This book is a great addition to the trading world. It is unique in it’s structure and the knowledge of the participants is impressive. The book is structured as a round table question and answer session with four legendary traders, answering questions that they receive regularly. The panel consists of two ‘Market Wizards’ that appeared in books by Jack Schwager, and who also won trading championships: Mark Minervini and David Ryan. Trading World record holder Dan Zanger is also a participant. Dan turned $10,775 into $18 million in 18 months in the late 1990’s. One of Mark Minervini’s top students and son of a Market Wizard, Mark Ritchie II, rounds out the table. Like the other panelists, Mark has achieved triple digit account returns.
The book does a excellent job of covering the areas of risk management, psychology, and methodology. The traders are straightforward with their answers about specific trade rules, position sizing, and trade management. I like reading their discussions of specific trading tactics, as well as their stories of success and failure over the years. They were all humble and generous with their answers.
This book is primarily about buying high and selling higher. Position sizing your trading account or portfolio with 10% – 25% in one high-growth stock, and cutting it short if it reaches your stop loss. Letting a winner run for weeks or months if it takes off in a trend is also discussed. This may be too much risk for some traders, but it is the path to triple digit returns in the right market. You need to put a lot of eggs in the best basket, and watch that basket closely. The panel’s large returns are also made by rotating through stocks during the period where they have momentum and are being accumulated. They explain the importance of keeping the winning stocks and letting winners run while cutting losers short, and selling stocks that do not move in favor of those that do. They advise against trading options and focus on stocks. Their systems for buying momentum stocks work best early in bull markets, and less as a bull market grows old. They are primarily in cash during downtrends and bear markets. I was very glad to see Dan Zanger, William O’Neil’s top student David Ryan, Mark Minervini, and Mark Ritchie II share their stock trading wisdom.
This is a high value add to any trading library and I am glad they sent me a review copy. I am a longtime fan of all of these traders. Book Link here–> Momentum Masters.