Book of the Month: Market Wizards by Jack D. Schwager

Book of the Month: Market Wizards by Jack D. Schwager

Book of the Month: Market Wizards by Jack D. Schwager

Reviewing the interviews with some of the most prominent traders in history

Our pick for October is a classic among readers interested in the traders, specifically in those that have managed to master them for long periods of time. The interviews in the book were taken in the late 80s and come on the back of the market crash of 87’, but its relevance has largely stood the test of time. Some of the prominent names from then still actively trade to this day and are definitely among the masters in the trading craft.

The book itself has five sections containing interviews with traders grouped around what and how they trade. Schwager provides context with intro texts and summations before and after each of the interviews, which help in identifying the most important parts of the interviews and interpreting the information you can glean from them.

The first section is dedicated to futures and currencies and includes talks with Michael Marcus, famous for multiplying his company’s assets over 2,000 times in the space of ten years. He provides one of the most notable quotes in the book – “Every trader has strengths and weaknesses…As long as you stick to your own style, you get the good and bad in your own approach. When you try to incorporate someone else’s style, you often wind up with the worst of both styles. I’ve done that a lot.”

“A Little Bit of Everything,” has interviews with Mark Weinstein and George Soros’ co-founder in the Quantum Fund – Jim Rogers. He is still seen as a household name and is featured frequently on financial news channels for his lasting insight on commodities and China.

Specifics of how all these traders managed to win in the markets are interesting in themselves, but can seem outdated or a bit too complex to some (the appendix is quite handy). Having this in mind, the book’s significance in the modern context is that it reveals what’s common and different in the approach of successful traders. Their personalities differ, as well as the details of how and where they made profits. There are however some prevailing themes like accepting losses in your stride, discipline in the face of adversity, seeing yourself as a work in progress and that its about riding the wave, not controlling the weather.

Some recent readers have voiced opinions that the book is irrelevant in the new trading age. While it’s a fact that so much has changed over the course of approximately 25 years – the advent of the euro, hyper connectivity and speed of execution, access for small investors among many others – the book can show what doesn’t change in trading practices which is the human element at the center of it all.

You can win the book by leaving a comment with other reads you’d like us to review, or general suggestions for the blog. One of you will receive “Market Wizards” as a gift from us for your feedback. We will contact the winner over email with details before the 24th of October, 2014.

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