📖Jesse Livermore
Know Your Limits
Stay within your circle of competence.
The most successful investors stay within their circle of competence. Know what you understand well and resist the temptation to venture outside it.
🏠 Everyday Analogy
📖 Core Interpretation
Jesse Livermore advocates a repeatable process: define criteria, execute consistently, and review decisions against evidence. Process quality drives outcome consistency.
💎 Key Insight：Self-awareness about knowledge limits prevents costly mistakes.
AI Deep Analysis
Get personalized insights and practical guidance through AI conversation
❓ Why It Matters
Without process, there is no reliable feedback loop. Structured execution and review improve decision quality over time.
🎯 How to Practice
Run a decision loop of research, thesis, execution, and post-mortem; document assumptions and update playbooks with evidence, not hindsight bias.
⚠️ Common Pitfalls
Having opinions without execution criteria
Reviewing outcomes but not decisions
Abandoning rules during volatility spikes
📚 Case Studies
1
Shorting the 1929 Crash (1929)
Identified market weakness, started a core short position, then pyramided correctly as the decline gained momentum, adding to winners only when prices moved further in his favor.
✨ Outcome：Amassed one of his greatest fortunes as the market collapsed, while avoiding reckless over-sizing early.
2
Livermore Short Before Crash (1929)
Livermore shorted leading stocks as the 1929 bubble peaked. When some positions initially moved against him, he refused to add to losers, keeping risk capped.
✨ Outcome：Market crashed, his existing shorts paid off massively, validating not averaging down into a rising market.
See how masters handle real scenarios?
30 real investment dilemmas answered by legendary investors
Explore Scenarios →