2024's TRADING WISDOM

The 'tourist recaps the year's daily "trading wisdom" quotes

Every day, I start the ‘tourist chat with a little bit of “trading wisdom.” Sometimes it’s a classic quote from a legendary risk taker, other times, it’s a pithy line that I stumble on from an interview or a research piece.

There have been many requests to post these bits of wisdom in a central location, but because I didn’t plan correctly, they were all JPG files with limited ability to easily extract the text. Well, this Christmas break, with the help of Mrs. MacroTourist’s hard work, we got 2024’s trading wisdom all transcribed to share.

I have picked out 50 of my favourites to start the list. These weren’t necessarily the most venerable of the quotes, but the ones that I feel important in the current environment — or the ones that just made me smile.

Just a quick note before we get to the quotes. If you want to receive the recap of the private chat feed (which includes the trading wisdom), then please change your settings in your MacroTourist substack account. I have left this more frequent email subscription off by default. If you need any help, just send me a note.

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2024’s TRADING WISDOM

A mistake repeated more than once is a decision.
Jim O'Shaughnessy
Portfolio Manager

In the real world things fluctuate between pretty good and not so hot, but in terms of investors' psychology, it goes from flawless to hopeless.
Howard Marks
Oaktree Capital Founder

If you guys weren't trading bonds, you'd be driving a truck. Don't try to get intellectual when you're in the marketplace. Just trade.
Tim Metz
from "Black Monday: The Stock Market Catastrophe of October 19, 1987"

...we don't learn that we don't learn.
Nassim Taleb
from "The Black Swan"

Like everything else worthwhile, successful investing demands a price. But its currency is not dollars and cents. It's volatility, fear, doubt, uncertainty, and regret — all of which are easy to overlook until you're dealing with them in real time.
Morgan Housel
From the book, "The Psychology of Money"

Every brilliant macro idea I have ever had took years longer than I had anticipated, and destroyed most facets of my life, before I saw it come to fruition.
Jimmy Jude
Self-proclaimed "ex-merc jerk"

I have stated time and again over recent weeks how I disagree with Stan Druckenmiller's commentary that we are in the midst of a difficult trading environment. There are no difficult trading environments, just situations that may not suit a particular trading style.
Paul Krake
Author of View from the Peak

I don't need an analyst to tell me when a 10 P/E stock is cheap. I need an analyst to tell me when a 40 P/E stock is cheap.
Steve Mandel
Founder of Lone Pine Capital

Risk is what's left over when you think you've thought of everything.
Carl Richards
The Behaviour Gap

80% of trading is psychology. The other 30% is being good at math.
Joseph Fahmy
Trader

There are four steps to the [trading] decision making process: collecting date, analyzing, deciding, and implementing. if you are good at those four steps, if you are quick about it, you can make it. For example, I had two guys working for me, one was a graduate of Harvard Law School (second in his class) and the other was an Atlantic Beach ice cream truck driver. I saw the ice cream truck driver with fifty kids going through saying, "I want this, this, and this" and he took care of everybody at the same time. Who ended up making $50 million trading commodities? The ice cream man.
Mark Fisher
one of the biggest energy traders

History never repeats itself. Man always does.
M. de Voltaire
French writer who missed his true calling as a macro PM

An analogy that I like to give is a jam-packed cocktail party where everyone enters the room through a very large door. There is also a small door in the back that nobody notices. If someone yells "Fire!", the logical thing to do is to exit through the large door. The problem is, if everybody heads that way, you might get trampled. The proper strategy then becomes to head towards the small door in the back, even though it's not the most efficient exit strategy in terms of actual physics. The moral of the story is, when things get crowded, you need to adapt your strategy in light of everyone else.
Dr. John Porter
Barclays Capital London, from "Inside the House of Money" by Steve Drobny

Doesn't matter when the Fed cuts. It matters Why the Fed cuts.
Mark Dow
Portfolio Manager

One of the things that I learned from my mentor, Ethan Harris, is that this business is about weighing probabilities, and then choosing your battles with the consensus wisely.
Neil Dutta
Head of Economic Research at Renaissance Macro, on Jack Farley's Forward Guidance

The larger the number of people involved, the easier it was for them to delude themselves that what they were doing must be smart.
Michael Lewis
from "Liar's Poker"

When you're fighting an 800 pound gorilla, the fight doesn't end when you're tired, it ends when the gorilla is tired.
Morris Sachs
of Greenwich Capital Fame, via Paul C from 'tourist chat

The concept of f*ck you money is great, but so is kindness and civility. So I aspire to "no thank you, I'm not interested in that, I respectfully disagree and I'm free to ignore you" money. One is rationalizing being a jerk, the other is intellectual independence.
Morgan Housel
Author

At some point in every investor's career, gold steals their soul.
Harris Kupperman
Hedge Fund Manager

Definition for the term bubble that you can use in real time: you need to use implausible growth expectations to justify the current price (using a conventional discounting cash flow model), and the marginal buyer does not care about valuation models. Nvidia fits that definition. In the year 2000, of the ten most valuable companies on the planet, zero out of ten had beaten the S&P 500 over the next 15 years. One out of ten—Microsoft—had won over the next twenty years.
Robert Arnott
founder of Research Affiliates

I've been investing the way we are investing now for forty years. And it worked. The key is: don't lose your nerve. Nobody ever says, "gosh, last week was so awful, I think I am going to lose my nerve." The danger is that people do the exact opposite of what they know is right, but tell themselves that this is a variation on doing it right. In this, I can taste a turd in the champagne when there is very little of it. I sense when there is any thinking that is different to how we have always done it.
Jonathan Ruffer
Founder of Ruffer Investment Mgt via Behind the Balance Sheet

The defining feature of any asset bubble is, "extrapolation of the unsustainable."
Jesse Felder
Hedge Fund Manager

Generative A.I. will be the biggest [expletive] airball in financial history.
Bill Fleckenstein
Former hedge fund manager

It's easy to go down the rabbit hole and lose all your money ZeroHedge-style, but the sun does rise.
Paulo Macro
Author of the Paulo Macro Newsletter

Many of the trades that Alexander suggested followed one of two patterns. First, when all investors were doing the same thing, he would actively seek to do the opposite. Everyone wants to be a contrarian, but no one is, for the sad reason that most investors are scared of looking foolish. Investors do not fear losing money as much as they fear solitude, by which I mean taking risks that others would avoid. When they are caught losing money alone, they have no excuse for their mistake, and most investors, like most people, need excuses. They are, strangely enough, happy to stand on the edge of a precipice as long as they are joined by a few thousand others. But when a markt is widely regarded to be in a bad way, even if the problems are illusory, many investors get out. The second pattern to Alexander's though was that in the event of a major dislocation, such as a stock market crash, a natural disaster, the breakdown of OPEC's production agreements, he would look away from the initial focus of investor interest and seek secondary and tertiary effects.
Michael Lewis
from "Liar's Poker"

The market gets divided into camps. [Too often,] you have to declare your allegiance. The best traders are those who can hold two opposing opinions in mind at the same time, and understand that it is a messier world than just "inflation" or "deflation".
Warren Pies
3-fourteen Research

In bull markets, the future gets a premium. In bear markets, reality gets a discount.
Jim Chanos
Famous short seller

The most dangerous people in the world are very smart traders who have never gotten their teeth kicked in.
F. Helmut Weymar
Founder of the legendary Commodities Corp.

The tragedy of Asia is that Japan is a profoundly socialist country on which capitalism was imposed, while China is a profoundly capitalist country on which socialism was imposed. But given the chance, both drift back to their natural states.
Louis-Vincent Gave
Founder of Gavkal Research

The main problem with extreme cynicism as an analytical tool is the dosage; a little bit is quite important, but even a little too much can cause symptoms that resemble a brain injury.
Matthew Casey
CEO of Political Risk firm Pozieres Consulting

Whenever I am going through a rough patch as a trader, I remind myself that Soros got stopped out at the lowest tick on the day of the crash, was down close to 60% after the crash, and still closed the year +14%. I can bounce back from a 2 month 10% drawdown. Just lick your chops, nose to the grindstone, and then go for the jugular.
Manjeet Singh
Trader from the MacroTourist chat

It is a curious fact that although all booms are alike, all are different.
Edwin Lefevre
Author

What we do know is that speculative episodes never come gently to an end. The wise, though for most the improbable, course is to assume the worst.
John Kenneth Galbraith
Economist

When it comes to searching for alpha, the macro fundamentals far outweigh geopolitics and politics.
Marko Papic
Chief Strategist, BCA Research

If an opinion contrary to your own makes you angry, that is a sign that you are subconsciously aware of having no good reason for thinking as you do. If someone maintains that two and two are five, or that Iceland is on the equator, you feel pity rather than anger, unless you know so little of arithmetic or geography that his opinion shakes your own contrary conviction. So whenever you find yourself getting angry about a difference of opinion, be on your guard; you will probably find, on examination, that your belief is going beyond what the evidence warrants.
Bertrand Russell
Philosopher, but probably would have really been able to sling macro risk

What makes a great trader? Having the right balance between confidence and humility. There is a confidence level required to say, "the market is wrong" ('cause the market is usually right). But it also requires the humility of saying, "sometimes, I'm wrong." Another trait from good traders is a detachment from emotions. Fear and greed determine markets. I have seen traders who, when they are in that high stress period (either because of fear or greed), change their process. For better or worse, I am able to be detached from my emotions.
John Arnold
The best natural gas trader that has ever lived

Markets always change, that's why it's so easy...
Trader V. G.
via my trading pal that busted my gut the other day with this line

I watched a lot of really smart people go out of business shorting tech during the DotCom bubble. Then, I watched a lot of really smart people go out of business staying long tech during the DotCom crash.
Stock Market Wizard
recalling the difficulties of trading bubbles

