📖Jesse Livermore
Process-Oriented Investing
Good process outperforms lucky outcomes over time.
Focus on process, not outcomes. A good process can produce bad outcomes in the short run, but will generate superior results over time.
🏠 Everyday Analogy
📖 Core Interpretation
Jesse Livermore sees markets as cyclical rather than linear. Understanding cycle position improves risk-taking decisions more than trying to call exact tops and bottoms.
💎 Key Insight：Process discipline is more reliable than chasing results.
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❓ Why It Matters
Ignoring cycles repeats the same mistakes: excessive optimism at peaks and excessive pessimism near troughs. Context matters for position sizing.
🎯 How to Practice
Monitor credit, valuation, earnings, and sentiment signals; reduce aggressiveness in euphoric phases and preserve flexibility in fearful phases.
⚠️ Common Pitfalls
Treating short rebounds as full cycle turns
Extrapolating peak conditions indefinitely
Becoming maximally defensive near valuation troughs
📚 Case Studies
1
Bethlehem Steel Bull Run (1915)
Livermore built an initial stake, then pyramided only as the stock advanced and confirmed strength, adding smaller tranches at higher levels to control risk.
✨ Outcome：Captured a large portion of a powerful wartime advance while limiting exposure if the uptrend failed.
2
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.
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