REMINISCENCES OF A STOCK OPERATOR

by Edwin Lefèvre

I cannot expect to play certainties only. I must reckon on probabilitie...

Experiences had taught me to beware of buying a stock that refuses to follow the group-leader.

I don't look out for the breaks; I look out for the warnings. I didn't know what was the trouble with Chester; neither did I follow a hunch. I merely knew that something must be wrong.

I didn't have to know why the insiders did not think enough of their own stock to buy it on the decline. It was enough that their market plans plainly did not include further manipulation for the rise. That made it a cinch to sell the stock short.

to emphasise how important the study of group-behaviourism is and how its lessons are disregarded by inadequately equipped traders, big and little. And it is not only in the stock market that the tape warns you. It

With me to feel that I am wrong and to decide to get out are practically one process.

Why do the room traders, who have suffered so often from the loaded dice of the insiders, continue to go up against the game? Well, for one thing they like action

What is abnormal is seldom a desirable factor in a trader's calculations

A speculator must have faith in himself and in his judgment.

courage in a speculator is merely confidence to act on the decision of his mind.

I can only rise by knowledge. If I fall it must be by my own blunders.

I wasn't thinking of covering at the bottom. I was intent on turning my paper profits into cash without losing much of the profit in the changing.

The frequent rallies, even when I knew as well as anybody that they were due, could not frighten me. I knew I'd do much better in the end by staying pat than by trying to cover to put out a new short line at a higher price. By sticking to the position that I felt was right I made over a million dollars.

I was not indebted to hunches or to skilful tape reading or to stubborn courage. It was a dividend declared by my faith in my judgment and not by my cleverness or by my vanity. Knowledge is power and power need not fear lies not even when the tape prints them. The retraction follows pretty quickly.

there is profit in studying the human factors the ease with which human beings believe what it pleases them to believe; and how they allow themselves - indeed, urge themselves -to be influenced by their cupidity or by the dollar-cost of the average man's carelessness.

Fear and hope remain the same; therefore the study of the psychology of speculators is as valuable as it ever was. Weapons change, but strategy remains strategy,

Thomas F. Woodlock when he declared: "The principles of successful stock speculation are based on the supposition that people will continue in the future to make the mistakes that they have made in the past."

In booms, which is when the public is in the market in the greatest numbers, there is never any need of subtlety, so there is no sense of wasting time discussing either manipulation or speculation during such times; it would be like trying to find the difference in raindrops that are falling synchronously on the same roof across the street.

The sucker has always tried to get something for nothing, and the appeal in all booms is always frankly to the gambling instinct aroused by cupidi...

People who look for easy money invariably pay for the privilege of proving conclusively that it cannot ...

he had an amazing knack for adapting himself to new conditions, and that is valu-able in a trader.

He early saw that the big money was in owning the railroads instead of rigging their securities on the floor of the Stock Exchange. He utilised the stock market of course. But I suspect it was because that was the quickest and easiest way to quick and easy money and he needed many millions,

Vision without money means heartaches; with money, it means achievement; and that means power; and that means money; and that means achievement; and so on, over and over and over.

his tactical moves were directed by his needs and by the minor currents that changed from day to day. In the stock market, as in warfare, it is well to keep in mind the difference between strategy and tactics.

That he did not argue with the tape is plain. He was utterly fearless but never reckless. He could and did turn in a twinkling, if he found he was wrong.

A manipulator to-day, for instance, has not only to make a stock look strong but also to make it be strong. Manipulation therefore must be based on sound trading principles. That is what made Keene such a marvelous manipulator; he was a consummate trader to begin with.

There is little question that a manipulator necessarily seeks his buyers among speculators. He turns to men who are looking for big returns on their capital and are therefore willing to run a greater than normal business risk. I can't have much sympathy for the man who, knowing this, nevertheless blames others for his own failure to make easy money.

Stocks are manipulated to the highest point possible and then sold to the public on the way down.

when the price line of least resistance is established I follow it, not because I am manipulating that particular stock at that particular moment but because I am a stock operator at all times.

Don't argue with the tape. Do not seek to lure the profit back. Quit while the quitting is good and cheap.

The chap who is compelled to lug a corpse a year or two always loses more than the original cost of the deceased; he is sure to find himself tied up with it when some really good things come his way.

I keep on harping on the fact that I never argue with the tape or lose my temper at the market because of its behaviour.

the wisdom of playing the game dispassionately.

That is why those outsiders who are wise enough not to buy at the top make up for it by not taking profits. The big money in booms is always made first by the public on paper. And it remains on paper.

General wisdom is less valuable than specific savvy.

All I considered was what should, could or might help or hinder me in that task.

nothing succeeds like success.

on general principles it is just as well to provide for any and all contingencies. It's plain sense.

Getting angry doesn't get a man anywhere. More than once it has been borne in on me that a speculator who loses his temper is a goner.

Speculation in stocks will never disappear. It isn't desirable that it should. It cannot be checked by warnings as to its dangers. You cannot prevent people from guessing wrong no matter how able or how experienced they may be. Carefully laid plans will miscarry because the unexpected and even the unexpectable will happen.