Why We Love Lefevre’s Novel On Legendary Stock Market Speculator’s Life
Have you ever seen or heard about the name Jesse Livermore? He is not just some ordinary American professional. He is the legendary stock market speculator who pioneered day trading. He was born on July 26, 1877 in Shrewsbury, Massachusetts and he had led a magnificent career in stock trading during his time.
At his highest point back in 1929, Livermore was worth $100 million, which is equivalent to around $1.5 billion in today’s dollar. Because of his unforgettable speculations in the stock market and his effective strategies on stock trading, Livermore became the centerpiece of Edwin Lefevre’s 1923 novel “Reminiscences of a Stock Operator”.
The book just turned ninety-eight years old this year and I must say that it is one of those materials that stays relevant for generations. If you are interested in day trading, or if you are new to stock trading, or if you have been trading for years now, Lefevre’s classic novel based on Livermore’s life will definitely teach and inspire you to work harder and aim higher.
Having read the best-selling novel, I can attest to why it has been praised by thousands and why it remains to be one of the most important trading books in history. Here are five reasons why I love the book:
1) It is a well-written masterpiece that you’ll read from cover to cover
Edwin Lefevre, an American journalist, statesman, writer, stockbroker, and independent investor, did an excellent A+ job in writing “Reminiscences of a Stock Operator”. It’s the kind of book that you’ll read from end to end. Available on Amazon for $26.99 for hard cover, and $6.50 for paper back, this masterpiece is a bang for your buck.
If you’re interested in trying your wits in stock trading, this book is a perfect addition to your study. It’s available on Amazon here.
2) The book is timeless
It was originally written back in 1923 — that is ninety-eight years ago. And still, this book is a classic that have stood the test of time. Even though it’s based on the life of Jesse Livermore, who lived during 1870s to 1940s, the learnings from this book are timeless, relevant, and applicable to modern day stock trading.
This is the reason why traders of today still quote Livermore and still mention Lefevre whenever they talk about stock trading, stock market, power of the trend, and day trading. I can presume that fifty or a hundred years later, this novel will still be as significant as it is today.
3) It’s not just about stock trading, it’s also about life
If you have read Jack Schwager’s book “Market Wizards”, another best-selling must-have book on trading (that I highly recommend as well), all the investors and traders featured in the book mentioned Lefevre’s book and Livermore’s legendary story. They all have something great to say about “Reminiscences of a Stock Operator”.
But for me, as someone relatively new to trading and investing, I have read the novel twice or thrice and in those times, it has taught me new and different lessons. I realize that the book has the ability to teach its readers something new every time it is opened and read. Why? It is because the book is not just merely about stock trading — it is also about life.
The knowledge and wisdom that the book imparts are applicable in day-to-day life. The virtues of patience, discipline, and hard work are not only relevant to stock trading but to real life as well.
4) It contains priceless insights, teachings, and lessons
Here are some of the lessons that I learned from reading the book:
a) Do not just think, but sit tight too
In the book, it is emphasized that thinking and “using your brain” is good when you do stock trading and stock market speculation. However, it is not merely the thinking that will bring in the big money. What would it be then? It is the sitting — the sitting tight.
What does it mean when you have to “sit tight”? It means that you have to be patient, especially in waiting, observing, and scrutinizing. The book said that people who can do thinking right and sitting tight are hard to come by. It is one of the hardest things to learn. But once you get the reins to it, this combo will surely be your vehicle to success.
To sum it up, people who lose money are not beaten by the market, they are beaten by their ignorance and impatience.
b) Capitalize on experience
According to the book, speculation is as old as tradition. What happened before will happen again, so there is really nothing new in Wall Street. This means that being successful in stock trading and stock market speculation is a fruit of capitalizing on experience.
c) Learn from your mistakes
If you lose money this time, accept it and learn from it. It is important to learn from your mistakes so that in the future, you will not be committing the mistake of doing the same mistake again.
d) Discover the right side
The book says that there is only one side to the stock market — the right side. It’s not the bull side or the bear side. Discovering, understanding, and banking on the right side will help every trader in their craft.
e) Learn to guess right or hypothesize
It is wrong to just guess which stock will go up, when it will go up, or when it will go down. The right thing to do is to guess right or hypothesize. If you learn to guess right, you develop your brain power. You observe, study, scrutinize, and improve. You will learn to take into consideration all the things that you have to do in order to guess right.
5) The book will not only increase your knowledge, but it will also inspire your soul.
You will feel happy and inspired while reading it and after you have read it. It’s not just for the brain, but it’s for the soul, too. As I have mentioned above, its teachings are not just about stock trading, it is also about life in reality. Therefore, it’s the kind of book that is worthy to read, understand, and share with others.
If there is one thing that I’m not a fan of about the book is this: it has 400+ pages. All I’m thinking is this book could be very challenging to read and accomplish, especially for the younger generations. But, that’s it.
Whether you’re young or seasoned, if you are willing to improve yourself by learning from the legend, then this novel should definitely be on your trading bucket list this year.