Essential Investment Books - What I Learned Losing a MILLIONDollars

This book by Jim Paul and Brendan Moynihan is a book any tradershould read - The book correctly states that there are lots ofdifferent ways to make money and only a few ways to lose it.Therefore you need to concentrate on not losing first If you have not read this book you will see the markets in acompletely different light and one that could lead you to biggerprofits and is simply one of the best investment books everwrittten. What I Learned Losing a Million Dollars is a fascinating,insightful, easy-to-read true story of Jim Paul's rise from ahumble country background to jet-setting millionaire trader andGovernor of the Chicago Mercantile Exchange. It is an examination of the lessons he learned from losing amillion dollars in the market which brought about his demise andthen covers his rise from the ashes. This book contains no technical theories and really focuses onhow NOT To lose money - there are plenty of ways to make moneyso how come most traders lose it? The answer lies as we have stated that: It's not how you make money that's important there are many waysto do that, but are only a few ways to lose it and if you aremindful of them and don't make losing mistakes - you can emergea winner. The book is essentially divided into two parts: Section 1 The first half of the book about Jim's life makes you feel closeto him and the experience he is facing as his world crashesaround him. It's both funny and sad in equal measure and is asuperb fiction story. Section 2 After the loss and its aftermath, comes the authors views ofwhat he had learned and this really is original, thoughtprovoking and insightful. The authors show you how to identifyand manage the risks, both monetary and emotional that is partof any decision making including trading. Playing great defense The authors covers the key areas ALL losing traders fail in,that let losses get out of control. Key areas covered are: - The three biggest mistakes traders make and how to avoidthem. - Why the most important part of building wealth is not losingit. - The psychological pattern which all losses take in a tradershead, regardless of the position size The discussion on the risk/reward ratio, and why most otherbooks get it wrong is perhaps the most interesting part of thebook. This point is worth the books price alone as the aothor explains Why you have to take into account the PROBABILITY of return, andPROBABILITY of loss, when trading and not simply divide the sizeof your expected return by the size of your expected loss, asmost authors suggest - if you do you will lose! This really is the key point of the book if you want to keeplosses under control as it states in the preface. "This book is a case study of the classic tale of countlessentrepreneurs: the risk taker who sees an opportunity, the ideathat clicks the intoxicating growth, the errors and thecollapse. Our case is that of a trader, but as with all casestudies and parables the lessons can be applied to a great manyother situations. If you want a book to show you the importance of emotionaldiscipline and the art of risk management, then this is it. This book has recently gone out of print, so get your hands on asecond hand copy or get to the library and read it.