Details

The Laws of Trading


The Laws of Trading

A Trader's Guide to Better Decision-Making for Everyone
1. Aufl.

von: Agustin Lebron

20,99 €

Verlag: Wiley
Format: PDF
Veröffentl.: 12.06.2019
ISBN/EAN: 9781119574194
Sprache: englisch
Anzahl Seiten: 304

DRM-geschütztes eBook, Sie benötigen z.B. Adobe Digital Editions und eine Adobe ID zum Lesen.

Beschreibungen

<p><b>Every decision is a trade. Learn to think about the ones you should do — and the ones you shouldn’t.</b></p> <p>Trading books generally break down into two categories: the ones which claim to teach you how to make money trading, and the memoir-style books recounting scandals and bad behavior. But the former don't have profitable trades to teach; if they did they'd keep those trades to themselves. And the latter are frequently entertaining, but they don't leave you with much you can apply in your own life. <i>The Laws of Trading</i> is different.</p> <p>All of our relationships and decisions involve trading at some level. This is a book about decision-making through the lens of a professional prop trader. For years, behavioral and cognitive scientists have shown us how human decision-making is flawed and biased. But how do you learn to avoid these problems in day-to-day decisions where you have to react in real-time? What are the important things to think about and to act on? The world needs a book by a prop trader who has lived, breathed and taught trading for a living, drawing upon years of insights on the trading floor in real markets, good and bad, whether going sideways, crashing, or bubbling over. If you can master the decision-making skills needed to profitably trade in modern markets, you can master decision-making in all walks of life. This book will teach you exactly those skills.</p> <ul> <li>Introduces, develops, and applies one law per chapter, making it easy not only to remember useful concepts, but also to have them at the ready in any situation.</li> <li>Shows you how to find and think about the “special edge” of your organization, and yourself.</li> <li>Teaches you how to handle the interaction of people with artificially intelligent (AI) machines that make decisions, a skill that is rapidly becoming essential in the AI-driven economy of the future.</li> <li>Includes a "bonus" digital ancillary, an Excel spreadsheet with various worked examples that expand on the scenarios described in the book.</li> </ul> <p>Do you need to make rational decisions in a competitive environment? Almost everyone does. This book will teach you the tools that let you do your job better. </p>
<p>Acknowledgments vii</p> <p>Foreword ix<br /><i>Aaron Brown</i></p> <p>Introduction xiii</p> <p><b>Chapter 1 Motivation 1</b></p> <p>Know why you are doing a trade before you trade 1</p> <p><b>Chapter 2 Adverse Selection 21</b></p> <p>You’re never happy with the amount you traded 22</p> <p><b>Chapter 3 Risk 41</b></p> <p>Take only the risks you’re being paid to take Hedge the others 41</p> <p><b>Chapter 4 Liquidity 71</b></p> <p>Put on a risk using the most liquid instrument for that risk 72</p> <p><b>Chapter 5 Edge 93</b></p> <p>If you can’t explain your edge in five minutes, you don’t have a very good one 95</p> <p><b>Chapter 6 Models 115</b></p> <p>The model expresses the edge 115</p> <p><b>Chapter 7 Costs and Capacity 141</b></p> <p>If you think your costs are negligible relative to your edge, you’re wrong about at least one of them 142</p> <p><b>Chapter 8 Possibility 167</b></p> <p>Just because something has never happened doesn’t mean it can’t 171</p> <p><b>Chapter 9 Alignment 197</b></p> <p>Working to align everyone’s interests is time well spent 198</p> <p><b>Chapter 10 Technology 217</b></p> <p>If you don’t master technology and data, you’re losing to someone who does 220</p> <p><b>Chapter 11 Adaptation 239</b></p> <p>If you’re not getting better, you’re getting worse 240</p> <p>Notes 261</p> <p>Index 271</p>
<p><b>AGUSTIN LEBRON</b> began his career as a trader and researcher at Jane Street Capital, one of the largest market-making firms in the world. Over the years he traded many kinds of securities: equities, futures, commodities, options, and an assortment of other derivatives, and has created, developed and implemented several successful trading strategies. He currently runs the consulting firm Essilen Research, where he is dedicated to helping clients integrate modern decision-making approaches in their business.
<p><b>Praise for THE LAWS OF TRADING</b> <p>"A fun and fascinating guide to the world of trading, ranging effortlessly from the fine details to the broad lessons we can all learn when we think like a trader."<br/> <b>—Tim??Harford,</b> author of??<i>The Undercover Economist</i>??and??<i>Fifty Things That Made the Modern Economy</i> <p>"Do??we??need??another??book??about how to beat the stock market written by an arrogant trader? I sure don't. But, hey, wait, it turns out this is not about beating the market. Agustin Lebron is applying his experiences to actual real life, helping you with insights into how you can balance risk and reward, how to get to know yourself and your motivations. Entertainingly written as well as insightful."<br/> <b>—Dr. Paul Wilmott,</b> creator of wilmott.com and the Certificate in Quantitative Finance <p><b>TRADING IS AT THE CORE OF THE MODERN WORLD, FROM FINANCE TO THE GIG ECONOMY. LEARN FROM A PROFESSIONAL TRADER HOW TO SEE YOUR DECISIONS AS TRADING EXCHANGES—DO MORE OF THE TRADES YOU WANT AND FEWER OF THE ONES YOU DON'T.</b> <p>Trading is the act of buying and selling. Whenever you buy groceries, you are trading. Purchasing a car, ordering dinner, selling an item on eBay—all trades. Going to work is a trade, exchanging your labor for a wage. Trading is as old as civilization, and it's more ubiquitous today than ever. Unfortunately, accurate, reliable information on trading, particularly in financial markets, is hard to find. It's common for books on trading to try to sell you products and services. <p><i>The Laws of Trading</i> is different. Its purpose is to teach specific mental skills that extend far beyond the trading floor to wherever rational decision-making is important. <p>Science tells us that human decision-making is flawed, biased, and irrational. Learn to avoid these problems in day-to-day decisions. React in real-time with the appropriate decision. Leverage your unique skills and knowledge. Make profitable trades in your personal, professional, and financial life. <i>Think like a trader.</i>

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