Come Into My Trading Room: A Complete Guide to Trading

I owe a great deal to Dr. Elder's and his book Trading for a Living, though I was quite successful before I finally bought his book, it added another dimension, and gave me more sound understanding in what I was doing. Trading For A Living is a book I highly reccommend for anyone who's thinking about trying to enter the world of trading. This book is just as equally superb, with more depth into the technicals, that are definitely going to be useful for Futures traders. I'm 22 years old, and I truly respect the works that Dr. Elder's has put together, but I'm an options trader... let me refine that even more, I strictly buy calls and puts, I don't write calls at all, I'm not a professional, don't want to be. I did a few times and made a good amount of money, but didn't like the risk. I find his writing on options, even though it makes up only a few pages, is full of horrible misconceptions, and is completely divorced from the way an options trader thinks. Given the man is a futures trader, and almost gives nothing but praise for futures, while giving the most gloomiest views of stocks and options, and futures are time laden and levergaged product with nearly unlimited risk, I'd think he'd see the value in options instead of referring to them as lottery tickets, or as sucker bets. However, I don't want this to become all of my review, I feel it is something that has to be mentioned before the rest of the book can be talked about. Options are not only a reliable form of trading, they are a legitimate form for someone like myself who swing trades and never holds a position longer than six weeks.On Options:I'm just going to be very clear. He's right about all the mistakes amateurs make, I'm not denying that if someone enters the market with the gambler mentality, they're not going to lose everything, but that's the same thing in any market. It's all about money management, as it is for futures or stocks, I've traded both and doubled my money in stocks, before I found options. I trade options, not because I can't afford the other stuff, or because I'm looking to get rich quick--I want to make a career out of this--but because options fit into how I percieve the act of buying and selling, they fit my personality, and my attitude to the market (that of swing trading. I've barely ever held a position longer than 6 weeks). How much are you willing to lose, is the first real question anyone trading anything should ask themselves. I made a fortune by using the massive leverage of options, with never risking more than the money I would've lost had the stocks turned against me had I bought the stock (i.e, if I had a 5,000 dollar account and XYZ is breaking out of a bullish pennant at 18.50, and the 19.50 options are .50 cents, if I was going to buy 150 shares of the stock with my capital and set a stop loss at 17.00, I was willing to risk 225 dollars. I could buy 4 19.50 options for 200 dollars plus commissions, representing 400 shares of stock. The bet would be that the stock would rise a dollar in three weeks, my total risk, 205 dollars. If the stock goes up 20%, I would make more or less, 400% on my money. Worst case, it falls and I lose my two hundred. Average case, it does nothing, and I close out a week later with a 20 to 50% loss of capital. When you do options like that, and are a swing trader, like I am, options are not only safer--protecting me against gap downs--they are downright excellent at creating wealth). You risk more than one hundred percent of your investment when you buy futures, in fact you can actually lose more than you have in your account. If you're in full margin in a stock, and something happens, a scandal is revealed, the company goes bankrupt, you'd owe them the other half. In options, the underlying asset could go to zero, and you've lost only what you invested--that's what they mean by limited risk. But like Futures, like stocks on margin, you can cut your losses in options. That's right. As long as there's a bid, you can sell it. That means you can limit how much you are willing to lose. What a novel idea!!! It's not like money management is part of Elder's system... oh wait, it's the hallmark of the man's system. One of my best friends works in a hedge fund in Boston and trades options and stocks--he doesn't write options, he trades them. My biggest trade this year right now, is Priceline, I had 20 contracts, front month August, at 230, they cost me a little less than 8,000 dollars, I sold them for a little under 70,000 dollars, literally five days after I bought them. 20 contracts represented 2,000 shares of a stock trading at 228, which would've cost me 456,000 dollars. 8,000 dollars at that time represented less than 5 percent of my account (I will admit that I had no idea it was going to move like that, and was pleasantly surprised). I could've bought the stock using full margin, and fifty percent of my account, but why should I, since I was sure if a move was going to happen, it would in a couple a few days to a week or two, and I'd have till August 20th, and it was still July, if it didn't, I was pretty sure it was going to drop, and I didn't know how fast it was going to drop. If I did not respect Dr. Elders, that small 2 and a half pages would've turned me off his book completely. I want to make it clear. Dr. Elders is a brilliant man when it comes to Futures and technical analysis and the psychology of the market. But he should leave trading instruments alone.To his statement that no one he knows has built their capital with options, maybe that's true, I don't know who he knows. But the young men who formed Cornwall Capital turned 110,000 dollars into 30 million buying options before using credit default swaps to turn 30 million into 120 million. Victor Sperandeo, a professional trader, who traded options, and claims that 40% of all his market winnings came from options, and that he got started by trading options. Jim Cramer used options for the trade that paid for his entire education as he explains in his book, in fact, reading Confessions of a Stree Addict, it's clear he's used options a lot. Mark Weinstein started his fortune trading futures, got hit bad, went to trading options, turned 100,000 into 900,000 in three months, according to market wizards. Michael Parnese started off trading options in the wild bull market, where he turned 30,000 into 7 million. Marty Schwartz started off as an options trader, before he went to stock index futures, he truly built his fortune trading options, starting with 10,000 on the AMEX. I think when you state a matter of opinion, with limited knowledge, and few facts, you fail. He gives an example of stupid options trader, who let's his contracts expire worthless. Except for the times that I'm up over 300%, have gotten my money back, plus a profit, scaling out of the trade, I've never gone into the last week of trading, in fact, I'm usually out a month before the options expire, if not at least one week before (if they're front month options), every options trader I know does the same thing.Now to the rest of his book. Like he does in Trading for A Living, he goes through many forms of technical analysis, I feel this one was more in depth, and tailored to experience, though an amateur can certainly get some good ideas from it. He details lays out a great plan that coupled with Dr. Van K. Tharp's books Super Trader and Trade Your Way To Financial Freedom, I believe will get any person on the right track mentally to prepare to trade the markets. In the end, it really all is about controlling your emotion, controlling your money (taking care of losses and letting winners take care of themselves, no one's ever gotten in trouble cutting a winner short, plenty of would be millionaire's living on the street because they didn't cut their losses). This book is basically a psychological guide to prepare you, and it's a necessary one.I still prefer Trading for A Living, but have no regrets with this book at all, and reccommend it to anyone that ask me about the stock market.

