June fourth, two thousand twenty-six
Casebook (Part Two): A Deep Dive into Risk-Reward
《Casebook (II)：A Deep Dive into Risk Reward》
Author: Ariston
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1 / tungsten hexafluoride
Figure:View note
Figure: basket proxy (daily chart, as of 260604)+410%, move the stop above 178
Figure: basket proxy (daily chart, as of 260604)+40%, move the stop above 40
2 / MLCC
Figure: basket proxy (daily chart, as of 260604)+100%, move the stop above 120
Figure: basket proxy (daily chart, as of 260604)+180%, move the stop above 14k
Figure: basket proxy (daily chart, as of 260604)+130%, move the stop above 8.5k
Figure: basket proxy (daily chart, as of 260604)+120%, move the stop above 120
Figure: basket proxy (daily chart, as of 260604)+90%, stop moves above 57
3 / Technology
On “doing nothing,”View note《Reminiscences of a Stock Operator》 and 《How to Trade in Stocks》 offer excellent explanations. Excerpts are included here for everyone’s reference; read them and put them into practice, Don’t be a Wall Street fool.
Image: Reminiscences of a Stock Operator, Chapter II
1 / When Jesse Livermore reflected on the reasons for his failures, Getting the judgment right is not the hardest part. The real challenge is acting only when “conditions support your judgment.” There are times when the market calls for action, and times when it does not; many losses come not from failing to understand the market, but from being unable to resist the urge to trade.
“What beat me was not having brains enough to stick to my own game—that is, to play the market only when I was satisfied that precedents favored my play. There is a time for all things, but I didn’t know it. And that is precisely what beats so many men in Wall Street who are very far from being in the main sucker class. There is the plain fool, who does the wrong thing at all times everywhere, but there is the Wall Street fool, who thinks he must trade all the time.
“What really beat me was not that I wasn’t smart enough, but that I didn’t have the brains to stick to my own way of doing things—that is, to trade in the market only when I was sure that past precedents supported my judgment. There is a time for everything; I just didn’t understand that at the time. That is precisely what defeats so many men on Wall Street who are actually far from being the most typical kind of fool.There is the ordinary fool, who does the wrong thing everywhere and at all times; but there is also the Wall Street fool, who thinks he must be trading every moment.
No man can always have adequate reasons for buying or selling stocks daily—or sufficient knowledge to make his play an intelligent play.
No one can have sound reasons to buy or sell stocks every day, nor can anyone always have enough information to make every trade a truly intelligent one.
... The desire for constant action irrespective of underlying conditions is responsible for many losses in Wall Street...”
... The desire for constant action irrespective of underlying conditions is responsible for many losses in Wall Street...”
Image: How to Trade in Stocks, Chapter 1
2) Speculation should be treated as a “business,” not as pure gambling.There really are times when it is right to act in the market, and just as surely there are times when one should stay out. The idea that one can make steady profits by trading every day or every week is naive and reckless.
“There are times when one should speculate, and just as surely there are times when one should not speculate.”
“There are times when one should speculate, and just as surely there are times when one should not speculate.”
“Only the foolhardy will try it.”
“Only the foolhardy will try it.”
Image: Reminiscences of a Stock Operator, Chapter VI
3) When Old Partridge says, “This is a bull market,” he is essentially saying that the big money comes from catching the main trend, not every small fluctuation. Many people get the direction right and the timing right, yet still fail to make big money because they cannot hold on; in the end, they lose to their own impatience and doubt.
“I think it was a long step forward in my education when I realized at last that when old Mr. Partridge kept on telling the other customers, ‘Well, you know this is a bull market!’ he really meant to tell them that the big money was not in the individual fluctuations but in the main movements...
“When I finally realized that when old Mr. Partridge kept telling the other customers, ‘Well, you know this is a bull market!’ what he really meant was:The big money is not in individual little fluctuations, but in the main trends...At the time, I felt that my understanding had taken a big step forward.
And right here let me say one thing: After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: It never was my thinking that made the big money for me. It was always my sitting. Got that? My sitting tight!
Here I want to make one thing clear: I spent many years in Wall Street, made several million dollars and lost several million dollars; and what I want to tell you is that What really made me big money was never my judgment itself, but my ability to sit tight.Got it? It was holding on to my position!
... Men who can both be right and sit tight are uncommon. I found it one of the hardest things to learn.
... People who can both be right and hold on tight are uncommon. I found this to be one of the hardest things to learn.
... The market does not beat them. They beat themselves, because though they have brains they cannot sit tight.”
... It is not the market that defeats them, but they defeat themselves. Because although they have brains, they cannot sit tight.”
...
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End of full text.
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Note: All content herein is for reference only and does not constitute any investment advice, nor does it serve as the basis for any laws, regulations, or regulatory policies. Investors should not use or rely on such information as a basis for decision-making.
Note: All content in this document is for reference only. It does not constitute any investment advice, nor does it serve as a basis for any laws, regulations, or regulatory policies. Investors should not use or rely on such information as the basis for decision-making.