How To Make The Stock Market Make Money For You

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· 28 ratings · 2 reviews

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Sep 11, 2020 Josiah R rated it really liked it

This is a book I had never heard of, and I was pleasantly surprised by it. I especially enjoyed reading about Ted's beginnings in the depression era, where he and his wife were living in separate homes, working for a buck or two per day in some cases as a farm hand and a cook. They finally managed to scrape together a small capital base for his first speculation and made several hundred dollars, only to have the proceeds stolen by his broker who skipped town. That would have been really deflatin This is a book I had never heard of, and I was pleasantly surprised by it. I especially enjoyed reading about Ted's beginnings in the depression era, where he and his wife were living in separate homes, working for a buck or two per day in some cases as a farm hand and a cook. They finally managed to scrape together a small capital base for his first speculation and made several hundred dollars, only to have the proceeds stolen by his broker who skipped town. That would have been really deflating to someone's spirit I think, especially in a time when a dollar was worth a hundred times what it is now. But they kept pushing forward and eventually found themselves going on exotic trips in the outback of Australia and other places.

The author's primary approach is to look for dull, depressing price action, in the low area of the historical price range, on a long term monthly timeframe chart, and then "fade" it ... basically with the assumption that if the price action is dull and looks like it's going nowhere fast, that means it's being accumulated quietly, so that's when it's most likely to do the opposite. Low volatility leads to high volatility and vice versa. He also discusses using triangle formations and a few other bottoming patterns as a guide. He states that tops should be put in on violent price action and higher volume, whereas bottoms should be on quiet action and low volume.

His approach is to buy while it's quiet, preferably before any breakout has happened. This approach is fine for someone whose investing time horizon or holding period is very long, at least multiple years, but it definitely implies the need for a lot of patience.

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