Extremely crowded trades rarely work extremely well.
Walter Deemer
Trader

This is my view of a year in the life of a trader: Four out of twelve months you are hot. You are so excited that you can't sleep at night. You can't wait to get to work the next day; you're just rolling. Two months out of the year, you are cold. You are so cold, you are miserable. You can't sleep at night. you can't figure out where the next trade is going to come from. The other six months out of the year, you make and lose, make and lose.
Brian Gelber
Market Wizard

Government policy doesn't react until the shark is right next to the boat.
Rick Rieder
BlackRock CIO

Every age has its peculiar folly—some scheme, project, or fantasy into which it plunges, spurred on either by the love of gain, the necessity of excitement, or the mere force of imitation.
Charles Mackay
from "Extraordinary Popular Delusions and the Madness of Crowds", via chat h/t Jim Miller

Question: What does the long-term mean to you?
Cliff: The long-term means a period, in which even if you are right, your investors have left already.
Clifford Asness
Founder of AQR

In France, two consenting adults can do whatever they want to each other. Except if they work for one another. Then the government has to be involved every step of the way.
Louis-Vincent Gave
founder of GaveKal Research

You've got to ride the wave, but get off before it crashes into the shore.
Rick Rieder
BlackRock CIO

Don't ask a trader what he thinks. Ask, what's his position?
The Currency Whisperer
One of the nicest, smartest traders I know

You must have confidence to trade in the market, because the most serious loss of all is the 'loss' of confidence in your ability to trade independently and successfully.
Stanley Kroll
1970s commodities speculator

When you want a deal real bad, you get a real bad deal.
T. Boone Pickens
famed oil trader, via Louis-Vincent Gave

The investment process is only half the battle. The other weighty component is struggling with yourself, and immunizing yourself from the psychological effects of the swings of markets, career risk, the pressure of benchmarks, competition, and the loneliness of the long distance runner.
Barton Biggs
Legendary Wall Street Strategist

The best traders have no ego. You have to swallow your pride and get out of the losses.
Tom Baldwin
Bond trader and Market Wizard

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THE REST OF 2024’s TRADING WISDOM

Only the needy and the greedy are still trading.
Trading Lore
Line my trading buddies use when we're sitting around and not much is going on during a slow day…

An economist is a portfolio manager who never marks to market.
Howard Marks
Oaktree Capital Founder

It is not worthwhile to try to keep history from repeating itself, for man's character will always make the preventing of the repetitions impossible.
Mark Twain
Author, but we all know, he would have made a great hedge fund manager

Heard on the street:
"Insiders sold $33 billion of that stock over the last year."
"I guess the outsiders see more value…"

Remember: for most investments, sizing is more important than entry level.
Harley Bassman
Founder of the MOVE Index

If everyone's waiting for a pullback to buy, either the market doesn't have a pullback, or, if it does, you shouldn't buy into it.
Bob Farrell
Merrill Lynch Strategist

If you need an indicator to tell you whether sentiment is extreme, it's not.
Walter Deemer
Technician

What is NOT happening can be more important than what is.
Mark Dibble
Fidelity

In bull markets, stocks don't got down on bad news. In bear markets, stocks don't go up on good news.
Harold Ehrlich
Bernstein-Macaulay

Just when you find the key to the market, they change the locks.
Gerald Loeb
E.F. Hutton

You know, if baseball umpires were on the front page of the sports sections every week, you'd know something was desperately wrong with the game.
Jim Grant
Grant's Interest Rate Observer

Jay [Pritzker] taught me to use simplicity as a strategy. He had an uncanny ability to graph an extremely complex situation and immediately locate the weakness. He says that if there were twelve steps in the deal, the whole thing depended on just one of them. The others would work themselves out or were less important. He had a laser focus on risk.
Sam Zell
Probably the greatest real estate investor

Among my most salient takeaways was the value of optionality.
Sam Zell
Probably the greatest real estate investor

Trying to be right 100% of the time leads to paralysis.
Sam Zell
Probably the greatest real estate investor

Opinions about facts are what sets prices.
Jim Chanos
Legendary Short Seller

I have a rule that whenever I'm still thinking about a position when I lay my head on my pillow at night, I being liquidation the next morning. If I find myself praying about a position at any time, I liquidate it immediately. That's a sure sign of disaster.
Mark Ritchie
From the book, "The New Market Wizards" by Jack D. Schwager

The lesson to be learned is that financial markets need to be supervised. Only some kind of intervention, be it legislative, regulatory, or a gentle hint from a central bank, can prevent boom/bust sequences from getting out of hand.
George Soros
"Alchemy of Finance"

The more effortless and natural the trading process, the better the chances for success. As the anonymous trader in "Zen and the Art of Trading" put it, "In trading, just as in archery, whenever there is effort, force, straining struggling, or trying, it's wrong. You're out of sync; you're out of harmony with the market. The perfect trade is one that requires no effort."
Jack D. Schwager
"The New Market Wizards"

Price is unique—it's the only indicator that can't diverge from itself.
Ned Davis
Via Meb Faber

Your personal experiences with money make up maybe 0.0000000001% of what's happened in the world, but maybe 80% of how you think the world works.
Morgan Housel
Author

The best way to suss out investors' conviction level is to see where they are actually going to sell their put. The same thing with buyside price targets. You don't really know what someone thinks until you ask, "Ok, are you going to overwrite that price target?" Almost always they say they have a conviction level of 90% where the reality is that it is 60%, so it means something when there is actually a 90% conviction level.
Amy Wu Silverman
Head of Equity Derivatives at RBC, Dean Curnutt's Alpha Exchange Podcast

One of the things that I almost thought was an unfair fight was the hedge fund/portfolio manager who had a deep background, not just in the fundamentals of an equity, but also understood volatility. Sort of mapping an implied distribution tha was exceedingly well informed versus a sell-side trader who was going to commit the capital, but was really looking more at percentiles of richness or cheapness on the implied side, and not necessarily nearly as informed on the fundamental side.
Dean Curnutt
Host of the Alpha Exchange and Institutional derivatives trader

Gold! Gold! Gold! Gold! Bright and yellow, hard and cold. Spurned by the young, but hugged by the old. To the very verge of the churchyard mould.
Thomas Hood (1798-1843)
Poet (and probably would have been a bitcoin rapper with spikey hair and a nose ring if alive today...)

When it comes to equities, I hate being in a consensus trade because you're at the mercy of the next marginal buyer. When you buy fixed-income, you just have to be right because eventually you have a maturity.
Dawn Fitzpatrick
CEO & CIO of Soros Fund Management

The worse thing that happened to economics was econometrics because economists went from being generally correct to precisely wrong.
Barry Knapp
Author of Ironsides Macro, recalling one of his favourite quips about economists on his weekly podcast

One of the great things about portfolio management (and a good lesson to learn from this): you don't take large positions in things that are going to make ten times your money; we took big positions in things we didn't think we would lose money in.
Joel Greenblatt
Hedge fund manager, speaking at the Hedge Fund Association Fire Side Chat

A mania first carries out those that bet against it, and then those that bet with it.
Jim Rogers
Market Wizard

If you worry, you don't have to worry. And if you don't worry, you need to worry, 'cause if you worry, you will make sure the thing you worry about doesn't happen.
Ray Dalio
Founder of Bridgewater, speaking at Bloomberg Invest NY

The process by which banks create money is so simple that the mind is repelled.
John Kenneth Galbraith

It should be compulsory for traders to have a break after a big win. In my experience, rarely does anything good come of chasing another payoff immediately. the ego boost clouds your judgement 9 times out of 10.
Trader Ferg
@trader_ferg

We make so much money because our competition plays in their pajamas. That's just been a homerun for us as it's a markets business. When you have everyone under one roof, information movves much faster between team members.
Ken Griffin
Founder of Citadel

"We don't say, "It's cheap today, but it'll be cheaper in six months, so we'll wait." If it's cheap, we buy. If it gets cheaper and we conclude the thesis is still intact, we buy more. We're much more afraid of missing a bargain-priced opportunity than we are of starting to buy a good thing too early. No one really knows whether something will get cheaper in the days and weeks ahead—that's a matter of predicting investor psychology, which is somewhere between challenging and impossible. We feel we're much more likely to correctly gauge the value of individual assets."
Howard Marks
Founder of Oaktree

When you call out of a company and say, "Chef Boyardee appears to be auditing your books", they don't like that. So you get the pushback. As a general matter, over time, I have come to the view that it's probably not worth it and in the last couple of years, we've stopped discussing our negative views about companies. We still make the investments against them, but we don't need to discuss it and the market will sort it out. The market doesn't need us to educate it about what we think about these companies. Maybe I have grown up or maybe I have been punched in the face enough times to change my behaviour.
David Einhorn
Founder of Greenlight Capital, speaking at the Cambridge Union

The Indian model was that the economy grows at night because that's when the government sleeps.
Louis Gave
Founder of Gavekal h/t to Brent Donnelly for highlighting

For the first time in 25 years, we are paid to not have a view because money is not free anymore. If interest rates are zero, then we have to have a view all the time because any decision to step out of risk assets is a career decision if you're not paid to wait. That's now completely flipped on its head. If we can get 5.5% to 6% on a U. S. T-bill, we don't need to have a view on all these things. We are paid to wait.
James Aitken
Founder Aitken Advisors, on Ted Seides Capital Allocators Pod

A lot of people would call sentiment technical: I don't. I find sentiment to be the next most important group after the monetary. The monetary is the most important signal because it tests better in the longer run. But I'll be the first to tell that it's possible to have a stock market in an uptrend with interest rates going up, and you can have a downtrend stock market with interest rates going down.
Marty Zweig
legendary market strategist

The hardest day to invest is...today.
Ted Seides
from the Capital Allocators Podcast

Risk cannot be destroyed, only transformed.
Corey Hoffstein
Founder of Newfound Research

