Way of the Turtle
Way of the Turtle details the story and methods of the famed “Turtle Traders” from one of the members of the original group. This was the first book I read on mechanical trading and opened my eyes to the possibilities of trend following systems. It is an enjoyable and engaging read. Highly recommended!
The Universal Principles of Successful Trading
The Universal Principles of Successful Trading is an absolute must read for anyone beginning trading or experienced alike. Though I don’t agree with all of Penfold’s assertions, the core teachings in this book are spot on. Too many of us go down the never ending road of searching for that next best indicator when the true “Holy Grail” in trading is the combination of methodology, money management, and psychology.
Mechanical Trading Systems: Pairing Trader Psychology with Technical Analysis
Mechanical Trading Systems: Pairing Trader Psychology with Technical Analysis examines the development process for choosing and using mechanical trading systems in conjunction with trader psychology. This book discusses the advantages and disadvantages of mechanical trading systems; the dangers in system development and how to avoid them; the optimal methods for back-testing trading systems; position sizing and other risk quantification tools; and methods of improving rates of return on investments without significantly increasing risk. Most importantly, through a detailed examination of various types of unsuccessful trader personality traits (e.g., fearfulness, greed, and impatience), the book recommends different types of trading systems for a diverse array of trader types. This is my favorite book on mechanical trading.
I have purchased countless books on options and option trading over the years. The majority seem to take the same textbook like approach to teaching options – long on theory with little practical application and trading methodology. This series of books from Random Walk is quite different. Yes, the theory is still there, but it is presented as a foundation for understanding the remainder of the books which are devoted to trading and focus on specific step-by-step trading plans.
One Strategy for all Markets
One Strategy for All Markets focuses on the theory and application of the Broken Wing Butterfly (BWB) option trade. The strategy itself is described and then a concrete trading plan is laid out clearly describing the entry, maintenance, and exit of the position. I consider the BWB as my “core” strategy when trading options as it offers little risk and steady income.
Time Spreads
Due to their simple construction and low maintenance, time spreads (a.k.a. calendar spreads) are some of the most widely used strategies in the options world. This manual offers step-by-step instruction on how to place and manage long and short time spreads in order to maximize the effect that time decay and volatility have on the positions.
Stock, Options, and Collars
This easy to understand manual is perfect for everyone, from those who are just starting out in options to the most sophisticated traders. Learn to properly hedge your entire portfolio of stocks and mutual funds with index options. Step-by-step techniques are presented which will guide you to find the perfect hedge and collar.
Also On My Bookshelf
 
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Hi Eric – this is great list, another book I’d recommend is the classic from Edwin Lefevre: Reminiscences of a Stock Operator
Another book I have found to be very insightful is from Gransville, Gransville’s New Strategy of Daily Stock Market Timing for Maximum Profit, 1976. It is out of print, but good copies are for sale in the used book section of Amazon. His main indicator is On Balance Volume and he believs that volume precedes price.