Best Trading Psychology Books for All Trading Styles and Markets

Best Trading Psychology Books for All Trading Styles and Markets

This is a book written by Benjamin Graham and was published in 1949. Mr. Graham was a stock analyst and his book helps us understanding his mind set and methodology in the process of stock selection. As a mark of appreciation for this book, none other than Warren Buffet claims this book is the best to be ever written. As the name suggests this book has inspired people all over the globe and is the finest in terms of how to develop your psychological mindset to be a trader.

If the profit target is hit, they take the money and run, and if losing trades hit a predetermined limit, they fold up their tent and go home, preventing further losses and living to trade another day. There's an old saying on Wall Street that "pigs get slaughtered." This adage refers to greedy investors hanging on to winning positions too long, trying to get every last tick. Greed can be devastating to returns because a trader always runs the risk of getting whipsawed or blown out of a position. Understanding what motivates fear and greed can give you the discipline and objectivity needed to be a successful trader and take advantage of others' emotions. Trading as a Business— a book about developing a psychological attitude toward the trading, creating a trading strategy and following it, while treating trading as a business, by unknown author.

This trader profile is characterized by the trader’s tendency to be practical, decisive and realistic in their approach to trading. The Administrative Trader has a tendency to be responsive to changing market environments that can result in profitable trades. In addition to adapting to different market conditions, this type of trader has strong decision making capabilities and can delegate authority when working with others. Due to their fastidious attention to analysis and recordkeeping, these traders can sometimes fall into the trap of paying more attention to these activities than to making profitable trades.

Also, it makes sense to plan out and devote as much time as possible to the research process. The book does a great job of explaining individual and mass psychology of the markets, how prices are set, how human behaviour tends to create the same price-patterns over and over again.

This trading psychology book will reinforce that idea as it applies to not just trading, but risk-taking in general. It goes through a trader’s mind step-by-step, dealing with one problem at a time. This approach makes this trading psychology book highly practical.

The book also goes on to discuss the importance of emotions in trading and the devastating effect that fears and hopes can have on your trading performance. When the market goes against you, you hope that it will reverse which leads to even larger losses down the road. The book is a great read whether you’re a total beginner or a seasoned professional.

He covers how the top traders manage risk with exceptional skill while building emotional courage and stamina to survive the learning curve. He also goes in depth how they are trading price action and order flow, often in combination with fundamental analysis. Leon Wansleben is a sociologist by trade who also gets to spend time watching an entire FX trading desk. This is probably the longest forex trading book review of them all since I have personal experience with Mike, but his unique approach to trading also applies to the mindset. In The Playbook, he shares a lot about working with his trading team, getting them through the same obstacles we all experience.

Miracle of Discipline - mastering discipline is the key to success in forex trading, written by Rob Booker. The information contained in or provided from or through this site is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice. The information on this site and provided from or through this site is general in nature and is not specific to you the user or anyone else.

These traders tend to use their own interpretation of data and act independently of the crowd when trading. While their abilities to think outside the box can result in profitable trades, their lack of social skills makes them poor team players. This trader profile is characterized by a playful approach that includes a degree of social interaction when trading.

If you’re interested in how to become a trading star in your own right, Market Wizards by Jack D. Schwager does a great job in explaining the winning attitudes of some of the world’s greatest traders. According to Schwager, most traders fail because they chase trading without developing their own methodology. Almost their entire focus is on trade entry, completely neglecting the importance of trade exit and risk management. Schwager breaks all the responses down into a set of guiding rules that you can use in your daily trading. Some of the traders interviewed in the book include Bruce Kovner, Paul Tudor Jones, Ed Seykota, Marty Schwartz, and more.

The common problems most traders have encountered are revealed, followed by tactics and strategies to overcome those issues. Written by Rolf Dobelli, this book presents its content in a concise manner across 99 chapters, each only two to three pages long. The chapters provide examples of psychological pitfalls everyone, not just traders, can fall into. This book tackles problems many traders are aware of yet seem powerless to prevent. It includes why it can be so hard to get out of a losing tradeand even why people stay in personal relationships even when it is not healthy for them.

This includes addressing personal inclinations to seek short-cuts, being easily swayed by fear or greed, and getting distracted. These traits often cause traders to act irrationally even when they know better.

No matter if you are already seeing positive results, doing poorly, or just starting your trading journey, this book has something for everyone. This book follows the trading career of a life-long trader, providing insight into struggles you may have faced already, or have yet to encounter. While it is a trading book, the material does not provide strategies on how to trade.

The most interesting part of this book is the fact that it sheds limelight on the life of Jessy Livermore, who is regarded as one of the most successful traders in the equity markets. The book also contains some historic and morale boosting quotes that can help us peep into Great Minds and how they managed to overcome losses to make millions in return. It’s much easier to read than Douglas’s other trading psychology book called ‘The Disciplined Trader’ (which required every ounce of my own vast reserves of discipline to finish). It’s got a heap of practical ways to make a deep impact on your trading, wrapped up in stories that held my interest.

No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. Testimonials appearing may not be representative of other clients or customers and is not a guarantee of future performance or success. If you've already read the books on the list above, and you still aren't reaching your goals, then this next list might help. If you are just getting started with meditation, this is one of the best books to read.

Listening to books on your way to work is a great way to leverage your time by doing two things at once. So if you want to succeed in trading, spend more time on psychology and less on strategies. There are only two components to successful trading, strategies and psychology.