Top-5 Books About Trading: What Can They Teach You?
Each business can offer a list of the most relevant, useful, and interesting literature. Trading is not an exception, but 95% of books, unfortunately, lose their relevance very quickly. This is due to the fact that markets are constantly evolving and changing. Although the laws of price movement remain unchanged, books do not offer effective solutions. So, traders require some innovative views. We decided to list the most useful books about trading that will help shape your mindset right.
“One Good Trade” by Mike Bellafiore
The author describes the everyday life of traders:
- how the decisions are made;
- what problems traders experience;
- what actions lead to positive results.
The main focus is on the principles of effective money management. The author is trying to ensure the reader that the result of your trading day/week/month doesn’t matter because you need to strive for one good trade (which should cover small losing trades) and increase your capital.
“Fooled by Randomness” by Nassim Taleb
Much in the world happens by chance. Financial markets are a great example of it. The book does not contain any practical methods – it describes the principles of psychological behavior in a particular situation. The author gives examples when people gain excessive self-confidence, achieving some success in the financial markets. This is a trap, which subsequently leads these people to huge losses, crossing out all their past achievements.
“Principles” by Ray Dalio
Ray is called Steve Jobs in the world of trading – an extraordinary approach to business, an effective team, and basic principles – all this is described in detail in the book. After reading it, you ensure that financial markets are complex mechanisms where you cannot survive in the long term without knowledge, observation, practice, and experience.
“Think Slowly, Decide Quickly” by Daniel Kahneman
Nobel Laureate in Economics Daniel Kahneman is considered one of the main founders of behavioral finance. He begins by describing systems of thought – a quick one and a slow one. This is a very useful book for those who want to understand why they act in certain situations in a certain way and not vice versa.
“More Than You Know” by Michael Mauboussin
Michael Mauboussin is another great person in the financial markets. The book continues the ideas of Daniel Kahneman. It reveals both the psychological aspects of investing and the practical ones. It will be an excellent reading to learn the financial markets from an in-depth side.
Books on trading continue to be published and delight readers. These readings will not teach you how to earn money, but they will form the reader’s financial literacy, as well as an up-to-date view on the trading.