The Traders Journal

Mr. Market Wizard: Jack Schwager Speaks Part II


YBMMH7H5President Harry Truman once said “We must have strong minds, ready to accept facts as they are.”   He must have been addressing a convention of individual investors. 

Let me pick-up this week where I left off last week.  If you missed last week’s blog, I suggest you visit that Part I blog to get a better foundational understanding of this week’s Part II.

  1. The mindset of an exceptional trader has the ability to change from bullish to bearish – or vice versa – in a minute.  Mental flexibility is essential, provided you are then able to react appropriately with that new mindset.
  2. Investing is unique.  You can’t turn around a losing trade by trying harder.  If you hit a slump, take some time off and come back slowly.
  3. Without exception, every successful trader Jack Schwager’s met has formulated a specific methodology that fits him or her perfectly.  It’s different for everyone.
  4. When historically-correlated markets stop being correlated, you can bet on a return to normalcy or a regression to the historical mean.
  5. Never let your targets and your goals define your trades.  Leave that to the markets and be flexible.
  6. If you ever feel as if you are frozen in a particular equity position, take 50% of the position and sell it.  If you are still uncomfortable, sell the other half.
  7. Ray Dalio of Bridgewater Associates worships mistakes.  He chronicles each and every mistake, and he then becomes a man obsessed.  Ray and his entire management company focus in and gear up to make sure they never repeat previous mistakes.

The bottom line is this.  In listening to Jack Schwager speak about what is required of a successful investor, I was reminded of the famous quote by Sir John Templeton.  “If we become increasingly humble about how little we know, we may be more eager to search.”

Trade well; trade with discipline!
-- Gatis Roze


1… I am pleased that so many of you have already checked out my Tensile Trading ChartPack 2.0. For those of you who missed it, take a look at what it has to offer. I guarantee that your market analysis will take less time and yield greater insights.

Or check out the sample charts at…

Gatis Roze
About the authors: , CMT, holds an MBA from the Stanford Graduate School of Business and is a past president of the Technical Securities Analysts Association (TSAA). He is also the co-author of Tensile Trading: The 10 Essential Stages of Stock Market Mastery (Wiley, 2016). A full-time investor for over 25 years, Gatis has taught sold-out investment courses throughout the Pacific Northwest and beyond since 2000. Learn More

Grayson Roze
is the author of Trading for Dummies (Wiley, 2017) and Tensile Trading: The 10 Essential Stages of Stock Market Mastery (Wiley, 2016). He has worked in the financial services industry for since 2012, and now serves as the Business Manager for the company. He holds a Bachelor's degree from Swarthmore College. Learn More
Subscribe to The Traders Journal to be notified whenever a new post is added to this blog!

Table of Contents

comments powered by Disqus