What if you could turn $30K into $80 million in ten years? That’s the mind-blowing achievement of Michael Marcus, one of the most legendary traders of our time. He’s a veritable gold mine of insights on the craft and science of trading.
In this article, I’ll share 19 of Marcus’ most insightful trading quotes. They span a range of invaluable topics, from risk management and psychology to strategy and discipline. This trader’s powerful words will fire you up, push your boundaries, and sharpen your trading strategies. If it’s generational wealth you seek, you won’t want to miss out on Marcus’ top-notch advice!
1. “Being a successful trader also takes courage: the courage to try, the courage to fail, the courage to succeed, and the courage to keep on going when the going gets tough.”
Michael Marcus reminds us that first, you need the audacity to take risks and plunge into the unpredictable world of trading. Second, you must have the fortitude to face and learn from failure, an inevitable part of the journey. Third, you need the boldness to taste success without becoming complacent. And finally, you need the tenacity to keep pushing forward, even when the market throws curveballs your way.
This nugget of wisdom teaches traders that success isn’t a one-hit-wonder. It’s about resilience, intelligent risk-taking, learning from setbacks, and never giving up. So, if you want to see your profits soar, don’t let losses or tough times knock you down. Instead, seize them as golden opportunities to learn, evolve, and return stronger.
2. “Perhaps the most important rule is to hold on to your winners and cut your losers. Both are equally important. If you don’t stay with your winners, you are not going to be able to pay for the losers.”
Michael Marcus underscores the vitality of careful portfolio management in trading. His golden nugget of wisdom? The trick is to let profitable trades flourish while swiftly bidding farewell to the underperformers.
Why? Because the profits from your winning trades can counterbalance the losses from the duds. Just look at Marcus’ track record trading commodities: in 1970, he rode the profit wave of corn, wheat, and soybeans, then cut his losses just before their prices dipped. This move earned him a whopping $30,000! And according to Marcus, this was a lot of money for a trader from a middle-class background with a modest sum of cash.
So what’s the lesson? Patience is vital in profitable trades, but don’t be fooled into holding on to the losers, hoping for a turnaround. Remember: in the thrilling game of trading, it’s all about knowing when to hold ’em and when to fold ’em.
3. “I think the leading cause of financial disablement is the belief that you can rely on the experts to help you. Investing requires an intense personal involvement.”
Michael Marcus hammers home the need for a personal touch in trading. He warns that relying too strongly on other’s opinions could spell disaster in the financial world. Instead, he champions the idea of rolling up your sleeves and making your own trading strategy.
This means bucking the trend of mindlessly following ‘expert advice.’ It’s about doing your homework, understanding the market, and making intelligent, informed decisions. The potential payoff? Greater profits. With a deeper understanding of your trades, you’ll be quicker on the draw when the market shifts.
4. “Every trader has strengths and weaknesses. Some are good holders of winners, but may hold their losers a little too long. Others may cut their winners a little short, but are quick to take their losses.”
Discover the vibrant spectrum of trading strategies, each with unique strengths and weaknesses. Some traders have mastered the art of clutching onto winning stocks, amplifying their profits and helping them grow generational wealth. However, these same traders may hold on to duds for too long, causing losses and financial wounds.
On the other hand, some traders may cut their losses swiftly on bad stocks but also prematurely sell promising stocks, forfeiting potential profits.
The key here, as Michael Marcus points out, is balance. As a trader, your goal should be to clutch onto your winning stocks just long enough to squeeze out every drop of profit while also being primed to sell losers at the first sign of disaster. This delicate equilibrium can catapult your earnings and grow your bank account.
5. “As long as you stick to your own style, you get the good and bad in your own approach. When you try to incorporate someone else’s style, you often wind up with the worst of both styles. I’ve done that a lot.”
Michael Marcus underscores the value of honing and adhering to your unique trading style. Beware! Blending different trading styles can backfire, giving you a cocktail of the worst parts of each.
So, traders, pay attention! Sharpen your strategies, know your strengths and weaknesses, and resist copying others’ methods. Marcus himself preferred to stick to a trend-following system based on numbers and logic. This focus can turbocharge your trading decisions, catapulting your profits sky-high.
It’s about celebrating your individuality and boosting your confidence in your trading prowess. Watch out for the trap of imitation; it’s not your friend.
6. “Always bet less than 5 percent of your money on any one idea. That way you can be wrong more than twenty times; it will take you a long time to lose your money.”
Market wizard Michael Marcus recommends never staking more than 5% of your total capital on a single idea. This savvy strategy is about safeguarding your trading longevity while keeping risk in check.
Think about it. If a trade tanks, you’re only down a small fraction of your capital. This leaves you with plenty of backup for future trades. It’s a strategy that champions diversification and warns against putting all your eggs in one single basket. You’re boosting your odds of hitting the jackpot by sprinkling your capital across various trades.
This is a wake-up call to all traders: risk management isn’t just important; it’s essential for long-term trading triumph. It’s not just about making money; it’s about keeping it, growing it, and thriving in the unpredictable world of trading.
