At the end... I love it so much... This playbook deserved traders' attention regardless of the method and concept they practice. As previous book on "One Good Trade" was quite good; surprisingly, this book is better...
I enjoy reading this book despite the fact that it is a real thick book! This time around, the author brings us to more of the latest version of SMB Capital. The author had some issues with the death of his mother. At the same time, some top traders left the firm to join competitors. As such, the author needs to reinforce and by then, "the playbook" came into play in his firm. As what many said... pressure creates diamonds... the author showed us how to create diamonds out of it. Thumbs up!
While "One Good Trade" focused on trading as whole, this book digs deep into details set up as well as trade management. The author emphasizes trade review and I think it helps to shape up traders' mind even for non-intraday trader like me. End of the day, as the title mentioned, it is about "an inside look at how to think like a professional trader". Well, objective met!
The only flaw perhaps lies with the fact that this book is not suitable for beginner or novices. Advance traders (regardless of technical or fundamental traders) will understand the insight and substance being an intraday trader thanks to the hard work by the author. For advance traders, they will have no problem in understand every single part of the book. For beginners and novice, it is hard to digest especially when the author does not explain in details into each set up and review.
For a full rating of 10, I personally rate it at 10/10. As I mentioned above, this book is so much better compares to "One Good Trade". Overall, this is a book that was well written (easy to understand) and very entertaining.
Lastly, listed below are some nice quotes from the book:
Trading is a sport of survival, reinvention, and perseverance even for the succesful trader.
Flipping from indicator to indicator or from different time frame to different time frame as your solution to under-performance is a path to trading failure.
Most traders overvalue the importance of the trading day - their trading. The least important part of your trading day is your actual trading. The work you do after to improve and prepare for future trading opportunities is most important.
A passive-buy algorithm (algo) buys some at a whole bunch of different prices without aggressively paying the offer and stepping higher to fill an order.
Trading can be one step forward and then two steps backward. Then a few steps forward. There is never going to be a time when you are not going to run into a wall of progress impeded.
You are not as bad as you think when you feel you cannot make money. You are not as good as you think when you believe you will never have another losing day.
Do not concern yourself with how anyone else is doing. Ever. The bank takes your trading check. It is does not cash your trading partner's. This is a journey about your trading. Do not worry about anyone else, or anyone else's trades.
The experience of low satisfaction or low contentedness in life is associated with impulsive behavior that is an attempt to grab a reward. The remedy with this approach is to teach the trader specific ways to increase the experience of gratitude in their life to counteract the need for immediate gratification.
Most professional traders and poker players lose a majority of the time, but they allow their profitable trades and hands to outweigh the losers. They enjoy taking small losses and understand that it's just part of the game.
You should not come to the show before sorting out your psychological baggage. You cannot trade well with this mind baggage.
I changed my self image from a rookie soldier to a fisherman. To the fisherman, the ocean is a place he respects but also a huge resource he can use. Certainly he knows the ocean is dangerous. So he prepares each trip carefully. But he loves the ocean. He knows what to do when the fish come. From then on, trading became an interesting, challenging and fun game for me.
Trading is kind of like playing tennis and badminton. The player has to quickly move to a neutral (centered) positions after each strike.
Don't make the trade too complicated. It is either going to work or it is not.
If you are not taking on enough risk with your trading, then you are taking on too much risk.
The new field of positive psychology clearly shows the link between happiness and improved performance. Happiness comes first then followed by success.
Successful traders have meaningful attachments or some other source of motivation and happiness outside of the financial markets.
High frequency traders often have access to your stop orders because of their agreements with the exchanges. Sometimes it will be better to set an alert where you will exit and just manually close your position. We do this so that the HFTs do not just run our stops for profit and leave us flat a terrific risk/ reward opportunity.
You are always entering when the momentum is on your side. And a lot of people think that in trading you have to enter at the lowest entry to make the most amount of money, and that is not necessary true. It is very difficult to pick the bottom of a trade without getting stopped out.
You have to stop missing the opportunities in your best setups. With the advance of technology, you have no excuse to miss your best trading opportunities. This is a performance game. Either your maximize your take from the setups that make the most sense to you or at best you under-perform and at worse are eliminated by Mother Market.
