Jack D. Schwager

I've done a number of these interviews, Tim, and it's really become a common theme.

And in fact, the largest trading series ever written, I'm sure you're aware, Jack Schwager, that was the market wizards.

The common theme there was risk management.

And so often, you hear the younger traders, they get involved and they're so focused on making money that they lose sight of the risk and playing good defense like you were saying.

There may be another market that catches our eyes because of something big that happens where all of a sudden we say we now have a setup.

um i got a beautiful career i pinch myself sometimes when i go my goodness i've made my living trading markets how crazy is that i never set out to think that i i would have never guessed that here i'm 51 years old in the market i've traded in six different decades successfully and we have traded successfully as a firm when i was included for a market wizard's book and i don't know how jack does it anymore But we have to produce very, very documented records on our trading performance.

You know, for Jack, I had to provide monthly statements for all of our accounts.

I had to provide IRS statements that would reconcile profits reported to the IRS against bank records.

Jack did a thorough job.

I don't know how he did this past book, whether he continued to look.

But Jack had us figured out that at an average annual rate, rate of return of about 51%.

Our last losing year was 2013.

Jason's a veteran trader and he's been in the game for decades.

He was featured in Jack Schwager's book, Unknown Market Wizards: The Best Traders You've Never Heard Of.

Well, we've heard of Jason on the show and he likes to take or identify the most crowded trades and do the contrarian bet, which is to go against the crowd, or at least identify where the risk-return trade-off is not there anymore and stay away.

So that's what he's gonna do with us today.

No, I'm not necessarily talking about that.

What I'm talking about is take the skill of yourself and every other trader who's ever been, who's ever been analyzed, take every word that Jack Schwager ever wrote in the Market Wizards series, and start as a, a, a search the Internet for everything more you can find out about the track record of all of those famous humans.

And basically tell AI your job is to generate alpha and beat the humans at it.

And let AI figure out what it needs to do to do that by assimilating every skill you ever knew from your world of fixed income, and every skill that St- Stan Druckenmiller ever knew from his world, and every skill that every other famous trader ever knew, and just be better at it than we humans are.

Yeah.

You know, Jack Schwager, we had one of the podcasts recently, and he said even as well, risk is more easily tied to technicals versus fundamentals.

Because like, let's say what you're saying with fundamentally this company should be at 100.

So I'm just going to scale into it into oblivion, essentially all the way down to zero.

Uh, one of my, you know, favorite, uh, featured traders in the New Generation Market Wizards book is Simon Rousso, who- whose name, of course, is not his real name.

But he was a music student initially be- before becoming now what's probably, you know, the best trader of all time according to Jack Schwager.

Right.

Um, but it was...

So reading outside of your field is very important.

Some of the books that we recommend you read within the field, one up on Wall Street by Peter Lynch, You Can Be a Stock Market Genius by Joel Greenblatt, The Letters of Warren Buffett, I believe compiled by Cunningham, any book by Hagstrom, all the books by Michael Mauboussin and his essays, including More Than You Know, including Expectations in Investing, And then you also have to read Reminiscence of a Stock Operator, the Jack Schwager books.

You have to read Steve Drobny's books.

There are others as well by esoteric investors that no one has mostly heard of.

If you actually want to read some books, I would refer you to one called Following the Trend by Andreas Kleinau, which I will link to in the show notes.

Another book would be A Complete Guide to the Futures Market by Jack Schwager.

And then I'm also going to give you a link to a 687-page document put out by Top Traders Unplugged, which lists investing resources in about 20 different categories, including one with managed futures and 24 books about that.

I don't suggest you print that document, but you can certainly search it for all kinds of books about different kinds of investing.