--- title: "Trading Quotes To Know And Live By · MomoX3" description: "Sixty quotes from the traders and investors who lasted, on cutting losses, patience, discipline, sizing and the mind. Each one checked against the original source, with how to apply it as a trader. Plus the famous lines they never said." canonical: https://www.momox.io/quotes --- [MOMOX3](https://www.momox.io/)quotes 💬 # Trading Quotes To Know And Live By 60 lines from the traders and investors who lasted, grouped by the lesson they teach: cutting losses, waiting, rules, letting winners run, being wrong, the mind, size, process, the crowd, preparation and the losing streaks. Under each one, a 💡 line: how to use it as a trader of SPY and QQQ options today. CONTENTS (12) THEME 1 ## Risk & cutting losses The first rule almost every trader on this page names: keep the loss small and you stay in the game. “The elements of good trading are: (1) cutting losses, (2) cutting losses, and (3) cutting losses. If you can follow these three rules, you may have a chance.” **Ed Seykota** · *Market Wizards*, 1989 💡 The exit is decided before the entry. No stop written down, no trade. “Every day I assume every position I have is wrong. I know where my stop risk points are going to be.” **Paul Tudor Jones** · *Market Wizards*, 1989 💡 Before you enter, name the price that proves the idea wrong. That price is the stop, not a pain point in dollars. “A loss never bothers me after I take it. I forget it overnight. But being wrong—not taking the loss—that is what does the damage to the pocketbook and to the soul.” **Edwin Lefèvre** · *Reminiscences of a Stock Operator*, 1923 💡 The loss you took is finished. The loss you are still holding is the danger. Close it and the head clears. “Profits always take care of themselves, but losses never do.” **Jesse Livermore** · *How to Trade in Stocks*, 1940 💡 Spend your attention on the losing trade. The winning one only needs its exit rule. “The whole secret to winning big in the stock market is not to be right all the time, but to lose the least amount possible when you’re wrong.” **William O’Neil** · *How to Make Money in Stocks, 4th ed.*, 2009 💡 Keep every loss about the same small size and let the wins vary. Then being right less than half the time is fine. “My philosophy is strong opinions, weakly held. The minute a trade reaches into my pocket, it becomes a weakly held position, and I’ll drop it like a hot potato.” **Peter Brandt** · *Unknown Market Wizards*, 2020 💡 Take the setup with conviction, and drop it the moment price closes against the level it depended on. THEME 2 ## Patience & waiting The money is made in a few good moments. The skill is the waiting between them. “It never was my thinking that made the big money for me. It was always my sitting. Got that? My sitting tight!” **Edwin Lefèvre** · *Reminiscences of a Stock Operator*, 1923 💡 Once a trade on a trend day is working, the hard job is doing nothing until your exit rule fires. “There is the plain fool, who does the wrong thing at all times everywhere, but there is the Wall Street fool, who thinks he must trade all the time.” **Edwin Lefèvre** · *Reminiscences of a Stock Operator*, 1923 💡 Set a cap on trades for the day. A day with no setup is a valid trading day. “Whenever I have had the patience to wait for the market to arrive at what I call a ‘Pivotal Point’ before I started to trade, I have always made money in my operations.” **Jesse Livermore** · *How to Trade in Stocks*, 1940 💡 Let price come to the level you marked before the open. Enter at the level, not halfway to it. “I just wait until there is money lying in the corner, and all I have to do is go over there and pick it up. I do nothing in the meantime.” **Jim Rogers** · *Market Wizards*, 1989 💡 A clean setup at a level you planned is the money in the corner. Everything else is waiting. “We find doing nothing the most difficult task of all.” **Warren Buffett** · Berkshire Hathaway shareholder letter, 1984 💡 Sitting flat through a choppy hour is a skill. Expect it to feel bad, and do it anyway. THEME 3 ## Discipline & rules Rules are easy to write and hard to keep. The traders who lasted kept theirs on the bad days too. “I always say that you could publish trading rules in the newspaper and no one would follow them. The key is consistency and discipline.” **Richard Dennis** · *Market