7. “Mathematics is the supreme nostalgia of our time.”
Michael Marcus paints a riveting picture of mathematics as the ultimate time-traveling tool. It’s a universal language that zips across timelines, offering us a glimpse into the past, a grip on the present, and a roadmap to the future.
Traders, buckle up! With the power of math, you can crack the code of market trends, forecast future shifts, and make razor-sharp trading decisions. Embrace the magic of numbers, and you’ll navigate the rollercoaster world of trading with the precision of a hawk and the confidence of a lion.
8. “I think to be in the upper echelon of successful traders requires an innate skill, a gift. It’s just like being a great violinist. But to be a competent trader and make money is a skill you can learn.”
Michael Marcus believes that, like a virtuoso violinist, top-notch traders have a dash of natural talent. It’s something they’re born with that sets them apart. But don’t feel discouraged if trading doesn’t come naturally to you! Marcus insists that the toolkit to become a profitable trader is learnable.
This means that with a solid dose of grit, a thirst for knowledge, and a sprinkle of practice, you can master the art of trading. So, don’t sweat it if you’re not striking gold immediately. Instead, channel that energy into honing your strategies and expanding your trading know-how.
9. “I look for confirmation from the chart, the fundamentals, and the market action. I think you can trade anything in the world that way.
Michael Marcus champions a comprehensive trading approach. He insists traders shouldn’t be tunnel-visioned, relying on a single information source. Instead, they should mix and match various methods to help them follow market trends.
Let’s break it down. The chart from this quote symbolizes technical analysis, a deep dive into price patterns and trends. Fundamentals? That’s all about dissecting economic influencers like inflation, interest rates, or earnings. Market action? It’s the market’s pulse, the participants’ collective heartbeat.
Marcus suggests mastering and weaving these three elements can supercharge your trading decisions.
10. “In the final analysis, you need to have the courage to hold the position and take the risk. You need to be aware that the world is very sophisticated and always ask yourself: ‘How many people are left to act on this particular idea?’ You have to consider whether the market has already discounted your idea.”
Michael Marcus firmly believes in the power of boldness and audacity in trading. He urges traders to stick to their guns and embrace calculated risks. He also highlights the intricate labyrinth that is the market, pushing traders to question the freshness of their strategies continually.
So before making a trade, ask yourself: how many other traders are doing the same thing? Has the market already adjusted?
This wisdom pushes traders to flex their critical thinking muscles, ensuring your decisions are not solely hitched to market trends but also to the originality and timing of your strategies. After all, if everyone hops on the same bandwagon simultaneously, it could send your plan spiraling.
11. “Ed Seykota is a genius and a great trader who has been phenomenally successful . . . Ed provided an excellent role model.”
This quote from Michael Marcus underscores the power of having a top-notch mentor. Marcus was lucky enough to learn from Ed Seykota, the godfather of automated trading. Marcus was blown away by Seykota’s knowledge and even begged him for a chance to work under his tutelage.
Guided by Seykota’s wisdom, Marcus transformed a modest $5,000 into a staggering $150,000,000. This story serves as a testament to the transformative power of excellent mentorship.
The lesson? Always be self-reliant, but don’t be afraid to consider advice from other market wizards who’ve got it all figured out. After all, that’s why you’re here, isn’t it?
12. “First, the fundamentals should suggest that there is an imbalance of supply and demand, which could result in a major move. Second, the chart must show that the market is moving in the direction that the fundamentals suggest. Third, when news comes out, the market should act in a way that reflects the right psychological tone.”
Once again, Michael Marcus urges you to dive deep into the world of trading, stressing the vital role of market fundamentals, technical analysis, and market psychology. He nudges you to uncover potential game-changing moves through the lens of supply-demand shifts.
First of all, watch the price of a stock. Is it dancing to the rhythm of the fundamentals? If yes, look for a nod from the technical chart analysis. Now, let’s talk about the news. How is the market reacting? Is it a predictable emotional response?
Marcus encourages you to weave these three threads – fundamentals, technical analysis, and market sentiment – into a powerful trading decision-making tool. This fusion bolsters your trades with robust fundamentals and technical support and ensures they’re in sync with the market’s mood.
13. “If a position doesn’t feel right as soon as you put it on, don’t be embarrassed to change your mind and get right out. If you become unsure about a position, and you don’t know what to do, just get out.”
Legendary commodities trader, Michael Marcus, shares a priceless nugget of wisdom for traders: Trust your gut! If a trade starts to feel off right after you’ve made it, don’t hesitate or feel sheepish about exiting.
He insists, if you’re not 100% sure about a position, bolt! And this advice isn’t just golden; it’s platinum. It nudges traders to rely on their intuition and act decisively, which could be the secret to avoiding unnecessary losses. Plus, it underscores the vital art of risk management and the comfort in owning your trading decisions.
14. “If we saw a surprise price move against us that we didn’t understand, we often got out and looked for the reason later.”
In this quote, trading titan Michael Marcus underscores the power of lightning-fast action. He hints that when the market throws a curveball, he’d rather dodge it first, limiting any potential damage. The ‘why’ behind the market’s wild swing can wait until later.