I work with several colleagues of mine in late 30's and early 40's studying their MBA. They spend quiet a bit of money, time and family time ( cases where kid's tv addiction linked to parents doing their MBA). Few of them managed to get promotion,some had their titles changed, some moved to different companies doing similar jobs etc. I asked some of them what was their objective of studying MBA at this age. Most have a vague objective,but as Dr.Elder quotes "A caged animal trying to grab it's tail"!. All of them have invariably tried their hand in stock market, got burnt and move back to the comfort of 'cubicle jungles'.Had they spend the $20,000 or $30,000 they spend on MBA with proper training on trading, losses, trial and error in stock market, software many would have come far ahead in trading and 'self reliance' and 'early retirement' . Instead they fear the corporate layoffs and meaningless promotions that involve travel and less family time and divorce and rebellious kids. I have started the trading career like most others and lost money and thankfully got access to Dr.Alexander Elder's materials before a wipe off!So now, we have a better way of self graduating to "MBA of trading' where you can be self reliant and retire by simply digesting Elder's books, his suggested reading materials, software ( ex : Metastock , tradestation), bite the painful bullet of losses, enjoy the pleasure of successful trade and slowly evolve to a mature trader. If you are a working professional, you will spend as much ( or more) time as a regular MBA Course, but at least if you happen to be a person fit for becoming an "MBA In Trading", you will be far better off than a MBA in a corporate culdesac.Here is the suggested order to graduate yourself to an "MBA in Trading".1. Trading for a Living: Psychology, Trading Tactics, Money Management ( You will need to read it twice)2. Start making journals and learn from your on trading experiences3. Come Into My Trading Room: A Complete Guide to Trading (Masterpiece...Read 4 or 5 times to absorb the spirit and content of the book.)4. Entries & Exits: Visits to 16 Trading Rooms (Wiley Trading) (Read couple of times)5. Sell and Sell Short (Wiley Trading) (Read couple of times)6. Read the books mentioned by other full time traders in "entries and exits" ( ex: Trading in the Zone: Master the Market with Confidence, Discipline and a Winning Attitude)7. Understand Metastock, Tradestation, esignal type tools.8. Attend his seminar if you can afford it.Think about all the time ,money and effort you are going to put into it, it will be similar to the money spent on an MBA...and your title might be "Work from home CEO" with your job description like Self reliant full time trader who looks forward to Monday Mornings and for whom work is an everyday vacation and will work during a vacation also. He is available when kids need himReviewing his book in solitude will not serve the reader since it is a sequence of learning material in a tough world and should be treated as such.I would call Come Into My Trading Room: A Complete Guide to Tradingas his masterpiece,but Trading for a Living: Psychology, Trading Tactics, Money Management is highly recommended because of the sections like all technical indicators explained. Some tools might be tailor made for you. In Come Into My Trading Room: A Complete Guide to Trading, the book has narrowed down to exact trading tools Elder uses which is great,but for a newbie , it is better to read the entire menu ( Trading for living) and then chose your dinner ( Come Into My trading room). In trading parlance, The above two books will have to be your "core" positions .Entries & Exits: Visits to 16 Trading Rooms (Wiley Trading) And Sell and Sell Short (Wiley Trading) are the perfect desserts.E and E is a classic which walks through some sample trades and also a glimpse of tools those users use. All of the traders are trading for living, some with less than 250k equity . Elder looks at their trade and see how simple he makes his trading decision . Sell and Selling short is more like an addendum to his previous books with focus on exit strategies.I know there are plenty of readers who read financial (and wealth making) books for entertainment. If you are one of them ( The way to check is if you read financial books constantly AND do trading BUT do not have proper records), still this book will fit your case. Choice of words all along the book and subtle comedy makes it an equally interesting read.EXAMPLES of some punch lines (not verbatim):> A person who pees against the wind has no right to complain of laundry bills> Newbies swarm to options to get more bang for their bucks,but it is usually their head that gets banged.> What beginners call gut feel is usually an urge to gamble, and i tell them they have no right to a gut feel.> If you pay high above EMA, you will find a greater fool who will pay even more> Traders dream of profits but often freeze like deer in the headlight when a loss hits themWhichever book you read in whatever order, make sure to read it, read again and read again .. tread carefully on stockmarket.You might win and in small and subtle ways it is happening to me!

