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“Jeff Augen is truly a unique voice and mind in today’s financial discourse. He has a knack for translating intricate economic and market interrelationships into easy-to-understand ideas and has a way of seeing patterns and cause-effect relationships across markets. For those who listen, there is much to learn and much from which to profit. Ultimately, he gives individuals a fighting chance to participate in the markets to their advantage.”
--Heather Larson-Blakestad, Executive Editor, Stocks, Futures, and Options Magazine
“Jeff is a true scientist who has turned his formidable skills to the markets. His systematic research and open mind have led to a series of insights that are stunningly original and an investment philosophy based on facts, with no time wasted on mere conventional wisdom. Following Jeff’s thinking can help any investor avoid many costly blind alleys and develop a strategy based on how markets actually work.”
--Robert Birnbaum, former hedge fund president
“Jeff Augen reveals the ‘ugly truth’ that everyone investing in the markets needs to hear and also applies the lessons to the real world of trading. He attacks popular myths, notably about whose fault it is when investment decisions lead to losses and who gets credit for being a wise investor. The tie-in between investment/trading strategic thinking and well-explained economic reality is refreshing and extremely valuable.”
--Michael Thomsett, author of Put Option Strategies for Smarter Trading and The Options Trading Body of Knowledge
Today’s financial markets are complex and dangerous. The value of individual investments is now more strongly influenced by world economic and geopolitical events than by the underlying fundamentals of the company being invested in. Layered on this intricate web of forces is the impact of high-frequency computer trading programs that enter and exit trades in a fraction of a second and drive 60% or more of the market volume on any given day. Trading Realities provides investors with new skills and approaches to succeed in this environment. Without this enhanced knowledge, investing is no more than gambling.
Writing for beginning and experienced investors alike, successful trader and author Jeff Augen focuses on the powerful forces that really move markets: the dynamics that are fundamental to your success, no matter which strategies or asset classes you choose. He provides new approaches to identifying market trends, exploiting global economic forces, trading the news, valuing risk, and dissecting economic reports released by the government.
You’ll learn how to gain a clear advantage: an advantage you can sustain through any market environment.
Preface xiii
First Principles 1
Chapter 1: Global Economic Forces and the Average Investor 5
Chapter 2: The Harsh Realities of the Marketplace 23
Chapter 3: Betting with the House 49
Chapter 4: Identifying Trends 63
Chapter 5: A New Era 117
Chapter 6: The Importance of Volatility 155
Chapter 7: Strategies for a New Market 175
Appendix A: Options Primer 225
Index 251
Overview
“Jeff Augen is truly a unique voice and mind in today’s financial discourse. He has a knack for translating intricate economic and market interrelationships into easy-to-understand ideas and has a way of seeing patterns and cause-effect relationships across markets. For those who listen, there is much to learn and much from which to profit. Ultimately, he gives individuals a fighting chance to participate in the markets to their advantage.”
--Heather Larson-Blakestad, Executive Editor, Stocks, Futures, and ...