Details

<p>Preface vii</p> <p>Acknowledgments xiii</p> <p>About the Author xv</p> <p><b>Part I Principles of Risk Management 1</b></p> <p>Chapter 1 Foundations of Risk Management 3</p> <p>Chapter 2 Five Steps in the Risk Management Process 11</p> <p><b>Part II Managing and Measuring Risk 61</b></p> <p>Chapter 3 Predictive Analytics Using Quantitative Analysis 63</p> <p>Chapter 4 Statistical Edge and Its Impact on Risk 71</p> <p>Chapter 5 Embracing a Culture of Analytics 113</p> <p><b>Part III Qualitative Elements of Risk 145</b></p> <p>Chapter 6 The Human Element: Psychological Risks of Trading 147</p> <p>Chapter 7 Preparing for Risk and Loss 161</p> <p>Chapter 8 Business Risk Management for Traders 181</p> <p>Bibliography 201</p> <p>Index 203</p>

"<i>The Risk of Trading</i> is a call to arms for the trader who either keeps no trading journal at all or simply records profit and loss. Metrics are critical to success." (<i>Seeking Alpha</i>, May 2012)

<p><b>MICHAEL TOMA, CRM,</b> is a corporate risk manager and specialist in trading the equity index and futures markets in the United States. A Certified Risk Manager, Toma is a frequent speaker on the industry trading conference circuit. His first book, <i>Trading with Confluence</i>, released in 2010, provides a first-hand perspective of risk-based trading and the challenges that new traders are forced to overcome. In addition to managing his own international risk management consulting firm, he is an active member of several risk management organizations and research academies that promote corporate ethics and risk management educational programs.

<p>Whether trading as an individual or as part of a firm, you are in a business where the chance of loss is always a possibility. Despite this reality, there are ways to shift the odds in your favor and gain the edge required to be successful. <p>Nobody understands this better than author Michael Toma—a Certified Risk Manager with extensive experience in the field of finance. And now, in <i>The Risk of Trading</i>, he outlines a holistic, or "enterprise-based," approach towards managing risk that encompasses not only the risks of a trade, but also the risks for the trader and ultimately the business of trading. <p>Divided into three comprehensive parts, this reliable resource skillfully shows how combining data-driven insights with a proven risk management process will allow you to meet your trading goals and objectives over time—whether you're trading stocks, futures, ETFs, or other securities and derivatives. Along the way, you'll discover how a broader understanding of managing risk as a trader can put you in a better position to identify, assess, control, measure, and monitor it. <ul> <li>Part I provides an introduction to the principles of risk management as well as a five-step risk management process and how it can be applied to your trading endeavors</li> <li>Part II addresses practical applications of managing and measuring risk using data analytics and explores leveraging solid trading strategies within a culture of metrics</li> <li>Part III discusses the human risk elements that challenge every trader, from managing losing streaks and drawdowns to taking emotions out of your trading decisions</li> </ul> <p>Filled with in-depth insights and expert advice, <i>The Risk of Trading</i> is a must-read for anyone serious about achieving long-term trading success.

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