It's been said that among traders there are those who quietly know and there are those who desperately hope. The trick is to equip yourself with the tools and mindset to enable you to join the ranks of the first group rather than the second. To that end I'm just finishing up Peter Bernstein's history of risk. Now, before you roll your eyes in utter boredom, I've got to say that this book is just as exciting as any Agatha Christie mystery or Charles Dickens classic. The cast of characters is equal to none. Along the way you'll learn about the quirks and foibles of such colorful notables as Fibonacci, Cardano, Bernoulli, Gauss, Galton, von Neumann (father of game theory), Markowitz and many, many more who were responsible for developments in mathematics that led to probability theory, betting, uncertainty principles, game theory, the insurance industry and, of course, risk management. The book covers a lot a ground but if trading is your thing and you want to develop a methodology to limit your losses, this book will certainly give you a lot of ideas to spring off from. This is not a trading book . . . there are no systems described or TS code for you to cut and paste. but you'll get a good perspective on how some of the best mathematical minds in history solved complex problems (sometimes with great success, sometimes with resounding failure). I bought a used copy through Amazon for $7.50, although it appeared new to me. A bargain at 10x the price IMHO.
Just a few things to ponder in closing:
Half the people you know are below average.
The 50-50 rule: anytime you have a 50-50 chance of making money in the market. .there is a 50-50 probability you'll lose money.
The early bird may get the worm, but the second mouse always gets the cheese.
And as my friend Steve Forbes says: "It's better to be lucky than smart".
Frankly, I tend to believe that you make much of your own luck and as such I'd prefer to be lucky and smart.