make wrong trades and how many times you are right. What matters is the amount of money you get when you're successful and the amount of money you lose when the markets move against you. Everything in between is secondary.
3. Learn to take losses. The most crucial thing in making money is not letting your losses get out of hand." – Marty Schwartz
Marty Schwartz is a Wall Street trader who became famous when he won the U.S Investing Championship in the mid-1980s.
His quote remains in the history books as it touches one fundamental trading constant: losses are part of the game. You cannot always avoid them. What you can do instead is learn how to protect your investments by properly using risk management tools. Generally, it’s the ignorance of risks that leads traders to their doom.
4. “Do more of what works and less of what doesn’t” - Steve Clark.
The least known trader in our list, Steve Clark, had a chapter in Jack Schwager's book "Hedge Fund Market Wizards." The name of the chapter? "Do more of what works and less of what doesn't."
What does the author want to signal? I think he intends to say that the only way to know what works and what doesn’t is to record your previous trades.
Tracking both your successes and failures alike is something experts teach us to do. It should also be a part of your trading plan.
5. 'The light can go from green to red without pausing at yellow' – Warren Buffett.
Who hasn't heard of Warren Buffett? His reputation precedes him. With a net worth of $71.8 billion (as of July 2020), he is the fourth wealthiest man globally.
An author of numerous legendary quotes, Buffett sent a letter to Berkshire Hathaway’s shareholders (his company). He highlighted the argument against borrowing money to buy stocks. Amongst the words he used are the ones from above. And it rings true: the markets can switch at 180 degrees very fast, and you don't want to catch you off-guard with a big hole in your pocket.
Do you know what my favorite trading-related quote of all time is? "Spend more time learning how the market works instead of reading trading quotes." Yes, I made this one up. But you could take it seriously. It’s more important to study and practice your trading skills than bombarding yourself with millions of trading quotes.
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