Summary of Jack D. Schwager's Market Wizards

By IRB Media

Get the Summary of Jack D. Schwager's Market Wizards in 20 minutes. Please note: This is a summary & not the original book. Original book introduction: How do the world's most successful traders amass tens, hundreds of millions of dollars a year? Are they masters of an occult knowledge, lucky winners in a random market lottery, natural-born virtuosi—Mozarts of the markets? In search of an answer, bestselling author Jack D. Schwager interviewed dozens of top traders across most financial markets. While their responses differed in the details, all of them could be boiled down to the same essential formula: solid methodology + proper mental attitude = trading success. In Market Wizards Schwager lets you hear, in their own words, what those super-traders had to say about their unprecedented successes, and he distils their responses down into a set of guiding principles you can use to become a trading star in your own right.

• Language: English
• Publisher: IRB Media
• Release date: Dec 13, 2021
• ISBN: 9781669344711

IRB Media

With IRB books, you can get the key takeaways and analysis of a book in 15 minutes. We read every chapter, identify the key takeaways and analyze them for your convenience.

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Insights on Jack D. Schwager's The New Market Wizards

Contents

Insights from Chapter 1

Insights from Chapter 2

Insights from Chapter 3

Insights from Chapter 4

Insights from Chapter 5

Insights from Chapter 6

Insights from Chapter 7

Insights from Chapter 8

Insights from Chapter 1

#1

The author didn’t want to trade until he felt he had enough capital to risk, and he needed time to rest after working on his book.

#2

One day, Schwager was reviewing his charts and felt that the British pound was about to collapse. In reality, the market just went sideways for a few days before returning to its pre-crash prices.

#3

Following the advice of a friend, the author sold the British pound, which had been rising steadily, and had reached its highest level in over a year.

#4

Following someone else's trade can be dangerous, as it can lead you to disregard market clues that could have alerted you to a potential market top.

#5

The author was eager to speak to Ed, who he hoped would be his mentor for the weekend. He told Ed about his recent trading experiences, explaining how he started trading again despite being apprehensive. He also told him that he had nearly $20,000 in the account before he put on the British pound trade.

#6

The author once traded for $100,000 in two years, but was unable to make a profit because he always felt like he was missing out on something. He eventually quit trading because it felt wrong to him.

#7

Saddam Hussein initially invaded Kuwait to take control of its oil fields. However, the United States responded by sending troops to defend Saudi Arabia, and the UN passed several resolutions against Hussein, which he ignored.

#8

If you can't handle a small loss, you will eventually have to handle the mother of all losses.

Insights from Chapter 2

#1

The world’s largest financial market is not stocks or bonds, but currency trading. It is estimated that $1 trillion is traded each day in the currency markets.

#2

Lipschutz was unable to provide any anecdotes during his first interview, but as the author continued to press him for more details, he started to open up.

#3

The author met with Lipschutz, who was obsessed with the markets and trading. He appeared very relaxed, despite watching the markets all the time.

#4

While enrolled in the architectural program at Cornell, the author inherited a stock portfolio worth $12,000, which he liquidated for great cost because all the stocks were odd lots. He used the money to start a trading account.

#5

The author spent a lot of time in the library reading annual reports and financial magazines such as The Economist, Barron's, and Value Line. He also began to watch the stock tape on cable, which gave him a feel for price action.

#6

When the author began working at Salomon Brothers, he was initially supposed to work for both Dr. Kaufman and Mr. Sidney, but he ended up working for just Sidney.

#7

The author worked at Salomon Brothers during the late 1970s. The company used to trade in equity options, which at the time were not quantified.

#8

In the late 1980s, the culture of Salomon Brothers changed for the worse. The trainings became too large, and the trainees seemed to come from the same mold, which resulted in a weaker culture.

#9

John Gutfreund was the chairman of Salomon Brothers, one of the most influential investment banks during that time period.

#10

The author worked for a brokerage firm, and during his time there, he learned that the best way to get things done was to simply ask for them. People were generally flattered by this, and it led to him getting his way more often than not.

#11

The author was a bond trader at Salomon Brothers in the early 1980s. One day, the head of foreign exchange came up with the idea to start a foreign exchange department. He asked the head of the bond trading division if he could run it. The latter agreed.

#12

One of the traders had us going out to dinner with international bankers three or four times a week. It was during this time that Schwager, the shy and reserved newbie, was invited to call Morgan Guaranty to place a D-mark transaction.

#13

The author was the only person in the Salomon Brothers foreign exchange department who knew anything about currency trading. One day, he was asked to create a new department.

#14

Foreign exchange is all about relationships. If you have good liquidity, you can find it by being plugged into the information flow. It all depends on relationships.

#15

The author was a new employee at a foreign exchange trading