Options Trading Sites:
- Capital Discussions
- Create Monthly Income Fund (Jonathan Lien)
- SMB Options Tribe
- The Lazy Trader
- Trade With Aram
Note from Dan: As of 2/27/2016 I am in the process of updating the reading list below.
I have a library full of trading books and while I like to think that I’ve learned something from each of them, that’s probably inaccurate. The books listed below add a ton of value and I highly recommend you check them out if you haven’t already. Feel free to let me know if there’s a book you don’t see in the list, but you feel should be included.
Technical Analysis Using Multiple Timeframes is quite possibly the only book you will ever need to buy on technical analysis. Brian Shannon does an excellent job of explaining the basics of technical analysis, but the real value is in his discussion of market cycles and explanation of multiple time frames. He does an excellent job of explaining technical analysis in an applicable, rather than theoretical, way.
General Options Trading:
Intermediate/Advanced Options Trading:
Option Volatility & Pricing: Advanced Trading Strategies and Techniques is an excellent resource that goes into detail on options. Natenberg provides a good explanation for volatility and while this book is a little high level for beginners, the information is essential. Option Volatility & Pricing talks both about volatility and the statistical principles that surround volatility and option pricing models.
Trend Following Trading:
Trend Following: Learn to Make Millions in Up or Down Markets is a great introduction to Trend Following. The book gives a general overview of trend following and then dives into discussions with many famous trend followers. The track records of trend following traders across multiple decades and market cycles illustrate the power of trend following systems.
The Complete TurtleTrader: How 23 Novice Investors Became Overnight Millionaires could quite possibly be the best $12.84 you’ll ever spend. Richard Dennis was a famous trader who made a bet on whether or not trading could be taught. Dennis believed that trading could be taught and that he could grow traders like they grow turtles in turtle farms in Singapore. Covel does a great job of telling the story and even provides the original Turtle Trading rules that Dennis taught his traders.
The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets takes some trend following principles and applies them to an investment framework and timeframe. Faber goes through an example of how a simple trend following indicator, the 10 month/200 day moving average, can be used to increase reduce portfolio volatility. Faber generates an incredible amount of great content on his blog and his work is the foundation for the Top Performing ETF’s monthly rotation system.
General Trading Books:
An American Hedge Fund: How I Made $2 Million as a Stock Operator & Created a Hedge Fund is an awesome read and that’s probably because Tim Sykes is a really entertaining guy and his story is essential reading because it’s so inspiring. Tim started trading in High School and grew his $13,000 account to around $2 million and began a small cap hedge fund. The thing I really respect about Tim is that he has always been very true to his penny stock niche and he is incredibly successful at what he does. Atta boy.
Market Wizards: Interviews With Top Traders (Wiley Trading). While the link to the left will take you to the original Market Wizards Book, Schwager has several books in his Wizards series and all of them are excellent. Schwager interviews the best professional traders in the world and his interviews reveal a wealth of information about trading strategies and psychology. The first Market Wizards book even has interviews with trend following greats Richard Dennis and Ed Seykota.
How I Made $2,000,000 in the Stock Market is a great book because the story shows how a really simple trading system can produce outstanding results. Darvas had a simple system of boxes that he used to trade stocks. He made all of his money without sitting and monitoring the markets all day and even used telegraphs for price alerts (yes, it takes place a while ago). His story is similar to Tim Sykes in that they both started with relatively small stakes and grew those stakes significantly.