Reminiscences of a stock operator, by Edwin Lefevre is one of the most widely read and recommended books on trading. The book written in a biographical form, informs the reader of one of the greatest traders' of his time, Jesse Livermore, talks about his development as a trader. The mistakes made by Jesse in his earlier trading days are some of the most common ones experienced by all traders at some point of their growth curve. Though the book was first published in 1923 and talks about the US stocks and commodities markets in the earlier years of the century, the general conditions still hold true. The book is full of interesting trading incidents in the life of Jesse and is focussed to trading and rarely diverts from the topic.

`Reminiscences...' has been considered a text book for beginners and novice traders, as it offers some very important tips and factsof trading. Take for example the basic assumption of technical analysis: `A lesson I learned early is that there is nothing new in the Wall Street. There can't be because speculation is as old as the hills. Whatever happens in the stock market today has happened before and will happen again.' The book warns a trader about the perils involved in trading and speculating and says that it is a full time and a risky job. Some interesting quotes in the book highlight this point. `The game (trading) taught me the game, and it didn't spare the rod while teaching.' `There is nothing like losing all you have in the world for teaching you what not to do. And when you know what not to do in order not to lose money, you begin to learn what to do in order to win.'

In the initial stages the book highlights the importance of tape reading very forcefully as is clear from the following quotes: `There is always a reason for fluctuations, but the tape does not concern itself with the why and wherefore. It doesn't go intoexplanations. The reason for what a certain stock does today may not be known for two or three days or weeks or months. But what the dickens does that matter? Your business with the tape is now, not tomorrow. The reason can wait. But you must act instantly or be left behind. `A speculator must concern himself with making money out of the market and not with insisting that the tape must agree with him. Never argue with the tape or ask it for reasons or explanations. Stock market post-mortems don't pay dividend.'

An important point that is highlighted is the urge to be in the market. The book says, `There is the plain fool, who does wrong things all the time everywhere, but there is the Wall Street fool, who thinks he must trade all the time. No man can always have adequate reasons for buying or selling stocks daily or sufficient knowledge to make his play an intelligent one.' Jesse lets into his secret of winning by saying that `It never was my thinking that made big money for me. It always was my sitting.'Jesse was broke more than once before he made it big, however all he has to say is `There is nothing like losing all you have in the world for teaching you what not to do. And when you know what not to do in order not to lose money, you begin to learn what to do in order to win.' As he succeeds Jesse is transformed from a short term tape reader to a trend follower and a `market reader'. All a man needs to know to make money is appraise conditions, he says. `The big money was not in the individual fluctuations but in the main movement that is, not in reading the tape but in sizing up the entire market and its trend', brings forward the point. The book brings to light the important characteristics of a trader. `Observation, experience, memory and mathematics; these are what the successful trader must depend on. He must not only observe carefully, but remember at all times what he has observed. He cannot bet on the unreasonable or on the unexpected, however, strong his personal conviction maybe. He must betalways on probabilities, that is, try to anticipate them. Years of practice at the game of constant study, of always remembering, enable the trader to act on the instant when the unexpected happens as well as when the expected comes to pass.'

An important virtue that has been highlighted in the book is the willingness to accept defeat and to learn from these defeats: `If I hadn't made money some of the time I would have acquired market wisdom quicker.'