My rating of 4 stars is an average of 5 stars for beginners and 3 stars for experienced traders.A significant part of this book is dedicated to psychology and money management which are aspects of trading that any experienced , profitable trader should have overcome. The portion of the book dedicated to trading methodology is slightly more than half of the pages in the book, which would be ok if it wasn't for the fact that very few new trading ideas are presented. The bulk of the trading techniques presented are based on divergences between specific technical indicators and price which are common knowledge to most moderately experienced traders. The author does present a couple of ideas that may be new to inexperienced traders such as Triple screen , however for me at least , this was a renaming of what most experienced traders commonly do ; that is look at both weekly and daily charts or multiple timeframes to insure that any stock they trade is trending their way over the long term.About 20 pages starting on page 193 deal with trading options which was done in a very basic way. This is to be expected since the book is mainly about stocks but what I felt was unwarranted was the negative view on options indicating that they are just empty hopes. Read the sentence on page 193: "Most hopes never get fulfilled but people keep hoping and buying options. Fund Managers....sell hope by the truckload to amateurs that buy calls in bull market and puts in bear markets". While this may be true on the surface, traders do make money with options often selling them or using them to augment their stock trading profit.In summary, this book can offer some useful ideas if you are a beginner , however if you have moderate trading experience your likely benefit is very limited.