Wizards*, 1989 💡 Most traders know the rules. The edge is following them on the twentieth trade exactly as on the first. “Anyone who is inclined to speculate should look at speculation as a business and treat it as such and not regard it as a pure gamble…” **Jesse Livermore** · *How to Trade in Stocks*, 1940 💡 A business has hours, a budget and books. So does trading: a time window, a max daily loss, a journal. “You better have a plan ahead of time and it better be self-executing” **Paul Tudor Jones** · *Invest Like the Best* podcast, 2026 💡 On a big-news morning (CPI, the Fed), the exit order is in before the number comes out, not typed after it. “A man must believe in himself and his judgment if he expects to make a living at this game. That is why I don’t believe in tips.” **Edwin Lefèvre** · *Reminiscences of a Stock Operator*, 1923 💡 A call from a chat room is not your setup. If you can’t name your own stop for it, skip it. “The one thing you can control is yourself.” **Mark Douglas** · *The Disciplined Trader*, 1990 💡 You control your size, your stop and whether you click. The next candle is not yours. THEME 4 ## Trend & letting winners run Cutting losses is half of it. The other half is not cutting the winners. “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** · *Market Wizards*, 1989 💡 On a trend day, keep part of the position on. That runner is what pays for the small losses. “…prices, like everything else, move along the line of least resistance.” **Edwin Lefèvre** · *Reminiscences of a Stock Operator*, 1923 💡 Trade the side the trend is already taking. Don’t fight the easy direction. “They say you never grow poor taking profits. No, you don’t. But neither do you grow rich taking a four-point profit in a bull market.” **Edwin Lefèvre** · *Reminiscences of a Stock Operator*, 1923 💡 Take some profit at the first level, and leave a piece for the trend to carry. “While amateurs go broke by taking large losses, professionals go broke by taking small profits.” **William Eckhardt** · *The New Market Wizards*, 1992 💡 If your average winner is smaller than your average loser, the fix is the exit, not more trades. “I’m always going to be a trend trader. I’m always going to follow the momentum” **Paul Tudor Jones** · Bloomberg interview, 2025 💡 When momentum and your opinion disagree, momentum gets the vote. “Some people automatically sell the “winners” … and hold on to their “losers” … which is about as sensible as pulling out the flowers and watering the weeds.” **Peter Lynch** · *One Up on Wall Street*, 1989 💡 Selling the winner early and holding the loser is backwards. Cut the loser at the stop, and let the winner’s rule decide. THEME 5 ## Humility & being wrong Nobody on this page was right all the time. They were wrong quickly and cheaply. “Don’t be a hero. Don’t have an ego. Always question yourself and your ability. Don’t ever feel that you are very good. The second you do, you are dead.” **Paul Tudor Jones** · *Market Wizards*, 1989 💡 After a big green week, keep the size where it was. “Markets are never wrong—opinions often are.” **Jesse Livermore** · *How to Trade in Stocks*, 1940 💡 If price ignores your idea, the idea is what’s wrong. “My approach works not by making valid predictions but by allowing me to correct false ones.” **George Soros** · *The Alchemy of Finance*, 1987 💡 The morning plan is a guess with exits. The edge is how fast you correct it. “…I’ll always make mistakes. I just try to make them less frequently, recognize them faster, and correct them immediately!” **Linda Raschke** · *The New Market Wizards*, 1992 💡 The goal is shorter mistakes, not zero mistakes. “There is no harm in being sometimes wrong — especially if one is promptly found out.” **John Maynard Keynes** · *Essays in Biography*, 1933 💡 A stop finds you out in minutes. Being wrong is cheap when it’s found fast, and expensive when you hide from it. THEME 6 ## Emotions & psychology The chart rarely beats a trader. Hope, fear and the urge to act do. “Instead of hoping he must fear; instead of fearing he must hope. He must fear that his loss may develop into a much bigger loss, and hope that his profit may become a big profit.” **Edwin Lefèvre** · *Reminiscences of a Stock Operator*, 1923 💡 Flip the instinct: fear the losing position, hope on the winning one. “The consistency you seek is in your mind, not