"Most of the money I've made in my life has been when other people didn't like what was going on. When things are cheap, that's the opportunity."
John Malone
American cable baron h/t my favourite retail broker morning email

There is an old trading expression: "Never Short a Boring Market." We can rephrase that to: "Never be short carry when you lack clarity."
Paul Krake
Author, View from the Peak

It has been known for decades that there is no correlation between risk, as the academics define it, and return. Higher volatility does not give better results, nor lower volatility worse. Studies have shown that there is not necessarily any stable long-term relationship between the return achieved and the risk taken. Volatility is not risk.
David Dreman
Chairman of Dreman Value Management

We tell our clients all the time that returns are greatest when capital is scarce. What's more tantamount today? It's the inverse of that. Risks are greatest where capital is concentrated and expensive.
Dan Suzuki
Richard Bernstein Advisors Deputy CIO

The 2010s will go down in history as the easiest environment asset owners have ever seen. You just had to buy anything. It didn't matter what you bought. The more of it you bought, the better it was. When you look at vol-adjusted returns of bonds, stock, tech stocks—they all ended up at approximately the same thing. You just had to buy a lot of them f it was bonds and less of them if it was tech stocks. On a risk-adjusted basis, buying anything worked. Anytime there was a dip in the price, you just bought more of it. When you look back in history, that's a unique environment.
Luke Ellis
Man Group CEO

The market often takes the most painful route to the most obvious place.
@AaronRentfrew
via @Michigandolf

"A lot of mistakes in life come when you think risk is caused by external forces, when in fact the weight of your own success is enough to pull you down without any outside help."
Morgan Housel
Author

Value investing is like watching paint dry—except I bring a hair dryer.
Seth Klarman
Recounting an anecdote told to him by Bill Ackman

No one ever gets hit by the trade they see coming.
Jeff Currie
Goldman Sachs commodity strategist

I like large moves in markets as much as the next guy. i prefer them when there are no news or stories going on.
@AnyonCurve
found on twitter

You never get killed jumping out of a basement window.
Jerry Haworth
CIO 36 South

If I can't get over the emotions of taking a loss in twenty-four hours, then I'm trading too large or doing something else wrong.
Gil Blake
from "The New Market Wizards" by Jack D. Schwager

The median voter is the price maker in the political marketplace. Politicians are the price takers.
Marko Papic
from "Geopolitical Alpha"

I contend that financial markets are always wrong in the sense that they operate with a prevailing bias, but in the normal course of events they tend to correct their own excesses. Occasionally, the prevailing bias can actually validate itself by influencing not only market prices but also the so-called fundamentals that market prices are supposed to reflect...The change in the fundamentals may then reinforce the biased expectations in an initially self-reinforcing, but eventually self-defeating process... When they occur, boom-bust processes can take on historic significance.
George Soros
from "The New Paradigm for Financial Markets"

No trader who achieved sustained success did so because they learned to beat the market. They did so because they learned to beat themselves. Beating the market is not that difficult, as paper trading demonstrates. Beating yourself, however, that's the challenge of a lifetime.
Steve Goldstein
Performance Coach to Traders

I watch the market action, using fundamentals as a backdrop. I don't use fundamentals in the conventional sense. That is, I don't think "Supply is too large and the market is going down." Rather, I watch how the market responds to fundamental information.
Randy McKay
Trader from "The New Market Wizards" by Jack D. Schwager

The margin clerk is never wrong.
Morris Sachs
Head of the Greenwich Capital prop desk

A few months trading natural gas futures at a professional level is worth four years at Harvard Business School.
Jimmy Rogers
The Adventure Capitalist

In trading, you have to become the house, where you bet small enough that, when you go through a bad streak, you're not going to lose all your chips. But you have to bet big enough that it matters.
Mark Fisher
one of the biggest energy traders

Pairs trading: twice the risk for half the profit...
Anonymous
Trading "wisdom" passed on from generation to generation

I believe Meb Faber has reference a study where people were given tomorrow's news and still botched their trading. Meb Faber: here's a good example. I'm going to tell you ahead of time in March 2022 that the Fed Funds rate is going from zero to five percent a year later. your only question would be, "How many S&P 500 puts can I buy?" And yet, the stock market is UP, not down.
Dave Cervantes

Incidentally (having just Googled it), it seems that the last time a Canadian team won the Stanley Cup was 1993. Which happens to be when Maastricht started to be implemented. Coincidence? I think not. i think we can DEFINITELY blame the EU for this as well.
Louis Vincent-Gave
Founder of Gavekal Research (tongue firmly in cheek)

I learned at a young age that markets are much bigger than the people working them. You can't outlast a market.
Craig Effron
Founder of Scoggin Capital Mgt, from "Hedge Hunters" by Katherine Burton

If you buy for a reason, and that reason is discounted or is no longer valid, then sell! The cheap get cheaper, the dear get dearer. Every indicator eventually bites the dust. Adapt to change.
Marty Zweig
via Meb Faber

There's always something to worry about. Everyone has got the brain power to be in the stock market, the question is whether they have the stomach... People thought the only reason we got out of the [1930s] depression was WWII. And [they figured] the next time we have a recession, we will have another depression—and it's going to be a Great Depression. So people weren't buying stocks in the 50s 'cause they thought another depression would happen. In addition, they were very scared about nuclear war. Something about going to Vermont, building a fall-out shelter, stocking it with canned goods—that doesn't make you want to buy growth stocks. i think that the older you get, the more nervous you get about all these things. The reason younger people are better investors is that they haven't heard about all these crises.
Peter Lynch
Legendary Fidelity PM

Your positions should always be driven by the exposures you want to have, not primarily driven by what the market gives you. Even if your conviction doesn't change, you sometimes need to adjust your exposures in response to the market to avoid taking outsized risk in a small number of names—particularly important in a volatile market.
macrocephalopod
trader whose passion is "providing best-in-class liquidity in the marketplace of ideas"

In 1987, I made $4.4 million. In 1988, I made $90,000. Look, I've seen up and I’ve seen down and I understand that you got to stay calm. The minute you start to believe in all the accolades that they throw at you, then that's when the market is going to show you. I've seen it happen to the biggest guys. I've seen Richard Dennis take $600 million and lose 300 of it in six months. And Victor Niederhoffer, too.
Lewis Borsellino
S&P pit trader from "The Best Trading Markets Conversations with Top Traders" by Marder and Dupee

The main thing that [Druckenmiller] learned from Soros was that position sizing was 70% to 80% of the game. Purportedly, George Soros made money on fewer than 30% of his trades. And that alone is worth letting settle in a bit...
Michael Mauboussin
from Brandon Beylo

I would rather have a mediocre strategy and a good money management system than a good strategy and a mediocre money management system.
Marder and Dupee
from "The Best Trading Markets Conversations with Top Traders", quoting an anonymous trader

There are four kinds of economies:
1. Underdeveloped
2. Advanced
3. Argentina
4. Japan.
Argentina is an economy that has had every chance to be successful but still isn't, and Japan is an economy that has had every reason to fail, but still hasn't.
Simon Kuznets
Economist

Bud Fox: "Bluestar, Mr. Mannheim. Put all your clients in it. It's gonna move." Lou Mannheim: "I don't know where you get your information son, but I don't like it. The main thing about money, Bud, it makes you do things you don't want to do."
Lou Mannheim
from "Wall Street" (apart from his overly hard money views, Lou was the only decent fellow at Jackson Steinem & Co.

I think the period from October 1999 to February 2000 has been one of the most difficult times of trading that I've seen in a long time. Here you are watching the Nasdaq making all-time highs, and you want to buy the Spoos but they keep beating them up. Every time the Nasdaq makes a new high and you go to buy them, the S&Ps get a little rally. Then the Dow sells off and the S&Ps sell off and you get chopped up.
Lewis Borsellino
CME floor trader in an interview nearly 1/4 century ago, proving nothing is new in trading

As is always the case early in the rate cut or rate hike cycle...We are in the "too much is priced in, dude!" phase. In most rate cycles, everyone rages that too much is priced in, but too little ends up being priced in.
Brent Donnelly
Trader and author AM-FX letter

The art of investment is the discipline of inaction in the absence of a good opportunity, but aggressive action when one is identified.
Li Lu
via @witty_smart

Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.
Warren Buffett
via Joshua Adler

I've held my nose and invested in companies with poor governance, usually because the valuation made up for it. This has never worked out.
Sidecar Investor
via twitter

I don't want an analyst who has never traded—the type of person who does a calculation on a computer, figures out where a market should be, puts on a big trade, gets caught up in it, and doesn't stop out. And the market is always wrong; he's not...
Michael Platt
Hedge fund manager, speaking at the Hedge Fund Association Fire Side Chat

In a strict sense, there wasn't any risk—if the world had behaved as it did in the past.
Merton Miller
from "When Genius Failed: The Rise and Fall of Loong-Term Capital Management"

When do the reflexive connections which are endemic in financial markets turn into self-reinforcing, historically significant processes which affect not only the prices in the financial markets, but also the so-called fundamentals that those prices are supposed to reflect? There has to be both some form of credit or leverage and some kind of misconception or misinterpretation involved for a boom-bust process to develop.
George Soros
from "The New Paradigm for Financial Markets" by George Soros

Copy from one, it's plagiarism. Copy from two, it's sell-side research.
Neil Dutta
Renaissance Macro Economist

The biggest risk to the economy is when excesses in the real economy start translating into excesses in the financial markets. That's when you have big problems. That's not what we have right now. [Instead], we have inventories still pared to the bone, a sluggish business investment over the last year (particularly in equipment), obviously housing is not doing great—but where's the excess?
Neil Dutta
Renaissance Macro Economist

[Michael Marcus] also taught me one other thing that is absolutely critical: You have to be willing to make mistakes regularly; there is nothing wrong with it. Michael taught me about making your best judgement, being wrong, making your next best judgement, being wrong, making your third best judgement, and then doubling your money.
Bruce Kovner
Hedge Fund Manager

