Reminiscences of a Stock Operator
This book is a favorite among traders. It recounts the life and times of renowned speculator Jesse Livermore (1877-1940). Told in the first person by a fictional character named Larry Livingston (Livermore), the story describes one trader’s rise from amateur to professional. Though written as a historical novel, the vast majority of people and events in the book are real. Here, annotator Jon D. Markman enlightens us with photos, information, and commentary that provide a meaningful context for understanding Livermore’s journey.
Perhaps the most interesting aspect of the book is that it shows how Livermore evolved as a trader through careful observation of markets and detailed evaluation of his trading behavior. While participating in both stock and commodity markets, he developed a stable set of trading procedures that shaped his career and may be employed in modern markets.
Livermore made and lost several million-dollar fortunes. Losses occurred because he did not follow his own trading plan at times and adjust to regulatory changes that occurred after the 1929 stock market crash.
Overall, the book emphasizes the point that there is nothing new on Wall Street. Speculation has occurred since ancient times and human beings tend to react to market forces in similar ways regardless of time period. Learning to read the tape is of prime importance because ignorance, fear, greed, and hope are ever-present dangers in trading.