in the markets.” **Mark Douglas** · *Trading in the Zone*, 2000 💡 The market won’t get more predictable. Your execution can. “I didn’t learn anything. I already knew that I wasn’t supposed to do that. I was just an emotional basket case and couldn’t help myself.” **Stanley Druckenmiller** · Lost Tree Club talk, 2015 💡 Knowing better doesn’t stop the chase. A hard rule written in advance does. “A person who has not made peace with his losses is likely to accept gambles that would be unacceptable to him otherwise.” **Daniel Kahneman & Amos Tversky** · “Prospect Theory,” *Econometrica*, 1979 💡 After a red morning, the long-shot contract you would never buy at the open starts to look good. That pull is the sign to stop for the day. “Speculation is most dangerous when it looks easiest.” **Warren Buffett** · Berkshire Hathaway shareholder letter, 2000 💡 Three easy wins in a row is when size creeps up. Hold the size. **See it on a live chart:** the free class reads one SPY session, level by level, every other Wednesday at 8:00 PM ET. [Save a free seat →](https://www.momox.io/class?utm_source=site&utm_medium=quotes) THEME 7 ## Sizing & survival You can’t trade tomorrow with an account you lost today. Size is the first defense. “Undertrade, undertrade, undertrade is my second piece of advice. Whatever you think your position ought to be, cut it at least in half.” **Bruce Kovner** · *Market Wizards*, 1989 💡 New to options? Trade the smallest size until your journal shows twenty trades taken by the plan. “When I am trading poorly, I keep reducing my position size. That way, I will be trading my smallest position size when my trading is worst.” **Paul Tudor Jones** · *Market Wizards*, 1989 💡 Two red days in a row: half size until a green one. “The way to build long term returns is through preservation of capital and home runs.” **Stanley Druckenmiller, on a philosophy he took from George Soros** · *The New Market Wizards*, 1992 💡 Small on ordinary days. Bigger only on the rare day everything lines up, and still inside your max risk. “A long string of impressive numbers multiplied by a single zero always equals zero.” **Warren Buffett** · Berkshire Hathaway shareholder letter, 2005 💡 Twenty green days don’t survive one account-ending day. Size so no single day can be the zero. “Never forget the six-foot-tall man who drowned crossing the stream that was five feet deep on average.” **Howard Marks** · Oaktree memo “Pigweed,” 2006 💡 An average day’s range says nothing about today’s worst minute. Size for the deep spot. “If I had to summarize money success in a single word it would be “survival.”” **Morgan Housel** · *The Psychology of Money*, 2020 💡 Still trading next month is the first goal. Profit comes second. THEME 8 ## Process over outcome One trade tells you almost nothing. A hundred trades taken the same way tell you everything. “…it’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong.” **Stanley Druckenmiller, on the lesson he took from George Soros** · *The New Market Wizards*, 1992 💡 Track your average win and your average loss. The win rate alone lies. “You don’t need to know what is going to happen next in order to make money.” **Mark Douglas** · *Trading in the Zone*, 2000 💡 You need a stop, a target and an edge, not a forecast for the close. “An edge is nothing more than an indication of a higher probability of one thing happening over another.” **Mark Douglas** · *Trading in the Zone*, 2000 💡 A good setup tilts the odds. It doesn’t promise the trade. “The goal of a successful trader is to make the best trades. Money is secondary.” **Alexander Elder** · *Trading for a Living*, 1993 💡 Grade each trade on how well you followed the plan. The money follows the well-made trades. “The correctness of a decision can’t be judged from the outcome.” **Howard Marks** · Oaktree memo “Getting Lucky,” 2014 💡 Two columns in the journal: did I follow the plan, and what did it make. Read the first one first. “If a method is truly valid, you should be able to explain it to a computer.” **William Eckhardt** · *The New Market Wizards*, 1992 💡 If you can’t write your entry rule in one sentence, you’ll trade it differently every day. THEME 9 ## Crowd & contrarian The crowd is information, not instruction. Know where it stands before you stand with it. “…there is nothing new in Wall Street. There can’t be because speculation