When a market makes a range expansion, it is giving you a clear signal it wants to move in that direction...
Paul Tudor Jones
Hedge Fund Manager, via Nitin

Q: How would you describe your particular style of investing? Soros: My peculiarity is that I don't have a particular style of investing or, more exactly, I try to change my style to fit the conditions. If you look at the history of the Fund, it has changed its character many times. For the first ten years, it used practically no macro instruments. Afterwards, macro investing became the dominant theme. But more recently, we started investing in industrial assets. I would put it this way: I do not play according to a given set of rules; I look for changes in the rules of the game.
George Soros
from "Soros on Soros: Staying Ahead of the Curve" via Horse from Traderade

Remember, the market doesn't beat a player. It merely gives him a chance to beat himself.
1989 Commodity Trader's Almanac
via book by Jason Alan Jankovsky

The laziness with which people attach premiums to companies just because they see the word "A.I." is terrifying because at some point in time, reality will play out and it's not going to match those expectations.
Aswath Damodaran
NYU professor (the "Dean of Valuation")

"...the true start of the financial crisis was in August of 2007 when money markets stopped working...The S&P 500 actually went on to make new highs in the next two months."
Colm O'Shea
from "Hedge Fund Market Wizards" by Jack Schwager via @jedimarkus77

r* is basically a lie. In the 2010s they used it to justify never hiking. Now they are using it to justify keeping policy tight. It's like the joke about the Bundesbank in the 70s: they only looked at money supply when they couldn't think of any other reason to hike rates.
Dario Perkins
Strategist at TS Lombard

I like to know what the consensus view is because you really do make the most money when the consensus shifts.
Michael Platt
Hedge Fund Manager

Never play macho man with the market.
Paul Tudor Jones
Hedge Fund Manager

Right now, you are seeing real China internationalization... mostly because of what the US has done with Russia.
Jason Bedford
China expert via Paul Podolsky's podcast, "Things I Didn't Learn in School"

The problem always comes down to ego...which gets in the way of making money because they can never admit they are wrong.
Michael Platt
Hedge Fund Manager

Politics is about 'what should be"' Investing is about 'what is'. As an investor, you have to separate that out. Politicians always want to be the star of the show, it’s a shame that investors watch that show.
Richard Bernstein
RBAdvisors

In 1957, the 10 largest stocks in the S&P 500 have underperformed an equal-weighted index of the remaining 490 stocks by 2.4% per year. But the last decade has been a very notable departure from that trend, with the largest 10 outperforming by a massive 4.9% per year on average.
via Meb Faber's The Idea Farm

The Heisenberg principle in physics provides an analogy for the markets. If something is closely observed, the odds are it is going to be altered in the process. If corn is in a tight consolidation and then breaks out the day the Wall Street Journal carries a story about a potential shortage of corn, the odds of the price move being sustained are much smaller. If everybody believes there is no reason for corn to break out, and it suddenly does, the chances that there is an important underlying cause are much greater.
Bruce Kovner
Hedge Fund Manager, Market Wizards

When I enter the inevitable losing streak that befalls every investor, I pick up "The Alchemy [of Finance]" and revisit Mr. Soros' campaigns. Studying how he coped with adversity provides an excellent tutorial for breaking the string of negative behaviours that occasionally besets any investor.
Paul Tudor Jones
foreword, "The Alchemy of Finance" by George Soros

If the opposite of "pro" is "con", then the opposite of progress is...
Sam Stovall
Chief Strategist CFRA Research via Ryan Detrick

I learned this method for dealing with disasters; you just make a little progress every day. And progress compounds, a bit like money compounds. You don’t see a lot of progress in the first few weeks, but then, thirty days in , [it becomes more obvious]. you can't look up at the mountain top to where you used to be, 'cause then you'll give up. But just make step by step by step and then, ninety days in, you are, "ok, I was way down there." And then one day you wake up and you're, like, "wow, it's amazing how far I've come."
Bill Ackman
Hedge Fund Managere on Lex Fridman Podcast

A lot of my style is to build a thesis. hopefully, one that no one else has built; you sort of put some positions on, and then when the thesis starts to evolve, and people get on, and you see the momentum start to change in your favor, then you really go for it. you pile into the trade. It's not all-in right away. Normally, I'll wait for—I'll go in with, say, a third of a position, and then wait for price confirmation. And when I get that, when I get a technical signal, I go.
Stanley Druckenmiller
being interviewed by Kiril Sokoloff of 13d

I told my wife, "We can't go out for dinner anymore. I just can't take another person telling me how much money they made day trading in the stock market. We can't go out anymore until there's a crash and people become sensible again." ('tourist note: I think this is a story from the late 1990s, but I have to wonder how much of a hermit Bruce became in the ensuing years...)
Bruce Berkowitz
Legendary hedge fund manager

You can lead a banker to liquidity, but you can't make him lend.
Mark Dow
Hedge Fund Manager

Nothing so undermines your financial judgement as the sight of your neighbor getting rich.
JP Morgan
Banker

You want to take as many small bets and add them up as many times as possible to squeeze that alpha over time. There will always be a case for humans as their ability to synthesize information, even in a world of A.I., on a multi-month time scale is timeless. (I am definitely plagiarizing one of the leaders of our industry who said that recently, but it's a great statement).
Will England
CEO of Walleye Capital

When financial markets implode, convexity can be found lurking near the scene of the crime.
Harley Bassman
MOVE Index founder, via Dean Curnutt at Alpha Exchange

The correlation of vol, and the vol of correlation, are not your friend.
Dean Curnutt
Trader and host of Alpha Exchange

The most important thing I've learned about short selling:
1. Short the industries/sectors that are in decline, or at least nobody thinks about anymore,
2. No mater how dumb the fundamentals are, skip sectors that are growing, getting more popular, etc.
David Orr
Investor

I'll never forget. I walked into his office (and the fund at the time was $7B) and I told [Soros] I wanted to put on a $7 billion position of long the Deutsche Mark and short the Pound. I explained my reasoning to him (which I thought was very sound). he looked at me with the most disgusted look. I was getting angry from his body language feedback. And then he said, "Look, you only get an opportunity like this where it is a one-way bet, maybe two, three times in your career. You're just not betting enough. We shouldn't put 100% of the fund in this trade. We should put 200% of the fund in this trade because the most you can lose is a half percent and we can make 20% in it. your risk/reward is tremendous."
Stanley Druckenmiller
Hedge Fund Manager

In October, the fund [Long Term Capital Management] got a positive jolt: Merton and Scholes won the Nobel Memorial Prize in Economic Science. Merton, who was teaching a class at Harvard, got a three-minute ovation from his students. He humbly warned, however, "It's a wrong perception to believe that you can eliminate risk just because you can measure it."
Roger Lowenstein
from "When Genius Failed: The Rise and Fall of Long-Term Capital Management"

It is essential to remember that virtually all surprises are unpleasant.
Warren Buffett
who obviously never found that hidden bag of chips in the back of the pantry after coming home from a long night of drinking

We're consistently inconsistent. It's one of the cornerstones of our success.
David Tepper
Appaloosa Management Hedge Fund Manager (and one of the greatest risk-takers to ever live)

At some price, a great business becomes a speculation.
Bruce Berkowitz
Fairholme Funds Manager

The greatest short-seller ever, Jesse Livermore, made $100m in '29, and he then went bankrupt in '36 and killed himself.
Stanley Druckenmiller
via MastersInvest.com

The key is to wait. Sometimes the hardest thing to do is to do nothing.
David Tepper
Appaloosa Management

One of the great things about markets is that there is always a price. And that price is the truth. You might not accept it. Fund managers only get in trouble when they don't believe the price. When they "can't handle the truth." The best opportunities come around when there is a truth that investors cannot accept.
Russell Clark
author of "Capital Flows and Asset Markets"

If I can convince my wife, I am going to get two dogs. I will call one "financial" and the other "repression". That's going to be my forward-looking statement on what's coming.
Jonathan Ruffer
Founder of Ruffer Investment Mgt via Behind the Balance Sheet

The Fed was reacting to inflationary forces that were coming from Asia, from China. They were the residual—what was left after the Chinese had determined their monetary policy (which was not to let the exchange rate go up). Mechanically, the Chinese and other Asian countries ended up buying a huge amount of treasuries, depressing the yield curve. They ended up exporting deflation as they wouldn't let their exchange rates go up. They ended up overinvesting (particularly China where there were huge amounts of capital flowing into investment, further depressing global inflation). Throughout this, the Fed had an inflation target, and they adjusted to this. They were not the key drivers to the global monetary system. They were reacting.
Russell Napier
Financial historian

Inflation is like a bad neighbour, once he shows up, only thing to get rid of him is for you to move.
Zack Howard
tourist subscriber and pithy market slogan writer

One of the things I have learned as a portfolio manager—maybe "the" hardest thing to do as a PM—is to do nothing.
Steve Eisman
Neuberger Berman Portfolio Manager

There is another way where you do have your cake and eat it, too. You keep interest rates low and you do have a strong Yen, but it's by effectively ending a market by saying to Japanese financial institutions, "You will sell your overseas assets and you will buy these JGBs." That is not a market solution, but it is a solution. This is the sort of thing you pick up as a financial historian, but you don’t pick up as an economist because economists are trained to believe there is only one system (a market system), but this is a political economy system. It's unexpected because it is moving away from a free market.
Russell Napier
Financial historian

I'm looking to arbitrage incompetence.
Gerry Cardinale
RedBird Capital Founder

The head of Goldman's Private Equity comes by and asks, "How are you guys doing today?" [The S&P 500 was down 7% at this point in the day.] I said, "Flat." He was smart, and got that this was awesome, but then he said, "Me too." I had my first argument about private equity vol that day.
Clifford Asness
founder of AQR Capital Management

We're not trying to outsmart the smart guys. We're trying to sell bonds to the dumb guys.
Mike Vranos
Kidder Peabody trader, 1994 quote, according to colleagues who talked about him to the WSJ May 20th, 1994

Progress is cumulative in science and engineering, but cyclical in finance.
Jim Grant
Grant's Interest Rate Observer

If it grows like a weed, it is a weed.
Baillie Gifford
Explaining banking to Russell Napier many decades ago

Estimates miss earnings, not vice versa.
market lore from Mastersinvest.com

In September 1996, I wished to buy into a hot new issue with the idea of flipping it at the close on the first day of trading. Rises of 20% on that first day have been typical over the past 30 years. The underwriter told me they had to be sure I wasn't a flipper before they decided how much of my order would be filled. My partners immediately indicated that in hot markets like these, you have to sleep with the underwriters to get full allocation. I accepted a partial fill...
Victor Niederhoffer
from "The Education of a Speculator"

Since the early 1990s, about 80% of the U.S. dominance has come from relative price/earnings multiple expansion versus non-U.S. stocks. People were paying less for the U.S. at the beginning and now they are paying considerably more. Maybe that is justified; maybe things like U.S. tech dominance are real. But justified doesn't mean repeatable. Justified at best means something isn't going to reverse in a big way. Looking to the future, the case that the U.S. will have permanently higher equity returns is pretty untenable. Even if U.S. companies are worth it, they are priced as such.
Cliff Asness
Founder of AQR Capital Management, via D. R.

