Jesse Livermore, who is thought to be the grandfather of stock trading, was born in 1877 and died in 1940. Although Jesse traded more than 100 years ago, the principles he used for trading at the time are still practiced firmly by many of the legend’s followers today. He was an ordinary American citizen who rose to riches through trading and also saw his share of multi-million dollar losses.

‘Boy Plunger’ was the nickname given to him early in his life when he started his journey towards a successful future as a trader through various bucket shops, which is another name for gambling houses. He used to trade there and started at the tender age of fifteen. When Livermore turned 40, he already had a $100 million fortune which in today’s terms can amount up to $6 billion dollars, a staggering amount. And he rose to fame when he shorted the market in 1929 when the entire US stock exchange was crippled.

The Trading Style of Jesse Livermore

Jesse was an active and successful trader in the US even before the great spike and plunge of the US economy. The Civil War, having been long over, people still remembered it. However, it was also era of great industrial development in the US at the time which presented a great deal of opportunities for smart traders and businessmen. It was at this time that America rose to becoming a safe haven for all who needed shelter and food.

This induced a massive influx of settlers who chose to escape the endless hardships of the Old World to embark on new beginnings through hard and honest labour. And this is what Jesse Livermore loved and the sort of environment he chose to invest in. He got involved with people like Henry Osborne Havemeyer, the owner of American Sugar Refining Co, along with the owner of the National City Bank, which has become Citigroup today, E.H. Harriman, the master of the railroads, J.P. Morgan legendary banker and the founder of Standard Oil, William Rockefellar.

He was rolling with all the big people responsible for developing these booming industries. Livermore was familiar with each and every industry, from coal to coffee, to sugar and the world of banking, which meant he had a tremendous amount of knowledge and information available to him at any given time.

Yet with all that knowledge, Livermore was convinced not to anticipate anything in the market and chose to be patient and let things swing in the way his knowledge enabled to predict and believe that it should and it did, so he did what he did best: invested in a bullish market and shorted in a bear market.

However, Livermore’s personal life was not as successful as one might imagine. Having endured three unsuccessful marriages he was also stricken with clinical depression which had been with him for a long time. And this is what led him to taking his own life in 1940.

The Grandmaster’s Principles in Momentum Trading

Although Jesse Livermore was active along time ago, trading in commodities and stocks, making millions. Believe it or not, the methods and principles he used are not so different from today’s financial world and just as legitimate. Jesse Livermore used to say a successful trader never acts on his own instincts until the market has deemed his instincts correct. If you try to understand the meaning behind what Livermore was talking about, it would do you good to remember you are in the market to make investments and not to form prophesies.

And many of the successful traders today follow in Jesse’s footsteps, which is not to anticipate but to follow the markets to a more fruitful return. The maestro also used to stress on the fact a trader can never buck the stock market, because there is never anything new. However, there are always variations of the same patterns, insightful for a man who traded 10 decades ago.

Livermore also emphasized on the fact one should never trade when he is unsure of the opportunities in the market, learn to hold money. This means all good trades need time and a lot of patience and greed is the worst enemy of a trader. All in all, Jesse Livermore’s wisdom still carries out, even today where everything is modernized in the world of stock, hedge funds and ETFs.

Market Place

MKTPlace is a leading digital and social media platform for traders and investors. MKTPlace offers premiere resources for trading and investing education, digital resources for personal finance, news about IoT, AI, Blockchain, Business, market analysis and education resources and guides.

There are a number of fundamental differences between a trader and an investor. The only similarity they may share is that both investors and traders can lose money just as easily as they make it. We can learn from the successful traders.

To start trading though, you don’t need an investment or apply for a loan. You’d be surprised to know some of the world’s most brilliant and legendary traders themselves went through a lot of trial and tribulations before they became what they are today and before their names were immortalized in the history of trading.

Mentioned below are the names of the top successful traders who managed to beat others in the market through their skill, their diligence, tenacity and instincts. So, get ready to get some inspiration.

