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A TAOIST TRADER
Let An Ancient Eastern Philosophy Turn Your Trading Account, and Your Life, From Struggle To Prosperity
Philosophy is just so much nattering
unless you also use what you
discover as a ground for being.
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About the Book
Let us start with a few questions.
Should you decide to become an engineer and design bridges – will the first question you ask be “Where do we put piles in the river’s bottom?”
Should you decide to become a surgeon and perform heart surgeries – will the first question you ask be “Where do we make the first cut?”
Should you decide to become a pilot and fly 747 – will the first question you ask be “Which switch do we flick first?”
Didn’t think so. You will study the principles of design first, to learn how to build bridges. You will learn how the human body works, to understand the illnesses and cures. You will study how the planes work, to learn to operate them. You will also study how the subject of your occupation interacts with an environment – bridge with its load and elements, body with tasks of daily life, plane with atmospheric phenomena.
Seems obvious enough, right? Well, the first question most aspiring traders ask is “Where do we enter and exit our trades?” For some reason, the necessity to study what market is, how it works, what forces move it, how to read their actions, and how to act to achieve success in trading escapes beginner traders, as if it were understood by anyone by default.
Listen to the conversation of two beginners, and the majority of their discussion will be particular stocks or sectors, entries and exits. Listen to the conversation of two traders who survived their first 3 to 5 years, and you will hear very different topics discussed – market philosophy and traders’ psychology. Listen to the conversation of two traders having 15 and more years of trading under their belts, and you will find them discussing… well, dinner menu most likely; their views on the market’s inner workings are likely to be, for all practical intents and purposes, similar.
For as long as I have written about markets and trading, I have emphasized trading philosophy and psychology. Techniques of Tape Reading devotes the whole first part of the book to this topic; The Master Profit Plan starts with a “Trading Philosophy” chapter. For a long while I was looking for the best and most practical way to describe the inner workings of the market and a trader’s behavior in it. The answer dawned on me during a discussion with a good friend and fellow trader Mark (“nemo.”) Trained in the arts and philosophy of an ancient discipline, and seeing parallel ideas in my writing, he saw it fitting (and I am very grateful he did) to introduce me to that philosophy.
Enter the Tao.
According to the philosophy, Tao is the ultimate origin of all things, physical and metaphysical, that operates through principles that can be observed in the world around us. Tao is a law according to which everything happens. Call it Laws of Nature; call it set of rules; call it natural patterns, or call it guiding spirits – whatever your concept for it is, everything we observe is a manifestation of the Tao and functions according to its rules. Yes, that means you and the markets too.
The classic text of Taoism is the Tao Te Ching, written by Lao Tze about 2500 years ago, and is the second most translated book in the world. The book consists of 81 short poems. There is no direct way to accurately understand their meaning, for a few good reasons. The poetic form does not easily lend itself to strict logical concepts and concrete interpretation. The author had not intended the meaning to be easily understood. Finally, translation from Chinese is a subject of interpretations, and a translator without subject matter expertise (in this case without a Taoist master) is prone to error. For the purposes of this book we are using the translation by Lin Yutang; most importantly, for interpretation, we use the excellent works by Grand Master Alex Anatole, The Truth of Tao and The Essence of Tao. By no means should this book be considered the work by which to study Taoism. This is a book applying the Taoist philosophy to trading – for a more comprehensive explanation and understanding of Taoism I’ll direct you to the aforementioned books and Alex’s site The books unfold this amazingly pragmatic philosophy in a logical and elegant way. The reader will undoubtedly be fascinated by the direct practical applications, clarity and delicious paradoxes of the Taoist way of thinking.
Every chapter in this book consists of three parts.
First (in bold italic) is a poem from the Tao Te Ching. We used 44 chapters in our book. 27 of them are the main poems describing vital principles; 17 are supplementary, providing a somewhat different angle, new detail or a refresher.
The second part (in italic) is an explanation of the poem’s basic meaning taken from the works of Grand Master Anatole. Corresponding parts of the poem are recited for clarity. Make sure to read it with great attention. Taoist thinking is not immediately obvious; it relies on paradoxes and is expressed in a way that requires a certain mental adjustment. You will be amazed to see how the meaning of the seemingly vague words turns around and become stunningly clear – when you start thinking as a Taoist.
The third part (in normal font) is the trading application. This is where we turn philosophical abstractions into practical application. What the market is. What your place in it is. What forces move it. How they act. What their motives are. How to read their intentions. How to act to stay safe and profit from the action. How to condition your mind to act in a disciplined cold-blooded fashion. Taoist principles create the canvas that we use to combine these concepts and beliefs in a clear well-structured trading philosophy that governs your actions and gives you inner strength to follow the right course.
Going from chapter to chapter, you will encounter some themes more than once. Some of them are only touched briefly in early poems and expanded in greater details later. Some of them are combined to show their interaction. Some are shown from different angles to demonstrate how they influence various aspects of market action. Don’t rush through the chapters – soak the content in, let it blend together. Gradually, you will sense a whole new outlook being formed; no side of the market will be seen as standalone – instead, it will all come together in amazing clarity. Read the book carefully and apply it methodically – and many confusing aspects of market events will become clear. You will find yourself having unambiguous recipes for your own actions and the ability follow them with resolve and discipline.