You don't see any Fifth Avenue mansions built by bears.
James R. Keene
19th Century stock broker, via Mastersinvest.com

History does repeat itself, just not with precision.
Larry Williams
trader and father of actress Michelle Williams

The more certain the cash flows, the more the discount rate matters.
Mark Dow
Hedge Fund Manager

The paradox of risk-taking is inescapable. You have to take it to be successful in competitive, high-aspiration arenas. But taking it doesn't mean you'll be successful; that's why they call it risk. Investors must accept that success is likely to stem from making a large number of investments, all of which you make because you expect them to succeed, but some portion of which you know won't. you have to put it all out there. you have to take a shot. Not every effort will be rewarded with high returns, but hopefully enough will do so to produce success over the long term. That success will ultimately be a function of the ration of winners to losers, and of the magnitude of the losses relative to the gains. But refusal to take risk in this process is unlikely to get you where you want to go.
Howard Marks
Founder of Oak Tree Capital

Disclaimer—Silver, more than any other commodity with the possible exception of natural gas, exists to part people from their money.
Paulo Macro
channeling his inner Stanley Kroll

Corrigan, his stomach churning, called Bankers Trust. It was a very tough presentation. Goddammit, you've got to fall in line, you've got no choice. The Bankers on the other end of the phone felt pressure, they knew that they didn't really have any choice but to do what Corrigan wanted them to do. ...one brokerage house owed some $600 million to another brokerage house and was delaying the payment, unsure of the other firm's condition or even its solvency. If they paid, would they in turn be paid what they were owed by other firms? This was precisely what Corrigan feared—one firm choking, stopping the flow. Rumours were flying. He argued that there was no insulation for any one bank or firm. If the system came down, everyone would go with it...he tried to sound calm. The payment was made.
Bob Woodward
from "Maestro: Greenspan's Fed and the American Boom", recounting the days around the 1987 stocke market crash

You wanna be in the bubble riders; guys who'll buy 30-delta calls on the next bubble, and get it right over and over.
Harris Kupperman
CIO Praetorian Capital, describing the type of fund managers that investors should give their money to in the coming years.

Whenever I enter a position, I have a predetermined stop. That is the only way I can sleep. I know where I'm getting out before I get in. The position size on a trade is determined by the stop, and the stop is determined on a technical barrier. I never think about [stop vulnerability], because the point about a technical barrier—and I've studied the technical aspects of the market for a long time—is that the market shouldn't go there if you are right.
Bruce Kovner
Hedge Fund Manager and founder of Caxton

I've just returned from three days of meetings in Sydney, two in Singapore, and two in Hong Kong with our mining research team. 35 meetings, 55 institutional investors, and 48 (hours) total on an airplane...and I can honestly say interest was at a level I haven't seen. Copper, uranium, precious metals...no one is positioned, everyone is watching, pullbacks will be bought and, like always, price action means something. There is clearly something going on when you look at these moves. And this trip felt very real and it felt early.
Winston Miles
Head of Institutional Sales at Eight Capital (Winston was spot on as a lot of these resource stocks are absolutely ripping...)

Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected.
George Soros
Hedge Fund Manager

"You asked, is the neutral rate moving up because of fiscal policy? Yes. I mean, there's—there should be an effect if you have increased deficits that should put upward pressure..."
Jerome Powell
Fed Chair, speaking June 13, 2018, highlighted by Warren Pies 3-fourteen Research

"A capitalist economy cannot be maintained, however, if it oscillates between threats of an imminent collapse of asset values and employment, and threats of accelerating inflation and rampant speculation, especially if the threats are sometimes realized."
Hyman Minsky
Economist, highlighted by Warren Pies 2-fourteen Research

J.M. replied sympathetically, but Long Term kept squeezing Merrill all the same. The firm seemed willfully tone-deaf, even at the risk of souring key alliances. One time, it too advantage of a technical loophole in a loan document to make $7 million at Merrill's expense. When an executive protested, J. M. frowned and said, "I didn't realize." But he didn't back down.
Roger Lowenstein
from "When Genius Failed: The Rise and Fall of Long-Term Capital Management"

We're in the research business. The core of this business is research. Whether it's old-fashioned stock picking, or forecasting the weather to trade commodities—it's a research business first and foremost. And trading is simply how we monetize our research.
Ken Griffin
founder of Citadel

There are three great themes [right now]:
1. Artificial Intelligence
2. Everything to deal with infrastructure
3. Crypto.
I believe in the first two and I don;t believe in the third. Crypto is just another way to speculate on speculating.
Steve Eisman
Neuberger Berman Portfolio Manager

Perhaps it is one secret of their power that, having studied the fluctuations of prices, they know that history is inflationary, and that money is the last thing a wise man will hoard.
Will Durant
American Historian

[The majority of market participants] want to take the "economic under" because of a decade of austerity prior to COVID.
My favourite anonymous hedge fund manager
(who happens to be "wicked smart" and equally nice.

During this new stage of the depression, the refugee gold and the foreign government reserve deposits were constantly driven by fear hither and yon over the world. We were to see currencies demoralized and governments embarrassed as fear drove the gold from one country to another. In fact, there was a mass of gold and short-term credit which behaved like a loose cannon on the deck of the world in a tepest-tossed era.
Herbert Hoover
U.S. President, highlighted by Paulo Macro

Fear and greed are very powerful. But there is something that is more powerful than both—and that's need. If you need to do something, you don't have a choice.
Jeff Gundlach
Bond Portfolio Manager, as recounted by Grant Williams

Trading is the hardest way to make easy money.
John Hill
Trader

Over the past 15 years, both Internet stocks and houses have demonstrated the extraordinary excesses that can be created by combining an initially sensible thesis with well-publicized rising prices. In these bubbles, an army of originally skeptical investors succumbed to the 'proff' delivered by the market, and the pool of buyers—for a time—expanded sufficiently to keep the bandwagon rolling. But bubbles blown large enough inevitably pop. And then the old proverb is confirmed once again: 'What the wise man does in the beginning, the fool does in the end.'
Warren Buffett

We have nothing to fear, but the lack of fear itself.
Walter Deemer
Trader

When a trader starts to feel really smart, he or she is headed for a huge drawdown.
Peter Brandt
Trader

"You have to be obsessive, you have to have guts, you have to know when to stick to your convictions and when to walk away," says Armitage. "Just as important is being able to face that you won't always know when that moment has arrived. Be prepared to make mistakes," he says, "because you'll make a lot of them. Armitage reckons that a good investor is right about 60% of the time."
John Armitage
Hedge fund manager, from "Hedge Hunters" by Katherine Burton, echoing the number that Stanley Druckenmiller and Steve Cohen use as their expected win percentage.

One of my friends refers to short-sellers as the "defacto enforcement division of the SEC". I wish the SEC enforcement division could take that on for itself.
David Einhorn
Hedge fund manager, from "Fooling Some of the People All of the Time", circa 2008

Over longer periods of time, cash has been demonstrably less safe because of persistent inflation. This is not to say cash cannot be a holding at certain junctures—the point is that it must be viewed as an asset which can be cheap or expensive at a given time. So, if you are tempted to sell a stock short, remember, you are buying cash. You are, in fact, going to the Fed, which is a monopolistic and costless producer of cash, and telling them, "I want your product. And I will give you this other asset for it."
Alex Gurevich
Hedge fund manager, from "The Trades of March 2020: A Shield Against Uncertainty"

The World Economic Forum is just an excuse for rich people to do body shots. There is not a lot of planning there. It's really not that impressive from an intellectual or planning perspective—it's just a party.
Peter Zeihan
Geopolitical Analyst

The truth is that investors in corporate securities are risk-takers making investments in risk capital. One risk is fraud. The best way to discourage fraud is to actually enforce the penalties for fraud. If investors believe that companies making false and misleading statements will be punished, they will be more sensitive to what is said. And because their money is at stake, investors will allocate capital mmore carefully. The sensitivity and other consequences will, in turn, deter dishonesty. In fact, i wonder if a few Allied shareholders [the company Einhorn was short] have held the stock on the cynical theory that even if Allied is every bit as bad as Greenlight thinks it is, the regulatory consequences won't be dire enough to hurt my investment. So far, that thinking has been spot on, and indeed, rewarded.
David Einhorn
Hedge fund manager, from "Fooling Some of the People All of the Time", circa 2008

0DTEs (zero days to expiry) option selling has made 1 to 2 standard deviation daily moves less likely, but has dramatically increased the chance of 3 to 4 standard deviation moves.
A.S.
Former hedge fund manager, sell-side trader, and one of the smartest guys I know.