is as old as the hills. Whatever happens in the stock market to-day has happened before and will happen again.” **Edwin Lefèvre** · *Reminiscences of a Stock Operator*, 1923 💡 Today’s squeeze or pin looks like one you’ve seen before. Your journal is where you find it. “We devote our intelligences to anticipating what average opinion expects the average opinion to be.” **John Maynard Keynes** · *The General Theory*, 1936 💡 The obvious levels work partly because everyone watches them. Watch where the crowd expects the crowd to act. “Some of the best trades come when everyone gets very panicky. The crowd can often act very stupidly in the markets.” **Linda Raschke** · *The New Market Wizards*, 1992 💡 A panic flush into a known support level, then a reversal, is where the panic trade pays. “We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.” **Warren Buffett** · Berkshire Hathaway shareholder letter, 1986 💡 An investor’s rule, built for months, not minutes. Intraday, fear spiking into a level you planned is where a reversal can set up; fading a strong trend on a feeling is not this rule. “If you buy the same securities everyone else is buying, you will have the same results as everyone else.” **John Templeton** · “16 Rules for Investment Success,” 1993 💡 The same entry as the whole chat room gets the same slippage and the same stop-run. THEME 10 ## Preparation & edge The edge is built before the open: the levels, the calendar, the plan for both directions. “The tape tells the news minutes, hours and days before the news tickers, or newspapers, and before it can become current gossip.” **Richard D. Wyckoff** · *Studies in Tape Reading*, 1910 💡 A sudden burst of volume at a level is often the news before the headline. “The chart is what will give you money or take money from you, so it is the only thing that you should ever consider when trading.” **Al Brooks** · *Reading Price Charts Bar by Bar*, 2009 💡 Opinions, headlines and your P&L are noise next to the bar in front of you. “You Can’t Predict. You Can Prepare.” **Howard Marks** · Oaktree memo title, 2001 💡 A daily plan is not a forecast. It is what you do at each level, in both directions. “It isn’t the charts that give me my edge; it’s risk management. I get an edge from discipline, patience, and order execution.” **Peter Brandt** · *Unknown Market Wizards*, 2020 💡 Two traders, same chart. The one with the written plan and the stop usually comes out ahead. “There are two parts to a trade: direction and timing. And, if you’re wrong about either one, you’re wrong on the trade.” **Dan Markey, as quoted by Peter Brandt** · *Unknown Market Wizards*, 2020 💡 With options, time is a cost. The right direction too late is still a losing contract. “Predicting rain doesn’t count, building arks does.” **Warren Buffett** · Berkshire Hathaway shareholder letter, 1981 💡 Calling the CPI move doesn’t count. Having a plan for both outcomes does. THEME 11 ## Losing streaks & drawdowns Every trader has them. The ones who lasted got smaller during them, not bigger. “I handle losing streaks by trimming down my activity. I just wait it out. Trying to trade during a losing streak is emotionally devastating. Trying to play ‘catch up’ is lethal.” **Ed Seykota** · *Market Wizards*, 1989 💡 After three stops, the day is over. No “one more to get back to green.” “My biggest losses have always followed my largest profits.” **Marty Schwartz** · *Market Wizards*, 1989 💡 The day after your best day gets your normal size, not a bigger one. “…when you’re in a slump, try to be patient and wait for a trade that you feel very confident about and keep the bet size small.” **Victor Sperandeo** · *The New Market Wizards*, 1992 💡 In a slump, take only your cleanest setup, at your smallest size, to rebuild confidence, not the P&L. “Don’t become discouraged, and certainly don’t try to recoup your losses by taking bigger risks.” **John Templeton** · “16 Rules for Investment Success,” 1993 💡 After a loss, the next trade is the same size or smaller. Never bigger. “Volatility is almost always a fee, not a fine.” **Morgan Housel** · *The Psychology of Money*, 2020 💡 A stop-out inside your plan is the fee. The fine is what a broken rule costs. THE MISQUOTES ## They never said it 12 famous lines that travel under the wrong name. Some are still good advice; they just belong to someone else. “The