The Traders Journal

Definition of Money Management


Google “money management” and you’ll get back a quagmire of non-sequiturs, disjointed, inconsistent and incomplete information.  There is no single comprehensive definition.  There isn’t even any number of consistently similar definitions.  Yet what do most Market Wizards disclose as one of the keys to their success:  money management.

Frustrated by this sad state of affairs, my stock market class of over 100 investors onced decided to contribute their own personal definitions which I then carefully shifted through and organized.  As a class, we whittled it down to what you see below.  Perhaps then, we could respectfully submit this as the official definition of money management.

Money management is a written, personally-appropriate financial framework describing the types of investments and strategies that you feel will align with your personal goals, objectives and priorities.

  • These guidelines describe the rules and tools you deem appropriate in managing your wealth.
  • They acknowledge your risk tolerance and the risk management techniques you employ to protect your assets.
  • Finally, they provide an ever-changing lifelong timeline and roadmap according to the methodologies and resources you use to ensure disciplined stewardship of your assets as you attempt to maximize the return on your investments.

Trade well; trade with discipline!
-- Gatis Roze

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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 currently serves as Vice President of Operations at, and is also the co-founder of Stock Market Mastery. Grayson holds a bachelor's degree from Swarthmore College, where he studied Economics and Psychology. Learn More
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