If you want to maximize your real wealth, you need to have full employment. If you have less than full employment, you are losing your real wealth. Why would you want to pursue that? The losses from unemployment from one year, for probably just the U.S. and Europe, are larger than all the losses for all the wars in the history of the world put together, given today's productivity.
Warren Mosler
Former hedge fund manager

The loss of the money didn't bother me. Whenever I have lost money in the stock market I have always considered that I have learned something: that if I have lost money I have gained experience, so that the money really went for a tuition fee. A man has to have experience and he has to pay for it. But there was something that hurt a whole lot in that experience...and that was the loss of a great opportunity. The money a man loses is mothing; he can make it up. But opportunities such as I had then do not come every day.
Edwin Lefreve
from "Reminiscences of a Stock Operator"

I sometimes think that no price is too high for a speculator to pay to learn that which will keep him from getting the swelled head. A great many smashes by brilliant men can be traced directly to the swelled head—an expensive disease everywhere to everybody, but particularly in Wall Street.
Jesse Livermore
Trader

Any analyst or strategist with 'Dr.' as a pre-fix should be faded.
John Garrett
Portfolio manager and Adjunct Professor, MastersInvest.com

A price is a signal wrapped up in an incentive.
Alex Tabarrok
Bartley J. Madden Chair in Economics at the Mercatus Center and professor of economics at George Mason University

Theta is the rent on gamma. And while the rent feels too high right now, the renter doesn't pay for the plumbing problem. A leak in one part of the house can lead to all kinds of knock-on effects in other parts.
Dean Curnutt
Host of the Alpha Exchange

Everyone must choose one of two pains: The pain of discipline or the pain of regret.
Jim Rohn
American entrepreneur

It's the GAG age: the Golden Age of Grift.
Sam Rines and Tom Graff
Lifted from one of their chats. Hopefully, they don't mind me stealing it (with proper attribution, of course)

There are three ways to make a living in this business; be first, be smarter, or cheat. I don't cheat. And although I like to think we have some pretty smart people in this building, it sure is a hell of a lot easier to just be first. If you're the first out of the door, that's not called panicking.
John Tuld
CEO of Investment Bank in "Margin Call"

Central Banks buy gold, they don't buy gold stocks.
Rick Rule
Paraphrased from this gold mining portfolio manager

We're so shit at seeing the Macro, and ultimately it's those macro uncoupling dynamics that matter more than anything else.
Mark Blyth
Economics professor

In January of 2000, after riding that tech boom to a "T" and making billions of dollars in 1999, I sold everything out in January. I had a couple of internal portfolio managers at Soros that made 30% after I sold. And I just couldn't stand it anymore. I'm watching them make all this money every day. I am ready to pick up the phone and buy this stuff back. There's a little devil [on my shoulder] and a little anger—she's saying, "don’t do it" and he's saying, "buy it". I pick up the phone and I say, "buy 'em." I might have missed the top of the DotCom bubble by an hour. I ended up losing $3 billion on that trade alone. I made more the year before, but $3 billion is a lot of money [editor's note: no shit!] It was all because I got emotional and dropped every tool of discipline I ever had. Someone said, "What did you learn from it?" I said, "I learned nothing. I learned that 25 years ago." you can talk about not being emotional, but it takes incredible discipline to act on that.
Stanley Druckenmiller
The Greatest Investor of All Time

Tops are a process and bottoms are an event.
Doug Kass
PM at Seabreeze Partners

You need short-term paranoia to keep you alive long enough to exploit long-term optimism.
Morgan Housel
Investment author

I asked a Chinese investor, "Why did you buy that office building in Manhattan at a 4% yield?" "Cause we have enough of your treasuries."
Barry Sternlicht
CIO Hines

So, what you're telling me is that the music is about to stop, and we're going to be left holding the biggest bag of odorous excrement ever assembled in the history of capitalism. I'm here for one reason and one reason alone. I'm here to guess what the music might do a week, a month, a year from now. That's it. Nothing more. And standing here tonight, I'm afraid that I don't hear a thing. Just...silence.
John Tuld
CEO of Investment Bank in "Margin Call"

The first rule of trading—there are probably many first rules—is don't get caught in a situation in which you can lose a great deal of money for reasons you don't understand. Undertrade, undertrade, and undertrade is the second piece of advice. Whatever you think your position ought to be, cut it at least in half...novice traders trade 5 to 10 times too big. They are taking 5 to 10% risks on a trade they should be taking 1 to 2% risks. The market, of course, is totally impersonal. It doesn't care whether you make money or not. If you personalize losses, you can't trade.
Bruce Kovner
Probably one of the most underrated Market Wizards

For most investments, sizing is more important than entry level.
Harley Bassman
Founder of the MOVE Index

I have a tattoo on my back that reads, "NEVER SHORT MONOPOLIES"
Dennis DeBusschere
22V Research President and Chief Market Strategist

The period from 2008 to 2020 was a great time to be a borrower because interest rates came down and business was prosperous. Right now (and going into the future), leveraged companies will not be able to renew their leverage as easily and the cost will be higher. To put it in brief: six years ago, you had an idea, you went into the back and described it. They said, "Fine, we'll give you $900 million at 5%." Now it's tie to renew your debt, you go in and describe it again, and the bank says, "Good, we'll give you $500 million at 9%."
Howard Marks
Oaktree founder

Real world economic conditions are driven not by income or wealth strata, but by where an individual or corporation is positioned relative to that fiscal firehouse.
Rupert Mitchell
Author of the Blind Squirrel Macro, via Bob B. in the 'tourist chat

Ironically, Japan completely embraces conventional macro theory; the reason they are keeping interest rates down is that they are worried they might not actually be out of deflation. If Japan ever decided to raise interest rates, with their debt-t-GDP, they would be throwing gasoline on the fire, like the U. S. has, except twice as much.
Warren Mosler
Former hedge fund manager and founder of MMT, from the OddLots podcast

Let's say you're getting 70% off, is that enough? The mere fact that something is down doesn't make it a buy. It has to be that the price is down more than it should be given the fundamentals.
Howard Marks
Oaktree founder

The markets have been like a drunk stumbling across a highway. You watch an eighteen wheeler barrel down and clench your eyes shut, only to open them seconds later and find that he's still standing. Then it happens again. And again. And, to your utter surprise, you soon see that he's standing on the other side.
Andrew Beer
Portfolio manager and founder of DBMF ETF

People want a simple narrative, but the world doesn't give you that.
Jeffrey Gundlack
Founder of Double Line Capital, via Street Smarts by Market Lab

"Capitalism" is a dirty word for many intellectuals, but there are a number of studies showing that open economies and free trade are negatively correlated with genocide and war.
Steven Pinker
Professor of Psychology

When you're trading well, you have a better mental attitude. When you're trading poorly, you start wishing and hoping. Instead of getting into trades you think will work, you end up getting into trades you hope will work.
Randy McKay
Market Wizard

This business is not about investing in great companies; it's about profiting from inefficiently priced stocks.
Michael Lauer
Portfolio Manager

Successful investing requires a rare combination of just the right amount of arrogance and humility to imagine that you can see the future and the wherewithal to admit when you have made a mistake.
Howard Marks
Founder of Oak Tree, via Street Smarts at Market Lab

If most traders would learn to sit on their hands 50% of the time, they would make a lot more money. I don't think you can consistently be a winning trader if you're banking on being right more than 59% of the time. you have to figure out how to make money being right only 20 to 30% of the time.
Bill Lipschutz
Market Wizard

For most investors, the easiest edge to attain is a behavioural edge.
Warren Pies
Founder of 3Fourteen Research

The markets are the same now as they were five or ten years ago because they keep changing, just as they did then.
Ed Seykota
Market Wizard

Make good decisions even with incomplete information. You will never have all the information you need. What matters is what you do with the information you have.
Michael Steinhardt
Market Wizard hedge fund manager

I believe that good investors are successful not because of their IQ, but because they have an investing discipline.
Stanley Druckenmiller
Market Wizard hedge fund manager

The desire to maximize the number of winning trades (or minimize the number of losing trades) works against the trader. The success rate of trades is the least important performance statistic and may even be inversely related to performance.
William Eckhardt
Market Wizard hedge fund manager

The moral is that in trading it's important to examine the situation from as many angles as possible because your initial impulses are probably going to be wrong. There is never any money to be made in the obvious conclusions.
Jeff Yass
Co-founder of Susquehanna

You can be following your rules exactly and still lose money. In that situation, you certainly haven't performed poorly as a trader.
Howard Siedler
One of the original "Turtles"

You have to be willing to accept a certain level of risk, or else you will never pull the trigger. You cant be afraid to take a loss. The people who are successful in this business are the people who are willing to lose money.
Steve Watson
Portfolio manager at Capital Group

The purpose of trading is not being right, the purpose is to make money, and I think that's my number-one rule. Don't get hung up on your current positions.
Dana Allen
Trader

There are lines between investing and speculating and gambling, but I have no idea where they are.
Walter Deemer
Trader

You make most of your money in a bear market, you just don't realize it at the time.
Shelby Cullom Davis
via my pals at Incrementum

Trading silver is a tough way to make an easy living.
Rich Ross
Evercore Analyst, via Incrementum

At one point, his interviewer asked the question that is on all of our minds: "Should wise people have known better?" Of course, they should have, Buffet replied, but there's a "natural progression" to how good new ideas go wrong. He called this progression the "three I's." First come the innovators, who see opportunities that others don't. Then come the imitators, who copy what the innovators have done. And then come the idiots, whose avarice undoes the very innovations they are trying to use to get rich. The problem, in other words, isn't with innovation—it's with idiocy.
Warren Buffett
Quoted in the Harvard Business Review