The book addresses three major aspects of trading:
- Understanding the inner workings of the market
- Understanding thought process and guiding emotions of other traders
- Understanding and controlling your mindset and actions
You can also get the hard copy of this book HERE
Last comment before moving to the book itself: do not take it as stiff dogma. You may find different analogies or applications for some of the Taoist principles, or think of something better suited to your particular situation. Taoism is nothing if not flexible, and Tao is bigger than any of us. As long as you comply with natural laws, such modifications constitute finding your own niche and can only be commended.
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THIS BOOK IS ALSO A PART OF OUR A TAOIST TRADER COURSE
The Taoist Trader has changed my life and that is not an exaggeration. From being a helpless sheep ready to be fleeced at Wall Streets will, Taoist Trader has changed the way that I not only see and react towards the market, but all elements of human behaviour - and that is a valuable gift. This learning is not for everyone. Internalising positive change is difficult in a world manipulated by frequent news panic that plays upon the emotional response of the investing crowd; we all want to identify ourselves with the majority and that is normal. But the Taoist Trader taught me to stop pointing the finger at others and faulting them for my own failures. Instead I have learned to change myself and in doing so, I am no longer subject to the emotional exploitation that is our financial and political elites' modus operandi. If you're ready to change yourself, then you've come to the right place. Combine The Taoist Trader with Vad's Techniques of Tape Reading and you have some very powerful tools for navigating the market successfully.
- Les R.., Switzerland
Wow, Trader's Routines... wow, exactly my issues listed and described, as if you looked over my shoulder! I'll admit, I was a bit impatient and jumped over some parts to read this. Now, going back and reading the chapters that led to this attachment, I am amazed by the structure and logic, and how practical it all is. At the same time, it's completely different look at everything trading related. I am rethinking a lot of things that just yesterday seemed so obvious... This Taoist Trader course changes everything to me it seems
- Peter S., ON
I want to thank you for compiling your appreciation of the Tao on this magnificent course. I am a speed reader and in average I read 2-3 books a week. On this e-book I am taking all the time in the World so I can let your writings sink in and and simmer and take shape within me.
I still cannot believe the wealth of knowledge and wisdom packed in what I have read so far. One thing that I have been contemplating is the colossal depth of each essay. In my personal library you will find the entire collection of i.e David Hawkins and Wayne Dyer to mention just a couple of great spiritual writers and your course stands on its own right next to these two great authors.
I believe that many will read this e-book and it might not make sense at first. One most definitely should be at a specific consciousness level in order for your work to make profound effect and at the same time I can tell that your book can be read 100 times and one will find a different meaning every single time its read...
- Al Hernandez, Atlanta, GA, March 2011
About me so you know where I am coming from. I am what you can call disgruntled investor. Buy and hold for years my entire life, you know... common sense stock picking, economy, monetary policy, fundamentals, some technical analysis, listening to broker, reading newsletters... You get the picture, and if you are anything like me, you know what kind of hits we took over last few years. I's like nothing makes sense anymore... so I started trying to take things in my hands more and make my own decisions, evaluating "gurus" more critically. The learning curve is nothing short of astonishing, I must say.
In my quest for knowledge I found this course and it felt like something from which I could benefit. I wasn't disappointed at all. Many things in the markets that didn't make sense to me suddenly do now. I see clearly what errors I made as an investor and how I was led to those errors by dishonest or not too knowledgeable "gurus." To be sure, not blaming anyone - it was my stupidity that killed me... but it feels so rewarding now, to see what I did wrong and to be able to correct things. I am sure I have a long way ahead of me but this course put in a solid foundation. Most of all, I now have clear criteria by which I can evaluate all the information provided by the market and media, and chart my own course.
- Nestor V., NY
Must confess, I was a bit hesitant about this course. I mean, Taoism? Trading? Sounds a little gimmicky... Boy, was I wrong. This course is every bit as parctical as Vadym's two books (they were the reason I still decided to give the course a try, since I liked both very much). My main concern has been that the material would be abstract and not really connected to everyday experience. Nothing even close - page after page of down to earth practical advice, explanation of things we encounter daily and direct unambiguous help in dealing with them. Very very powerful writing. I am sure I will discover new gems as I return to this course over time.
- J.R., Fla
The Tao Te Ching is a book of philosophy written by Lao Tzu in China more than 2500 years ago during the time and vicinity of Confucious. As a foundational philosophy it offers a world view but also gives practical advice for the individual to align their behavior to the ways of the world and act accordingly.
In A Taoist Trader Vadym Graifer succinctly and effectively exposes and explains the Tao Te Ching while likewise tieing it to the financial markets. This is a practical teaching text that can appeal to all ages and competencies of any market participant. Affirmation of successful individual behavior can be seen as well as destructive behaviour laid bare. Numerous poignant analogies strike home that are stunning in clarity.
This book will make you a better trader. It will put a top spin on trading performance by its practical, real world and often occurring, situational illustrations that will cut the number and size of losses while giving the trader the personal and actionable basis to make consistent gains.
Many are offered The Way. Few choose to see it, and fewer still choose to follow it. This book is a real opportunity.
- Ron S., Colorado
A Taoist Trader course is incredibly clear and powerful. Like no other trading related book I've ever read, it creates whole mindset, puts everything together and allows me to see the market as a mechanism in which everything makes sense. My place and behavior is defined with such clarity, I have much more control over myself and have no troubles executing my trading decisions. Emotions seem to have no more influence on me.
- L.B., Michigan
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