Top Ten Successful Traders of the World

1.  Jesse Livermore – The Master of Speculation

The skill of speculation that Jesse possessed thrived when he accurately predicted the 1929 stock market collapse. Livermore began trading as a 15-year old, trading at various gambling houses and through his studies and research he rose to fame and power when forecasted the 1907 and the 1929 markets collapses and made $100 million (which in today’s terms amounts up to $6 billion), in the blink of an eye. Having been associated with various industrialists at the time, Jesse proved to be instrumental in contributing towards America’s industrial revolution.

2. Paul Tudor Jones – Understanding the Core Dynamics of Trading

Paul Tudor Jones, another trading genius, called on the 1987 stock market crash because of that the day became labelled as Black Monday. Tudor accurately predicted the fall of the market by recognizing and understanding a series of events that led him to success. He understood at the time if the market started to descend rather than dry up, selling in the market would actually cascade. Jones understood an overvalued market would definitely give birth to more selling. Gambling on this, Paul went on making $100 million faster than you could say ‘I want to be rich!’

3.  George Soros – Defeating the Bank of England

As if this man needs any introduction at all, George Soros is the trader who broke the Bank of England without breaking a sweat. He predicted that the pound was going to fall and shorted it, making an easy $1 billion. Although many other traders deemed this gamble as nothing short of reckless, Soros was pleased about it. Well, of course, he would be. It was a ridiculously rewarding gamble! George forced the Bank of England to withdraw from the ERM (European Exchange Rate Mechanism).

4.  John Templeton – Betting on Japanese Assets and Winning

Templeton was the master of mutual funds. He invested $100,000 in Japanese assets when Japan was undergoing an economic change for the better, Templeton ended up making $55 million on a $100,000 investment. And in 1999, when Japan was starting to achieve it economic goals, Templeton decided to invest 60% of his funds into Japanese assets, which was again a spectacular success.

5.  Andrew Hall – Predicting the Oil Prices

In 2003, a barrel of oil was traded at $30. At the time, Andrew Hall predicted the price per barrel of oil is going to reach $100 within the next 5 years. Turned out his gamble was spot-on. He worked for Citigroup, making a ton of money for his employer. The trader made about $100 million.

6.  Paul Rotter – The Master Flipper

An expert in gauging the market’s psychology, his techniques were impeccable and significantly aided him in becoming a master of the markets. Paul being the initiator, his ideas and strategies proved to be instrumental in conducting trades on the Eurex exchange (Bund, Bobl and Schatz) markets.

7.  John Paulson – Shorting Real Estate

John Paulson is known for successfully executing what is known as the ‘greatest trade ever’. Paulson accurately predicted the asset bubble in the real estate market which had the potential for bringing in billions of dollars into Wall Street. Paulson ended up making $15 billion for his employers in 2007 for which he got a dizzying $3.7 billion.

8.  Jim Chanos – The Perceptive Short Seller

Jim Chanos rose to fame in October 2001 shortly after the downfall of Enron. Chanos was a master when it coming to shorting trades and made heavy profits by selling commodity currency and security. His most popular shorts include Baldwin-United and as of late, homebuilders like KB Home.

9.  Louis Bacon – The Gamble on Geopolitical Factors

Bacon is one of successful traders and ended up rightly predicting that Saddam Hussein would invade Kuwait. Just a year after that, he also predicted and gambled on the fact that the US would defeat Iraq when the oil markets were beginning to recover. He was a master at trading using geopolitical motivators and aspects and has made a lot of money doing so.

10. David Tepper – Investing Money in Diminishing Assets

The last on the list, another successful traders is Tepper has a record for investing in distressed assets and has made a lot of money doing so. He predicted the Bank of America along with Citigroup will not be nationalized and he made a fortune. David bought extremely depreciated shares and saw them grow tremendously in value towards the end of 2009.

So, these are the best traders you can learn from and be inspired by.

Market Place

MKTPlace is a leading digital and social media platform for traders and investors. MKTPlace offers premiere resources for trading and investing education, digital resources for personal finance, news about IoT, AI, Blockchain, Business, market analysis and education resources and guides.