market can remain irrational longer than you can remain solvent.” Credited to: John Maynard Keynes The record: The earliest version is the economist A. Gary Shilling’s, in a 1986 newspaper quote and his own 1993 Forbes column. Keynes got the credit around 1999, more than fifty years after he died. “Compound interest is the eighth wonder of the world.” Credited to: Albert Einstein The record: No evidence he said any version. The earliest “greatest invention” wording found is a 1916 investment-company advertisement. “It’s not whether you’re right or wrong, but how much money you make when you’re right and how much you lose when you’re wrong.” Credited to: George Soros The record: Stanley Druckenmiller said it, describing what Soros taught him, in The New Market Wizards (1992). The idea is Soros’s; the words are Druckenmiller’s. “Losers average losers.” Credited to: Paul Tudor Jones The record: That was the sign on his office wall in the 1987 documentary Trader. What he said in Market Wizards (1989) was “Don’t ever average losers.” “There is a time to go long, a time to go short, and a time to go fishing.” Credited to: Jesse Livermore The record: Not in Reminiscences of a Stock Operator (1923) or in his own How to Trade in Stocks (1940). The closest real line is the novel’s “There is a time for all things, but I didn’t know it.” “Rule No. 1: Never lose money. Rule No. 2: Never forget rule No. 1.” Credited to: Warren Buffett The record: Not in any Berkshire Hathaway shareholder letter from 1977 to 2024. It spread through a book of collected Buffett sayings, The Tao of Warren Buffett, and may be an older gambling saying. “I made my money by selling too soon.” Credited to: Bernard Baruch The record: No book, speech or interview of his has it. The idea was already in print in 1923, in Reminiscences of a Stock Operator, as “Old Baron Rothschild’s” recipe: “I never buy at the bottom and I always sell too soon.” “If you can’t take a small loss, sooner or later you will take the mother of all losses.” Credited to: Ed Seykota The record: Jack Schwager wrote it himself, in the prologue of The New Market Wizards (1992). “Mother of all” was a 1991 phrase, so it can’t be from his 1989 Seykota interview. “When the facts change, I change my mind. What do you do, sir?” Credited to: John Maynard Keynes The record: The earliest match is the economist Paul Samuelson on Meet the Press in 1970: “Well when events change, I change my mind. What do you do?” “In the short run the market is a voting machine, but in the long run it is a weighing machine.” Credited to: Benjamin Graham The record: Graham and Dodd’s Security Analysis (1934) has only the voting machine. The short-run, long-run contrast first shows up from Warren Buffett, in a 1973 newspaper profile, crediting Graham. “The speculator’s deadly enemies are: ignorance, greed, fear and hope.” Credited to: Jesse Livermore The record: Not in his 1940 book. The real line is from the novel: “The speculator’s chief enemies are always boring from within. It is inseparable from human nature to hope and to fear.” “Cut your losses short and let your profits run.” Credited to: David Ricardo The record: No writing of his has it. It traces to a secondhand account of his “three golden rules” printed in the late 1830s, more than a decade after he died. An old market adage, not a quote. ### Watch the rules get used on a live chart The free night class: Clark walks through one SPY session, the levels and when he would and wouldn’t take a trade. Every other Wednesday, 8:00 PM ET, live on Discord. Nothing to buy. [Save a free seat →](https://www.momox.io/class?utm_source=site&utm_medium=quotes) Already a member? [Open the app](https://app.momox.io/). **How we checked them.** Every quote was matched word for word against the original book, shareholder letter, memo, paper or recorded interview it came from, and each one’s grade and source note are kept in our records. Only lines we could trace to the person, or to a reliable dated source, are here. *Reminiscences of a Stock Operator* is a novel, so its lines are credited to its author, Edwin Lefèvre, not to Jesse Livermore, the trader its narrator is based on. *Market Wizards* lines are the traders’ words as Jack Schwager edited the interviews. The quotes are kept short on purpose; the books are worth reading whole. The 💡 lines are ours.