In today’s episode, Kim Ann Curtin interviews trading legend Victor Niederhoffer. Though he’s modest in saying he’s “only” traded for 55 years, he’s actually enjoyed quite a storied career.
An informed trader is a smart trader! At the SteadyTrade Podcast, we like to feature traders and financial figures from all sorts of backgrounds. It’s a fantastic way to increase your knowledge and examine trading from a variety of different angles.
Among Victor’s professional highlights? Hedge fund manager, bestselling author and statistician, and (naturally!) champion squash player.
You won’t want to miss what this long-time trader has to say!
An Education Through Books
Kim figures they can kick off the conversation by talking about Ayn Rand’s “The Fountainhead,” which she’s currently reading for the next installment of the SteadyTrade Book Club. (Follow the adventure and weigh in on social media with #SteadyTradeBooks).
Victor disagrees with co-host Tim Bohen’s stance that every trader should read the book right away. He thinks “Atlas Shrugged” is a better choice. He explains how it offers a great lesson about American business enterprise and how this mirrors the stock market.
But that’s not the only book he suggests reading. Victor’s got a long reading list for traders, starting with “Triumph of the Optimists” by Elroy Dimson, Paul Marsh and Mike Staunton.
This book shows an optimistic view of the stock market. Learn how “by investing in the stock market you’re participating in the enterprise system” and taking advantage of the collective know-how of corporations.
According to Victor, this book is not just an inspiring read … It’s possibly “the most important book written about the stock market” and a “good antidote to all the baloney” out there!
Victor has a TON more books to suggest — check out his full reading list here.
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Was Jesse Livermore a Hero?
Jesse Livermore (featured in an earlier podcast) is considered the first day trader and the father of short selling. He was active in the late 1800s through the 1900s and pioneered a lot of trading techniques that are still popular today. But is he really a good role model?
This is controversial: Victor doesn’t think so!
In the interview, he explains how his own bestselling book has been likened to the bestselling book “Reminiscences of a Stock Operator,” by Edwin Lefèvre about Livermore. Learn why Victor despises this comparison, and why he thinks Livermore’s work is a “lesson in failure!”
He also cautions that traders should avoid walking directly by the site of Livermore’s suicide on 62nd street in New York — the very first SteadyTrade ghost story.
Advice for Day Traders
Does Victor have advice for new traders? You bet your bottom dollar he does.
Learn why he has a different take than many traders, and why he cautions, “Don’t go for small profits!”
Among his other can’t-miss tips? Avoid too much turnover during the day … He explains why he always prefers to take a position and hold until the end of the day or until the next open!
Victor also dishes on his take on what might happen in the next six months … Tune in for his predictions, including why the “theory of ever-changing cycles” is a key approach. Traders might consider embracing this strategy, especially in these times of uncertainty.
What’s More Important Than Emotions?
According to Victor, certain things ARE more important than emotions in trading.
For him, it’s all about the quantitative things. As a trader, it’s your duty to avoid getting into “a position where you’ll be forced out because you’re in over your head.”
Victor talks about how traders need to use tested methods that they’ve created themselves. He even talks about some of his own patterns. He’s developed a system where he can have a different approach on different days of the week and work on a rotation.
Got a Question?
Victor had a lot to say in this episode … Has it gotten you thinking? Let us know what’s on your mind!
Remember: if your question is chosen as an on-air topic, you could win a SteadyTrade mystery gift box. Leave a comment below or on YouTube!
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