Every day, there are thousands upon thousands of trades and transactions which are conducted between investors all across the globe. However, if you come to think of it, many of those investors will not be remembered for anything.  And in this regard, the legendary trades which have become a memorable part of financial history have to be absolutely amazing indeed.

If you are thinking the guys who made it into the history books simply landed there through making tons of money in the market, then you are wrong. Some of the greatest trades ever made have been made by people who used their intellect, their gut feeling, and cunning and intuition to determine the right moment to strike and to make it big, even when everybody else thought they were simply nuts for making such trades.

Just pause and think for a second. The famous John Paulson shorted the housing market of the US when every trader on Wall Street deemed the market bullish. Jim Chanos kept his Enron shares short even though he knew the stocks were going to shoot up. Now, moves like those require critical analysis, thorough knowledge, and above all, they require grit.

Listed below are some of the greatest traders who have made history, by making some of the greatest trades in the world through their diligence, and their feats still stand unmatched:

Jesse Livermore – The Man Who Shorted the Market Collapse in 1929 and made $100 million 

jesse livermore quote

Jesse Livermore is regarded as the most famous short seller in US stock market history. He began shorting stock purely on gut instinct just before the San Francisco earthquake hit. Although there was no way he could have predicted the earthquake, the trade did make him $250,000, which led to him consistently short selling stocks in the market. Shortly after, in 1907, he went on to make millions when he shorted the market collapse.

However, it wasn’t until 1929 that he made it into the big leagues. It was when he shorted the whole stock market and made a cool $100 million in the process. Imagine that! He is deemed as the pioneer of short sell trading and was the inspiration for the book, Reminiscences of a Stock Operator, which is a fictional account of a trader.

Paul Tudor James – The Man who Made $100 million by accurately Predicting Black Monday in 1987 and Shorting the Entire Stock Market

paul tudor jones quote

Utilizing the analysis from technical reports, various evaluations, and the historical information of S&P, Paul Tudor Jones accurately predicted that the market will collapse in 1987, and followed through by short selling his stock in huge quantities. And as he predicted, the Dow dropped by 22%, which made him an estimated $100 million.

Subsequently, PBS made a documentary about Paul Tudor Jones, which was named Trader, and just after its release, Jones went out and bought all the copies so that no one else could see the documentary. He was concerned it could reveal his trading secrets.

Andy Krieger – The Man who shorted the Kiwi in the 1980’s and Ended Up Making $300 million

Back in 1987, when the market crashed on Black Monday, a majority of the investors discarded the US dollar and began to look for other currencies. 32 at the time, Krieger was a currency trader working for Banker’s Trust. He analyzed that the New Zealand dollar, which is also known as the Kiwi, was ridiculously overvalued. Using financial trading instruments which were new at the time, he shorted his position against the Kiwi, which was worth millions of dollars. His short sell order exceeded the entire New Zealand supply at the time.

And just like he had anticipated, the Kiwi fluctuated between a 3 to 5% loss, which made his company $300 million. Krieger himself ended up making $3 million from the trade.

George Soros – The Man who Made $1 billion by Shorting the British Pound

george soros quote

Back in the 1990’s, when the British economy was doing very well, the legendary George Soros proceeded to short the pound, and he borrowed massive amounts to accomplish this harrowing feat. Soros shorted the pound when the currency was traded on a fixed rate of exchange.

After Soros made the bet, the government of Britain realized it could end up losing billions if they consistently and artificially piled up the pound. Soon after, they moved away from the European Rate Mechanism, which resulted in a massive plummet of the pound’s value. This made Soros $1 billion, giving him the status: brilliant billionaire investor.

So, what do you think now? Some of the major traders and investors of today have been inspired by these great men who took trading to an entirely new level.

Market Place

MKTPlace is a leading digital and social media platform for traders and investors. MKTPlace offers premiere resources for trading and investing education, digital resources for personal finance, news about IoT, AI, Blockchain, Business, market analysis and education resources and guides.