Many successful stock and commodity traders still base their methods on these rules. Livermore constructed his rules over several years, while learning by trial and error what worked on the markets. Whatever happens in the stock market today has happened before and will happen again. Do not trade every day of every year. Trade only when the market is clearly bullish or bearish.
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Sister — Mabel Loraine Blethen. Brother — Elliot Livermore. During his youth Jesse was fascinated by numbers. He loved math, writing, reading, and various subjects school had introduced him to. Jesse had other plans. He was working at the offices transferring prices from ticker-tape to quotation board. While there, Jesse starts learning to read the tape and discovered that he could speculate at the many bucket shops unauthorized office for speculating in stocks around town.
Livermore an ultimatum: either quit speculating in bucket shops or quit his job. He quit his job. He continued and his losing streak completely wiped out his bankroll. However, he attributed his loses to slow execution of his trades.
However, due to horrendous trading, Jesse ended the day completely broke. Once again Jesse Livermore, without a dime to his name, returned to the bucket shop scene with a mission to make another fortune. Through his bucket shop skill and trading he successfully accumulated enough money to buy an automobile and start a lifestyle that would even make the rich envious.
In Jesse added to his losing position in cotton and sold his winning position in wheat and goes broke again. With nowhere to turn Jesse Livermore asked Dan Williamson for help who offered him the facility to trade shares. In Jesse is a multi millionaire again and paid back all his debts. Billions of dollars were lost, destroying thousands of investors except for Jesse Lauriston Livermore.
When Jesse got home he was surprised to walk into a totally vacant house. She told him she moved everything out because she was sure they had lost all their money.
He proceed to ease her mind telling her he had made more money than he had ever made before. One day later he returned to his home feeling very weak and unsteady. He said he returned because he read a newspaper headline about his disappearance bringing him back to his senses. He and his wife sailed to Europe using the family annuities he set up years earlier.
It is published in Later that year In , Jesse was reportedly suffering from clinical depression. A photographer asked if he minded if he took his photo. The Police discovered an 8 page handwritten suicide note in his personal leather bound notebook.
Things have been bad with me. I am tired of fighting. This is the only way out. I am unworthy of your love. I am a failure. I am truly sorry, but this is the only way out for me. He was kicked out of several bucket shops for always winning. He had 2 children with Dorothy: Jesse Livermore Jr. He smoked cigars. As his popularity grew in the media, people bought and sold stock based on his recommendations in the papers.
His hobbies were fishing favorite , hunting and playing golf. He was a womanizer. He lived. Unfortunately, Jesse Lauriston Livermore went bankrupt 3 times in his lifetime.
Jesse Livermore Jr. It always was my sitting. Got that? My sitting tight! They beat themselves, because though they have brains they cannot sit tight. What he desires is to be told specifically which particular stock to buy or sell. He wants to get something for nothing. He does not wish to work. It is wearing me out.
What can I do? But I do not tell people to buy or sell any particular stock. In a bear market all stocks go down and in a bull market they go up. I never argue with the tape. He must fear that his loss may develop into a much bigger loss, and hope that his profit may become a big profit.
Beware of inside information. If there was easy money lying around, no one would be forcing it into your pocket. You will reap benefits from their mistakes. I am depending on him. Suppose Smith is away on a holiday when the selling time comes around? A loss never troubles me after I take it. I forget it overnight. But being wrong — not taking the loss — that is what does the damage to the pocket book and to the soul. The cotton showed me a loss and I kept it.
The wheat showed me a profit and I sold it out. Of all the speculative blunders there are few greater than trying to average a losing game. Always sell what shows you a loss and keep what shows you a profit. If this is the case, then sell your position down to the sleeping level. Markets are never wrong, opinions often are. Being a little late in a trade is insurance that your opinion is correct.
Never average losses. Let this thought be written indelibly upon your mind. I found it one of the hardest things to learn. But it is only after a stock operator has firmly grasped this that he can make big money. Jesse Lauriston Livermore [Blog Post]. Reminiscences of a Stock Operator [Book].
Everything above was fully researched and should be true, but it may not be entirely factual as the evidence and facts on the life of Jesse Livermore were not always well documented. Please know that the facts above are, to the best of my knowledge, accurate. Any discrepancies, inaccuracies or misprints that are discovered can be changed if you send me an email with proof of your facts here. Disclosure: Some of the links in this post are from my sponsors.
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The Life & Death of Jesse Lauriston Livermore
Early life[ edit ] Livermore was born in Shrewsbury, Massachusetts , to a poverty-stricken family and moved to Acton, Massachusetts , as a child. At the age of 16, he quit his job and began trading full-time. He then moved to St. Louis , where he made bets at bucket shops. Morgan , who had bailed out the entire New York Stock Exchange during the crash, requested him to refrain from further short selling. He joined exclusive clubs and had mistresses.
Jesse Livermore: Lessons From a Legendary Trader
Livermore, who is the author of How to Trade in Stocks , was one of the greatest traders of all time. There is no question that times have changed since Mr. Livermore traded stocks and commodities. Markets were thinly traded , compared to today, and the moves volatile. Jesse speaks of sliding major stocks multiple points with the purchase or sale of 1, shares. Despite the change in times, his rules still apply, and the price patterns he looked for are still very relevant today. We will look at a summary of the patterns Jesse traded, as well as his timing indicators and trading rules.