Entries and Exits: Visits to Sixteen Trading Rooms
By Alexander Elder
John Wiley & Sons Inc.
112 pages, $40
It’s an occupational hazard: traders can’t get away from their work. Dr. Alexander Elder was climbing the walls after a few days on his Caribbean vacation. He correctly figured other traders were similarly inclined, so he began organizing a series of Trader’s Camp getaways in exotic locations.
Entries and Exits: Visits to Sixteen Trading Rooms is the result. The profiles span a wide array of trader types and styles: men and women with huge and not-so-huge accounts, mechanical and discretionary, swing and momentum, contrary opinion, “base building” and some techniques you probably haven’t heard of, covering the full stock-futures-options gamut. Each chapter supplies biographical background and two actual trades the individuals had placed with an explanation of the rationale behind the trades. Some panned out and others didn’t. Part of the fun of the book is studying the setup and then guessing the outcome.
The interviewees and the author then analyze the trades. This may be the one minor weakness of the book. I was occasionally confused about whose words I was reading. But the insights are profound and refreshingly candid. Not all of the participants were at the top of their game at the time of the writing. One man walked us through a series of trades that demonstrated how out-of-control he was. The shock of recognition will probably be palpable to most of us.
It’s to the author’s credit that he pointedly challenges the subjects whenever they appear to be in violation of their principles. Granted, that’s subjective, but it’s nice to see the author is unwilling to throw softballs even to friends.
I may have enjoyed such human-side overviews as much as the informative passages. It’s all a seamless interrelationship anyway. Russians refer to bad ticks as “boogers.” Add that to the bodily function list that includes “puking out” a bad trade. Another trader downloaded Gordon Gecko’s “money never sleeps” sound clip into his alarm clock. Clearly, he doesn’t want to get away from his work either. As the author observes, “Everyone loves the rewards, but do you love research, studying the markets, testing ideas, placing orders? A successful trader loves the process of trading and the rewards flow in pretty much as an afterthought.”
In short, the book is a worthy conclusion to the trilogy that began with Trading for a Living and continued with Come into My Trading Room.
Art Collins is an active, long-time trader. He is the author of When Supertraders Meet Kryptonite and more recently, Market Beaters. E-mail: firstname.lastname@example.org.