| What I Like About Nicholas Darvas? | | | | market and why? Question everything and eliminate |
| Where do I start? I consider Nicolas Darvas the BEST | | | | what doesn't work. He pieced together a system that |
| trader, or as he him-self said "investor" in the world. I'll | | | | fitted his personality. The person who can do this will |
| admit one man's poison is another man's medicine. You | | | | be a big winner in the markets. |
| cannot really define what is the world's BEST trader. | | | | Flaws: |
| It's my opinion. | | | | What flaws can the world's best trader have? |
| Why? You must, absolutely MUST, read, re-read, | | | | Actually there is one and it was a very dangerous one. |
| study and think about every line in the book "How I | | | | Money management. Boy was he lucky! Buying a |
| Made $2 Million in the Stock Market". I won't lie when I | | | | 100% position on leverage on one stock could have |
| say I have read it over 100 times and I still read it at | | | | been the death of his account. When he bought 2,500 |
| least once per month. Amazingly I keep learning new | | | | shares, on margin, of E.L Bruce (a small cap un-known |
| points. | | | | stock) IF things had have turned ugly here, i.e. prices |
| Darvas was actually the first CANSLIM trader without | | | | gapped down or fell off very sharply, no doubt Darvas |
| going into the finer points. This may up-set William | | | | would have been finished. Instead of writing a book |
| O'Neal followers. Whilst Darvas did not actually study | | | | about how he made his fortune in the Stock Market |
| earnings, sectors, shares outstanding etc. his off the | | | | he might have written one about how a fortune was |
| cuff stock selection meant he was using CANSLIM | | | | lost. Luckily he made over $300,000 from this |
| methods. Don't forget this was way back in the late | | | | transaction alone. Had he have had some money |
| 1950's. | | | | management rules in place, sure the gains would not |
| He turned $25,000 into $2,25 million by scanning the | | | | have been as big, but at least IF things hadn't have |
| newspapers in just five minutes during the late, night | | | | worked out he could live to fight another day. |
| early morning, period. He him-self said it wasn't so | | | | A number of occasions Darvas "plunged" into the |
| much the amount of money he made that pleased him | | | | market with little thought to money management and |
| but the ease and peace of mind it was achieved. It | | | | risk. Ignorance really was bliss. Jesse Livermore was |
| was SO easy. Admittedly, he was lucky in that he | | | | not quite so lucky. |
| traded his system during a roaring bull market. But his | | | | Conclusion: |
| system makes money in all market conditions. It's just | | | | A shining light of hope to the man on the street that |
| a fact that you'll make a lot more during a run-away | | | | anyone given time, education, desire and determination |
| bull market. That can be said for most systems. | | | | can make BIG money in the stock market. You don't |
| The perfect attitude for trading. When he was wrong | | | | have to have state of the art technology, data, or |
| on a trade he shrugged his shoulders, cut his losses | | | | in-side information to make massive returns. |
| and looked for the next one. No second guessing. No | | | | If Darvas can make $2,25 million by scanning the |
| emotion. No ego involved. He told the reporter who | | | | papers for five minutes before bed what does that |
| interviewed him for a time magazine article he only | | | | say for today's Hi-tech trading techniques? |
| expected to be correct half the time. | | | | His methods still work and always will work. If it stops |
| Without doubt his best quality was his ability to | | | | so will the stock market. |
| question everything. When he was wrong why? What | | | | * * * * 1/2 41/2 Star Trader (P.S. |
| worked and why? What didn't work in the stock | | | | |