I read "How I Made $2million$ in the Stock Market" by Nicolas Darvas 3 times and this is what you only need to know !
A thread ๐งต
A thread ๐งต
Chapter 1: The Gambler
Summary: Darvas starts his journey with a gambling mindset, viewing the stock market as a game of chance. His early trades are based on tips and gut feelings, leading to losses.
Key Examples:
- Initial Losses: Darvas experiences losses by random tips
Summary: Darvas starts his journey with a gambling mindset, viewing the stock market as a game of chance. His early trades are based on tips and gut feelings, leading to losses.
Key Examples:
- Initial Losses: Darvas experiences losses by random tips
Chapter 2: Learning the Hard Way
Summary: Realizing the need for education, Darvas begins studying stock market principles, understanding that success requires knowledge and strategy, not luck.
Key Examples:
- Reading and Research: He studies market experts like Graham and Dodd
Summary: Realizing the need for education, Darvas begins studying stock market principles, understanding that success requires knowledge and strategy, not luck.
Key Examples:
- Reading and Research: He studies market experts like Graham and Dodd
Chapter 3: Finding a Method
Summary: Darvas develops his "Box System," focusing on identifying price ranges and trading based on breakouts, relying on price and volume indicators.
Key Examples:
- Brilund: Darvas buys Brilund stock after it breaks out of its defined price range
Summary: Darvas develops his "Box System," focusing on identifying price ranges and trading based on breakouts, relying on price and volume indicators.
Key Examples:
- Brilund: Darvas buys Brilund stock after it breaks out of its defined price range
Chapter 4: Perfecting the System
Summary: Darvas refines his system, focusing on strong stocks in rising industries and using stop-loss orders to protect against large losses.
Key Examples:
- Lorillard: He waits for Lorillard to break out of its box and buys
Summary: Darvas refines his system, focusing on strong stocks in rising industries and using stop-loss orders to protect against large losses.
Key Examples:
- Lorillard: He waits for Lorillard to break out of its box and buys
Chapter 5: The Importance of Self-Discipline
Summary: Discipline, patience, and emotional control are crucial for successful trading. Darvas learns to stick to his system and not be swayed by emotions.
Key Examples:
- Texas Instruments: Following his system and staying put.
Summary: Discipline, patience, and emotional control are crucial for successful trading. Darvas learns to stick to his system and not be swayed by emotions.
Key Examples:
- Texas Instruments: Following his system and staying put.
Chapter 6: Managing Success
Summary: Managing a growing portfolio and dealing with psychological pressures are part of successful trading. Darvas learns to remain rational and not get overconfident.
Key Examples:
- Media Hype: Darvas avoids being influenced by media hype
Summary: Managing a growing portfolio and dealing with psychological pressures are part of successful trading. Darvas learns to remain rational and not get overconfident.
Key Examples:
- Media Hype: Darvas avoids being influenced by media hype
Chapter 7: Final Lessons
Summary: Darvas consolidates his lessons and offers final advice to traders, emphasizing continuous learning, adapting to market changes, and maintaining a disciplined approach.
Key Examples:
- By adhering to his rules, Darvas avoids a potential loss
Summary: Darvas consolidates his lessons and offers final advice to traders, emphasizing continuous learning, adapting to market changes, and maintaining a disciplined approach.
Key Examples:
- By adhering to his rules, Darvas avoids a potential loss
Practical Applications and Key Takeaways:
1. Box System:
- Define a price range (box) for a stock.
- Buy when the stock breaks out of this range on high volume.
- Set stop-loss orders below the box to manage risk.
1. Box System:
- Define a price range (box) for a stock.
- Buy when the stock breaks out of this range on high volume.
- Set stop-loss orders below the box to manage risk.
2. Risk Management:
- Always use stop-loss orders to protect against significant losses.
- Avoid putting all your capital into one trade.
- Always use stop-loss orders to protect against significant losses.
- Avoid putting all your capital into one trade.
3. Emotional Control:
- Maintain a rational and detached mindset.
- Do not be swayed by market rumors or media hype.
- Maintain a rational and detached mindset.
- Do not be swayed by market rumors or media hype.
4. Continuous Learning:
- Keep studying market trends and principles.
- Adapt your strategy based on new knowledge and market changes.
- Keep studying market trends and principles.
- Adapt your strategy based on new knowledge and market changes.
That's all about this thread !
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I hope you've found this thread helpful.
Follow us @chartians for more.
For live stocks and options trade updates, you can join our Telegram Channel โคต๏ธ
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Like/Repost the quote below if you can:
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