Little Book of Trading (eBook)

MICHAEL W. COVEL serves as President of Trend Following¯(TM) (www.trendfollowing.com), a privately owned research firm. His first book is Trend Following: Learn to Make Millions in Up or Down Markets, and his second is The Complete TurtleTrader. He also founded TurtleTrader.com¯® in 1996, and since then, it has grown into an internationally recognized archive of trading information and data visited by over 10 million users. His first documentary film--Broke: The New American Dream, about the 2007-2009 crash--was released in 2009 and premiered on The Documentary Channel.

Introduction: A Wake-Up Call xiii

Foreword xxiii
Cole Wilcox

Foreword xxxiii
Cullen O. Roche

Chapter One Stick to Your Knitting 1
Gary Davis, Jack Forrest, and Rick Slaughter

Chapter Two Someone's Gotta Lose for You to Win 21
David Druz

Chapter Three No Guts, No Glory 37
Paul Mulvaney

Chapter Four In a Land Far, Far Away from Wall Street 53
Kevin Bruce

Chapter Five Think Like a Poker Player and Play the Odds 65
Larry Hite

Chapter Six Stand Up, Dust Yourself Off, and Keep Going 83
David Harding

Chapter Seven Throw Away the Fundamentals and Stick to Your Charts 103
Bernard Drury

Chapter Eight Study Hard and Get an A+ 117
Justin Vandergrift

Chapter Nine You Can't Know Everything 131
Eric Crittenden and Cole Wilcox

Chapter Ten Make It Work Across All Markets 147
Michael Clarke

Chapter Eleven Stay in the Moment of Right Now 163
Charles Faulkner

Chapter Twelve Sing the Whipsaw Song 181

Appendix A: Getting Technical: What is Capitalism Distribution? 187

Appendix B: Fund Performance Data 193

Glossary of Key Terms 201

Author Disclaimer 207

Acknowledgments 209

"The Little Book of Trading reveals the secrets from
trend-following insiders giving you the freedom to trade all
markets: interest rates, copper, currencies, stocks -- you name it!
Covel encourages you to take that TV blaring CNBC and throw it
right out the window. Charts cut the noise."

--Addison Wiggin, Best-selling author ofDemise of the
Dollar; Executive Publisher, Agora Financial, LLC

"In The Little Book of Trading, Michael Covel has
collected many gems of wisdom from some of the great traders of our
time. After reading this book and piecing together all of the
commonalities therein, you'll begin to understand what it
takes to be successful in the markets. Ignore these key truths and
one day you'll watch your account disappear."

--Van K. Tharp, Ph.D., President, The Van Tharp Institute.

"Michael Covel's unique insight into trading is
invaluable. Both novice and experienced traders can benefit from
Michael's thorough knowledge of markets around the
globe. The Little Book of Trading is a must read for serious
investors."

--Louis G. Navellier, Chairman and Founder, Navellier &
Associates, Inc.

"Imagine being in the circle of trust of some of the
greatest traders of all time, knowing what made them successful and
having them share heartfelt advice. Though the eyes of Michael
Covel in The Little Book of Trading, you will truly feel
this experience."

--Murray A. Ruggiero Jr., Contributing Editor, Futures
Magazine; VP Research and Development, TradersStudio Inc.

"Michael Covel's Little Book of Trading is a
must-read guide to help you succeed in the shark-infested waters of
the investment world."

--From the Forward, Cullen O. Roche, Founder and CEO, Orsus
Investments, LLC; Proprietor of Pragmatic Capitalism

"The latest addition to the 'little book big
profits' series, Michael W. Covel's The Little Book
of Trading: Trend Following Strategy for Big Winnings looks at
the financial world through the eyes of successful trend traders
... What Covel stresses throughout the book are the
accompanying principles that make trend following viable: stick to
your plan and manage your risk through diversification, stop
placement, and position sizing. These are important principles for
any kind of trading, but for trend following they are critical
... Successful trend following traders try to capture the
outliers, the really big moves that more than compensate for the
many small losses they take. This goal requires traders to have
confidence in their systems and confidence in themselves. By
introducing the reader to successful trend traders, Covel believes
that some of their 'magic' just might rub
off."

--Seeking Alpha