When I first started out in trading stocks 9 years ago, I set out by researching virtually every trading strategy and method available. It wasn't until I began discounting many of the strategies that I learned, forming a philosiphy on how I think the markets worked, and applying a single method in trading based on how I think the stock market works that I began to stop losing money. Only until I learned how to overcome emotional barriers did I begin to actually start making money.There are way too many books out there that limit themselves on how to draw trendlines, how to calculate Stochastics, etc. We don't need anymore books that spend pages on head and shoulders and limit the entire book on technical patterns and oscillators, information that can be found on many other books out there. Come into My Trading Room is not another of those books. It is by no means a definitive guide to chart patterns or oscillators. We don't need anymore of those, we need more books like this, that go beyond that, on application, mindset, trading size, recordkeeping, keeping yourself in check, and other important parts that make a well rounded trader.Trading is hard, I think harder than investing, due to the substantial psychological barriers that you must overcome. To that point, I was expecting more from the "Mind" part of the book, considering he was a trader as well as psychologist.I already have my "bullets" as the author talks about, and won't be using the Elder Ray, or his other proprietary indicators. I'm sure they may be good indicators but they don't fit in with my strategy, they may very well work wonders for some of the people that read this book and use them. I did pick up a few things from this book I found useful, and this is coming from one of those guys that's read literally 100+ books on the matter. I think this is ia good book and recommend it to everyone, especially for the new trader or the trader not using a predefined system that tells him exactly what to do. This is a good book even if you don't use the tecnical analisys methods he talks about. He is basically saying, "this is what I do, use them or something else, but understand thoroughly whatever it is you use."I do disagree with Elder that mechanical systems traders are doomed to fail and are lazy, and want some computer to do their thinking for them. Some may be, but some market students have done well using mechanical systems. Sheldon Knight made a fortune using his system, Ed Seykota makes money only when he uses his system. I doubt that Elder would not consider Ed Seykota is not a lazy person wanting a system to do his work for him, had he met him or read any of his writings. There are some more out there, but you can't be lazy and limit your knowledge to some little computerized system, and it's very hard to stick with a computer program when it's going through a large drawdown.Trading is hard. For some, it's harder than others. It was very difficult for me starting out because I made every mistake possible, for one thing, I realized looking back, my commissions caused a majority of my losses, and I definitely went about it the wrong way. If I read and APPLIED the teachings in this book, I would have been a lot better off long ago. You don't even have to use his "bullets" as he talks about in this book.This is a good book for any trader to read.

An outstanding introduction for the beginning trader. Dr. Elder presents the SafeZone trailing stop indicator, a very simple but effective trading method based on price divergences from long term trends, and his Triple Screen System - which means using multiple time-frames to determine entry points. However, the method is presented as an example to illustrate the actual substance of the book - How To Become a Successful Trader.Dr. Elder covers the three aspects of success:Mind - Mastering your own mind is at the core of being successful in anything. Here he discusses the psychology of trading - how close it can come to gambling and how to avoid that.Method - Your actions must be correct to achieve success. Dr. Elder shows how to apply the concept of mastering your mind to an actual trading system.Money - Trading is a risky enterprise. "Managing risk" is another term for "trading profitably." - provided you own your 'mind,' and you've chosen a working 'method.'I don't believe there's anything wildly 'new' in "Come Into My Trading Room." It is not a technical analysis textbook (plenty of those around,) and it's certainly not a trading system in itself. It's a very clearly written, broad introduction to trading and a hands-on-guide to teaching yourself to be a successful trader.Most useful? If you already know all about keeping comprehensive records and written trading plans, if you've mastered self-discipline to prevent the gambling trap, then the next most valuable tool Dr. Elder gives us is a grading method to objectively measure the success of our trades, and ultimately our overall progress as traders. The SafeZone and Force Index indicators are clearly valuable, but they're like the secret spy ring to the rest of the books delicious Cracker-Jacks.Highly recommended as a 'First Read.'