[Always ask yourself], is the Fed easing or tightening because they can? Or because they have to?
Dean Curnutt
Host of the Alpha Exchange

I tell you, Grant, I think if there was one serious message to listeners, [it would be]: This is not supposed to be easy. And there's all sorts of people competing for your attention, there's all sorts of people peddling the most obviously awful misinformation, disinformation on a range of things. And the thing I neglected to mention in our conversation tonight is there is a direct connection, I think, between the tearing in the fabric of society and the tearing in the fabric of markets. All day, every day, we see these little micro tears that sometimes turn into big tears and arguments in society, and I'm seeing it every day in markets and it's not good.
James Aitken
from Grant Williams' podcast

When optimism turns to euphoria, the rate of change of the returns themselves can explode into a parabolic curve. Of course, such curves are unsustainable. The smug moment of being in the money is short-lived in the same way that a fund that buys a ton of stock going into the close usually gets a favorable mark on their daily p/l. Their sloppy buys drove the price higher in a short period of time. The real sellers didn't have time to react before the close. But as soon as they check the comps overnight, you can be sure the supply is coming tomorrow morning.
Kris Abdelmessih
founder of Moon Tower. Ai

Economics is too important to be left to economists.
Abhijit V .Banerjee
Economist

The three favorite "isms" on Wall Street are capitalism, cronyism, and nepotism. The first is noble, the second is hypocritical when juxtaposed against the first, and the third is just the way it is.
Brad Schaeffer
from "Life in the Pits: My Time as a Trader on the Rough-and-Tumble Exchange Floors"

The facts are unimportant! It's what they are perceived to be that determines the course of events.
R. Earl Hadady
from "Contrary Opinion: How to use it for profit in trading commodity futures"

Herd behaviour generates informational cascades: the information on which the first people base their decision will have an outsized influence on what all the others believe.
Abhijit V .Banerjee
Economist

Practical men who believe themselves to be quite exempt from any intellectual influence are usually the slaves of some defunct economist.
John Maynard Keynes
Economist

Rosenthal invested new ways to play arbitrage games in the merger-and-acquisition world, in dead, he was the father of the sort of "risk arbitrage" trading Ivan Boesky later made famous. And he was among the first to spot Boesky for what he was. Michael Zimmerman, who worked under Rosenthal, and later became head of Solly's merchant banking division, remembered Rosenthal telling him to fire anybody in his department who had dealings with Boesky. "He's got to be getting inside information," Rosenthal said, "because nobody is that much smarter than I am."
Martin Mayer
from "Nightmare on Wall Street. Solomon Brothers and the Corruption of the Marketplace"

"The way we made money was so simple that we couldn't speak about it. Anybody could do it. We were to silence," one former J. Aron partner confesses. J. Aron made most of its fortune from classic arbitrage, small but steadily profitable deals overlooked by others in the marketplace. London was the center of the gold market, and for a time J. Aron was the only New York dealer with a direct telex to London. This made J. Aron the only dealer in New York who always knew the price of gold, and the firm moved in and out of trading situations as the opportunities arose. When the price of silver rose, the firm booked smelting time at the available refineries and made profits simply by reselling the reservations, which because silver could only be sold in bars, had become almost as valuable as the metal itself. For a short time, J. Aron had one of the most profitable businesses on Wall Street.
Lisa Endlich
from "Goldman Sachs: The Culture of Success"

I was seldom able to see an opportunity until it had ceased to be one...
Mark Twain
who never would have made it on twitter because traders on there don't seem to ever lose or miss a move...

I don't bother to read most economists (particularly those who insist on being called Dr. Sam or Dr. Eric) and strategists because they only tell you about what has happened, not what will happen. They don't forecast; they just extrapolate recent trends into the future. They are mostly followers, who revise their forecasts of the future based on the direction of the latest economic numbers or what markets have done recently. As a result, they are always behind the curve instead of in front of it.
Barton Biggs
from "Hedge Hogging"

Question: Have the tremendous advances in computer technology...caused some previous inefficiencies to disappear and made new ones harder to find? David Shaw: The game is largely over for most of the "easy" effects. Maybe someday, someone will discover a simple effect that has eluded all of us, but it's been our experience that the most obvious and mathematically straightforward ideas you might think of have largely disappeared as potential trading opportunities.
Jack D. Schwager
Interviewing David Shaw, 2001, proving that even the smartest always thin the "easy" time for markets is behind us.

$15 million dollars a year with a 30 Sharpe, who cares? $15 billion a year with a 2 Sharpe, that's hard.
Giuseppe Paleologo
from the "Flirting with Models" podcast (Currently on garden leave, Gappy has previously worked in Risk and Quantitative Analytics at Citadel, as Head of Enterprise Risk at Millenium, and most recently as Head of Risk Management at HRT. ) BTW, I care about the $15 bucks with a 30 Sharpe...

One of the dangerous things is assuming whatever the current state of the world is today, will be the future state of the world. You don't have to go back terribly far to get to the financial meltdown in the late aughts where you saw trades between credit default swaps and underlying bond prices, which would normally move within two basis points, and you would fade the move if it got to five basis points, blow out to three hundred, four hundred, five hundred basis points. This was not a normal situation and it was entirely because too many people thought the tie between these two asset classes could not be broken.
Todd Simkin
Susquehanna Trader

As a market technician, I have spent the better part of my years studying the market, in search of accurate indicators and winning trading systems. It has been my job to provide traders both large and small with an edge. Yet, even I, the die-hard technician, know that a truly great trader is not successful because he or she has some special insight into the markets or has discovered the holy grail. Rather, what separates the greats from the merely mediocre are the intangibles—intelligence, drive, hard work. In essence, what makes traders like Charlie successful is not their system but their spirit—a largeness of mind and heart. And most important, a strong belief in themselves—call it self-confidence. For if you are not confident, the markets will take you out in a second and cause you to question your very existence. No system can overcome a lacking from within. This unassailable truth was brought home to me with Charlie.
Thomas Demark
Epilogue from "Charlie D.: the story of the legendary bond trader" by William Falloon

Sometimes you just need to know what ballpark you're playing in.
Tony Pasquariello
Goldman Sachs Trader, quoting one of his clients

By January 13, I had covered my short S&P futures position, but I was still short stock. On that day, I spoke to Paul Tudor Jones, who had just returned from participating in a roundtable discussion sponsored by Barron's. He told me that eight out of the eight participating money managers had said they were holding their highest cash position in ten years. I'll never forget that the S&P was near 310 and Paul said, "340 is a chip shot."
Stanley Druckenmiller
from "New Market Wizards"

Kovner was another academic who had been recruited by Commodities Corp. This former political science teacher at Harvard and the University of Pennsylvania had shifted his attention from academia to the financial markets back in the mid-seventies. Kovner believed that his knowledge of economics and political science would give him and edge in analyzing futures markets. He'd been right. In 1987 alone, Kovner scored profits in excess of $300 million for himself and fortunate investors like Commodities Corp. As Kovner rambled on about how he'd fallen in love with the yield curve and how his study of the markets coincided with the initial trading in interest rate futures, my mind began to wander...
Martin "Buzzy" Schwartz
from "Pit Bull: Lessons from Wall Street's Champion Trader"

What's the difference between bitcoin and gold? With bitcoin, governments confiscate it and sell it. With gold, governments buy it. Which do you want to own?
Trader B.B.
overheard on our desk...

...the dollar began the week trading at 135 yen in Tokyo and fell as low as 111.73 yen Thursday...Friday the currency bounced around in a four-yen range in Asia, finishing the sessions at 116.90 yen, down from 119.45 yen in New York late Thursday... it is widely believed that U.S. hedge funds sparked the dollar rout by rushing to unwind 'yen-carry' positions, through which they had borrowed yen at low-interest rates to invest in high-yielding assets denominated in other currencies.
Dow Jones News, Oct 9, 1998
from "Trading Catalysts" by Webb

"Never sell a dull market." I believe that this was intended for bull markets, for it appears just as dangerous to "buy a dull market"—during a bear market.
Humphry B. Neill
from "Tape Reading & Market Tactics

The uncertain nature of the economic future and our flawed attempts to understand it are a permanent source of market mispricing. The economy is not easily predictable, but the reactions of policy markets and the persistent errors in human expectations are.
Steve Drobny
from "The Invisible Hands: Top Hedge Fund Traders on Bubbles, Crashes, and Real Money"

The importance of psychology—your own psychology and that of other market participants—is underestimated by most institutional investors. And it is much more difficult to understand your own psychology than the market's psychology. It takes a much longer time to truly understand how you work, how you function psychologically in various environments, and how you manage this psychology and your risk as you monitor the markets.
Steve Drobny
from "The Invisible Hands: Top Hedge Fund Traders on Bubbles, Crashes, and Real Money"

Holding cash when markets are cheap is expensive, and holding cash when markets are expensive is cheap.
Steve Drobny
from "The Invisible Hands: Top Hedge Fund Traders on Bubbles, Crashes, and Real Money"

Valuation is my hedge.
David Tepper
one of the greatest risk takers that has ever lived...

Last summer, I was on CNBC talking up Potash, saying it was the best positioned company in the world when suddenly I realized everyone was agreeing with me. So, I got out. Thank God... We occupy a world where fundamentals are on one side and an emotional landscape of human psychology and behavior is on the other.
Steve Drobny
from "The Invisible Hands: Top Hedge Fund Traders on Bubbles, Crashes, and Real Money"

Question: What is the difference between a Peruvian peasant farmer and a Harvard or Yale endowment manager? Answer: The peasant is the one who understands risk-sensitive investing and sound investment goals.
Nouriel Roubini
from "The Invisible Hands: Top Hedge Fund Traders on Bubbles, Crashes, and Real Money"

In trying to get a sense of the future, you have to play games with yourself. A nice example of playfulness is Paul Tudor Jones overlaying the stock market of 1987 op top of 1929 and predicting the crash. And it worked. It was fortuitous that it worked, but it worked. He was lucky. In this business, being consistently lucky is fine—just stay lucky.
Steve Drobny
from "The Invisible Hands: Top Hedge Fund Traders on Bubbles, Crashes, and Real Money"

Don't be a hero. Don't have an ego. Always question yourself and your ability. Don't ever feel that you are very good. The second you do, you are dead.
Paul Tudor Jones
one of the greatest risk takers that has ever lived...