This sends a clear message – while understanding your trades is vital, being quick to react to market changes is even more critical. In essence, Marcus places risk management and split-second response at the top of his priority list, leaving analysis for when the dust settles.
The takeaway? When things start to go wrong, run! You can always look back later.
15. “The best trades are the ones in which you have all three things going for you: fundamentals, technicals, and market tone.”
This quote by trading wizard Michael Marcus once again reveals the secret recipe to successful trading: a deep dive into fundamentals, technicals, and market tone.
So what can we do before entering a position? Analyze a company’s fundamentals, the economic ingredients that spice up a security’s value. Think of macroeconomic data or company profit reports. We should also perform careful technical analysis, which involves decoding market trends through statistics. Picture analyzing price shifts and trading volumes.
And then we have to pay attention to the market tone by analyzing news events, societal trends, and political shifts. If we pay attention to these three things, we’ll make more profitable trades in no time!
16. “I don’t trade the Dow stocks. I prefer the little ones because they are not dominated by the big professional traders who are like sharks eating each other.”
Michael Marcus has a hot tip for you – shift your gaze from Dow stocks to smaller stocks. Why? It’s simple. The Dow stocks (i.e. Intel Corp, Coca Cola, Johnson & Johnson) are like a shark tank, filled with big, professional traders all vying for the same prize. It’s a tough, competitive battleground that can be challenging to navigate, especially for the smaller traders.
So, where should you be looking instead? Smaller stocks. These less popular options are often overlooked, offering you a chance to sidestep the fierce competition and uncover hidden gems.
By diversifying your portfolio and including these smaller stocks, you’re stepping out of the shark tank and into a pool of potential profits waiting to be discovered. By capitalizing on these overlooked opportunities, you’re opening the door to potentially higher profits.
17. “When the market is active and moving, and then gets quiet, that is often a sign that it is not going to go much further. Also, sometimes when the ring is moderately loud and suddenly gets very loud, instead of being a sign that the market is ready to blast off, as you might think, it actually indicates that the market is running into a greater amount of opposing orders.”
Michael Marcus hints that the buzz of market activity can be a crystal ball into future trends. If a once bustling market starts to hush, it’s often a sign that big moves are unlikely on the horizon. Likewise, a sudden surge in market chatter doesn’t always signal a skyrocketing rise; it might just mean the market is hitting a brick wall of resistance.
So what’s the lesson here for investors? Monitor market activity closely, as it can indicate future trends. Decreased activity may suggest stability (time to enter), while increased chatter could signify resistance (time to exit.
18. “When I was winning, I tried to hide my elation, and when I was losing, I had to make sure not to let it show on my face. I don’t think anyone ever caught on, but I was in a manic-depressive state throughout that time.”
In his candid chat with Jack Schwager for the iconic book, “Market Wizards,” Marcus spills the beans about his emotional roller coaster during his stint as a research analyst at Reynolds Securities. His trading days were a whirlwind of emotions, a slippery slope that he warns can be treacherous for traders.
The thrill of a winning trade sent Marcus soaring, while a loss plunged him into the depths of despair. A word of caution from Marcus – this emotional yo-yo is a ticking time bomb for traders. Letting your feelings run rampant can trigger a chain reaction of poor trading decisions.
How? A string of losses could bait you into trying to recoup your losses by making several impulsive trades. And according to Marcus, it wasn’t until he overcame the problem of overtrading that his account went from $24,000 to $64,000 within a year.
So, strap on your emotional armor when trading! Embrace losses gracefully and resist the urge to trade driven by FOMO, panic, and greed.
19. “I would sometimes think that maybe I ought to stop trading because it was very painful to keep losing. In ‘Fiddler on the Roof,’ there is a scene where the lead looks up and talks to God. I would look up and say, ‘Am I really that stupid?’ And I seemed to hear a clear answer saying, ‘No, you are not stupid. You just have to keep at it.’”
Michael Marcus explains the power of perseverance in the trading world. In this quote, he remembers a scene from a beloved musical where a character grapples with self-doubt. This resonates with Marcus, who’s faced his fair share of trading tribulations. One memorable debacle? Betting everything on corn and wheat contracts, only to lose a staggering $42,000.
But did he throw in the towel on his trading career? Absolutely not! Every trader will face losses – it’s an inevitable part of the game. The secret sauce? Resilience. It’s about dusting yourself off, learning from your blunders, and coming back stronger and sharper, ready to make money.
Conclusion: Learning from Michael Marcus Quotes
Trading legend Michael Marcus has achieved outstanding market results, multiplying his trading capital by more than 2,600 times in just ten years. This incredible feat alone catapults him into the stratosphere of trading gurus to glean wisdom from.
Marcus’ disciplined, trend-chasing approach to trading is an inspiration to all ambitious traders and investors. By adopting his principles and insights, you can turbocharge your trading performance, sidestep common traps, and carve a path to monumental wealth. I dare you to test-drive Marcus’ brilliant trading strategies and witness their transformative power for yourself!