I believe a strong number of people will consider purchasing this book because they desire to learn how to become a 'technical' trader. There is of course nothing wrong with such reasoning. For this purpose alone, 'Come Into My Trading Room' is a brilliant piece of writing. But this book is FAR BEYOND that. The author takes from illustrations from his own life, mistakes in trading, examples from individuals he knows and first delves into topics such as :Disciplined TradingBusiness Risk vs. Trading LossThe Mature vs Immature Trading PsycheEquity Money ManagementIt is OK to Make Mistakes but Not OK to Repeat ThemIn other words, forget about learning how to become a technical trader if you do not follow disciplined, technical trading rules, do not set losses at a certain percent of equity and not change it, love trading for the action and not have a defined moral purpose. As the author states, you are a loser and your trading account value will continually prove it.Yet if you are willing to change how you currently trade, have hit rock bottom and discipline sounds like the salvation you need, or not get the trading results you are striving for, 'Come Into My Trading Room' is an absolute gem! Very easy to read, no Wall Street jargon even as he describes in detail various technical trading tools and the logic behind it. By-the-way; the Kindle version allows you the ability to add your own personal notes.

I just finished reading this book for the second time and it's awesome. I read it back in 2003 and remember thinking the same thing. In the technical analysis section, I really like how the author not only explained the theory behind each indicator, but also included the formula used to calculate it. This book teaches you how to keep good records and also how to manage your losses using a 2%/6% stop-loss method.You can tell there was a lot of thought put into this book. It was very well written and everything was explained in detail. The psychology of trading was included in each and every one of the chapters. You learn the thought process of the traders behind the market(s) and also what to think about when creating your own indicators. The author shares two of his personal indicators, "Force Index" and "Elder-Ray" and why they were designed the way they were.There's a lot that both beginning and advanced traders can learn from this book. The lower reviews that I have read on this book seem to be due to lack of material or applicability for/to day trading. The author does not focus much on day trading in this book, but even though I am not a day trader, I think a lot of the concepts could be applied to any type of trading (day trading included).

Eloquently written, Come Into My Trading Room impresses the reader in that you truly believe you're learning from a veteran trader.However, I will echo what others have said in that this book could have been condensed considerably. Insofar as Elder possesses a great talent for writing, his method of teaching relies too much on metaphor. If you cut out all the metaphorical support, the book would hardly breach 50 pages. Those pages would be extremely valuable, but too often I found myself scanning paragraphs to ascertain whether they were worth my time."A beginner shoots at anything that moves, including his own shadow. An old hunter knows exactly what prey he is after and brings only a few bullets." All too frequently, real estate is committed to creating these metaphors, and not just at the beginning of chapters. They do provide clarity but - in excess - they dilute the book's value. I definitely derived value from it but I stress that Elder's qualitative approach can only be appreciated by true beginners. Unless this is going to be your first foray into trading, maybe try a book that delves more into the nitty gritty.

Alexander Elder’s Come Into My Trading Room is a sharp, practical guide that expands on Trading for a Living. It delivers clear strategies for managing risk, mastering discipline, and building a sustainable trading routine. Elder’s insights into trader psychology and his structured approach make this book a powerful tool for anyone serious about long-term success in the markets. Concise, actionable, and inspiring.

The amount of material that this book covers makes it a must read for every trader out there. Cannot recommend enough!

Muito didático e traz conceitos bem sólidos de análise técnica. Ótimo tanto para aqueles que estão começando, quanto para traders experientes.

C'est l'ouvrage le plus intéressant que j'ai pu lire à présent, car il très complet et plus particulièrement concernant la gestion du risque (Money Management).L'auteur vous expose une méthode entière, de A à Z, et fourni les méthodes de calcul.Je ne peux que le recommander chaudement, aux débutants, intermédiaires et même aux initiés.

This book is a wonderful followup to Elder's classic "Trading for a Living."It covers all aspects of trading from risk management to how to manage your profits. The greatest strength of this book is that it addresses which instrument to trade based on the reader's preference rather than Elder's own opinion. He lays out the pros and cons of Stocks, Futures, Currencies, and Options then offers further recommended reading each prospective field. I found this exceedingly helpful and continue to use it as a reference when I am feeling unsure of what I should do next.