Just because someone knows more about investing than you, that doesn't mean they will be able to produce superior results. And, in fact, very often it works in the opposite direction. You can know too much. you can draw too heavily on previous experiences that are no longer applicable to the current market environment.
Josh Brown
the Reformed Broker

Short QQQs and lose...
Anonymous
overheard on the 'tourist's trading desk

When I see a bubble forming, I rush in to buy."
UPDATED FOR POST-COVID ENVIRONMENT:
When I see a cult-like CEO talk about chicken tendies or appear on SNL, I make that a top holding..."
George Soros
One of the greatest hedge fund managers

Trading is a psychological game. Most people think that they're playing against the market, but the market doesn't care. You're really playing against yourself. you have to stop trying to will things to happen in order to prove that you're right. Listen only to what the market is telling you now. Forget wheat you thought it was telling you five minutes ago. The sole objective of trading is not to prove you're right, but to hear the cash register ring.
Marty Schwartz
Trader

As long as you stick to your own style, you get the good and bad in your own approach. When you try to incorporate someone else's style, you often wind up with the worst of both styles. I've done that a lot.
Michael Marcus
Market Wizard

If you can't take a small loss, sooner or later you will take the mother of all losses.
Ed Seykota
Market Wizard

If security prices were really the result of the rational, dispassionate evaluation of data, presumably one piece of negative information would move the market down a little, and the next such piece would move it down a bit more, and so forth. But instead, we see that an optimistic market is capable of ignoring individual pieces of bad news until a critical mass of bad news builds up, at which time a tipping point is reached, the optimists surrender, and a rout begins. Rudiger Dornbusch's great quote about economics is highly applicable here: "...things take longer to happen than you think they will, and then they happen faster than you thought they could." Or, as my partner Sheldon Stone says, "The air goes out of the balloon much faster than it went in."
Howard Marks
h/t to Garen in the chat

The most interesting thing in finance is the thing that never moves...until it does.
Russell Napier
Economic historian

I would sometimes think that maybe I ought to stop trading because it was very painful to keep losing. In "Fiddler on the Roof", there is a scene where the lead looks up and talks to God. I would look up and say, 'Am I really that stupid?" And I seemed to hear a clear answer saying, 'No, you are not stupid. You just have to keep at it.
Michael Marcus
Market Wizard

Man conquers the world (markets) by conquering himself.
Source Unknown
Adapted from a Zeno of Citium quote by a wise trader somewhere

In trading, you have to become the house so where you bet small enough that when you go through a bad streak, you're not going to lose all your chips. But you have to bet big enough that it still matters.
Mark Fisher
One of the greatest energy traders

There are four kinds of bets. There are good bets, bad bets, bets that you win, and bets that you lose. Winning a bad bet can be the most dangerous outcomes of all because a success of that kind can encourage you to take more bad bets in the future, when the odds will be running against you. You can also lose a good bet no matter how sound the underlying proposition, but if you keep placing good bets, over time, the law of averages will be working for you.
Larry Hite
Market Wizard

William Goldman once wrote that in Hollywood, it was extremely difficult to predict the success of a movie. "The single most important fact, perhaps of the entire movie, is that 'nobody knows anything.'" I think Bill's line might also be applicable to Wall Street.
Kevin Muir
The MacroTourist

Financial history does not necessarily give us the right answers, but it gives us the right questions.
Russell Napier
Economic historian

In baseball, you can hit 40 home runs on a single-A-league team and never get paid a thing. But in a hedge fund, you get paid on your batting average. So you go to the worst league you can find, where there's the least competition.
Julian Robertson
One of the original hedge fund titans

When you're in a losing streak, your ability to properly assimilate and analyze information starts to become distorted because of the impairment of the confidence factor, which is a by-product of a losing streak. You have to work very hard to restore that confidence, and cutting back trading size helps achieve that goal.
Bill Lipschutz
Market Wizard

In sports betting, the astute gambler does not try to predict the outcome of a game. He is indifferent toward the winner of the match because he cannot simultaneously be a gambler and a fan. Success instead lives in "beating the spread" or choosing an "over/under" on the "line" set by the casino. Some of my worst calls as an investment strategist have been when I forgot this point and tried to bet on who wins the election. And some of my best calls have been when I bet against the bookie: the market.
Marko Papic
from "Geopolitical Alpha"

Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected.
George Soros
the OG hedge fund trader

If politicians did 10% of what they promised, there would be no need for heaven.
Lee Cooperman
one of the great hedge fund managers on CNBC

My good friend and mentor Edgar de Picciotto, Chairman of Union Bancaire Privee in Geneva, has passed away; he was 86. He pressed upon me the importance of understanding the macro environment. "Many people describe themselves as stock pickers," he would say, "but you have to consider the economic, social, and political context in which the stocks are being picked." He encouraged me to meet as many people of influence as I could. For him, networking never stopped. He would test his ideas on those he respected, and if he ran into a strong opposing opinion, he would reflect on it seriously and sometimes change his position. While he never lacked conviction about his ideas, he was open-minded and flexible. "Nobody owns the truth," he would tell me.
Byron Wien
Legendary Wall Street Strategist

The truth is that, while you can't quantify reward, you can quantify risk.
Larry Hite
Market Wizard

Finally, I don't simply look at the classical chart patters (head and shoulders, triangle, and so on) as independent formations. Rather, I tend to look for certain combinations of patters or, in other words, patterns within patterns within patterns. These more complex, multiple-pattern combinations can signal much higher probability trades.
Al Weiss
Market Wizard

Going against the herd is important, but hard to do.
Dawn Fitzpatrick
CIO of Soros Funds

The first rule of trading—there are probably many first rules—is don't get caught in a situation in which you can lose a great deal of money for reasons you don't understand.
Bruce Kovner
CIO of Caxton and Market Wizard

Everything, in retrospect, is obvious. But if everything were obvious, authors of histories of financial folly would be rich...
Michael Lewis
from "Panic"

A bubble is a stock that you didn't buy before it went up.
Josh Brown
the Reformed Broker

There is nothing better in finance than a true small-cap equity bull market.
Anonymous Hedge Fund Manager
and a guy who happens to trade so large, he has difficulty buying small-caps, but loves them nonetheless

While a consistent, viable strategy is clearly the main-stay of successful speculation, three additional traits are required: discipline, discipline, discipline.
Stanley Kroll
1970s commodities speculator

The trend in the market is a lot like the weather; it is what it is, and there's not much anyone can do to change it. Or, as Mark Twain once said, 'Everybody talks about the weather, but no one does anything about it.' So, if the weather looks like rain, you wear a raincoat or carry an umbrella, whether you like it or not. Similarly, if the trend of a market is down, you play it short, or aside; and if the trend is up, you play it long, or aside—because you can't change the basic trend direction of the market. You either go with the trend, or you suffer the probably losses in trying to buck the trend.
Stanley Kroll
1970s commodities trader

So this is what Julian felt like in 2000...
Anonymous Portfolio Manager
One of my buddies commenting on how similar the situation is to the late stages of the DotCom bubble when famed value investor Julian Robertson was forced to shut down his fund. Right before internet growth stocks collapsed and value stocks went on one of the greatest rips of all time.

The game taught me the game. And it didn't spare me [the] rod while teaching.
Ed Seykota
Market Wizard

I learned that I'm not a machine. I learned that I can't always make decisions purely on logic; that there's an emotional component to everything we do.
Michael Steinhardt
Market Wizard

The objective is to make money, not to be right.
Marty Schwartz
Market Wizard

The most important thing about trading is not the money you make, but the preservation of your capital.
Monroe Trout
Market Wizard

I've watched a lot of really smart people go out of business shorting tech [on the way up] and I've watched a lot of other really smart people go out of business staying long tech [on the way down].
Hedge Fund Manager
One of the wisest traders I have had the privilege of knowing...

And then at the end of the day, the most important thing is how good are you at risk control. Ninety-percent of any great trader is going to be the risk control.
Paul Tudor Jones
Market Wizard

I remember being on the trading floor in the early 2000s, looking at my trading statements. I would see periods where I traded great, followed by times where I couldn't even sniff a winner. I couldn't understand how I could be so good, then so bad. Eventually, I learned about the subtle changes in market environments and their impact on my strategy. I started asking myself: Is it me, my strategy, or the market environment? If it was me or the market environment, I came up with a line that I wrote on a blank trading card: "Know when to be big, small, or not at all." It helped me mentally accept being small or not at all in non-conducive market conditions. This was especially useful on Fed days, election days, or big data days—none of which were environments where I ever did extremely well. In fact, I usually did extremely poorly. This week is for being small or not at all.
Anthony Crudele
Chicago Pit Trader

Having taken down hundreds of observations in my mind, I found myself testing their accuracy, comparing the behaviour of stocks today with other days'. From which he concluded: 'Speculation is as old as the hills. Whatever happened in the stock market today has happened before and will happen again'.
Tom Rubython
from "Jess Livermore: Boy Plunger", via inspiration from Paulo Macro

What the wise do in the beginning, fools do in the end.
Warren Buffett
A guy who knows a thing or two about investing (but is still getting lectured by Michael Saylor)

Twitter makes me dislike people I like, and podcasts make me like people I dislike.
Ezra Klein
NY Times journalist/political analyst

There should be ho haste. The market will be there tomorrow in case today's opportunities do not meet requirements.
Richard Wyckoff
Trader