Larry Connors is a well-known trader and author. He has written several booked on quantitative trading and short-term trading, including Buy the Fear, Sell the Greed and Street Smarts – High Probability Short Term Trading Strategies (co-written with Linda Raschke).
As a trader, he uses a combination of fundamental and technical analysis, including moving averages and momentum indicators. In his books, he emphasises the importance of risk management and money management for successful trading.
Here are some of his best quotes:
Ever the pragmatist, Larry Connors is clear on what is required to succeed in trading:
“Successful trading requires both discipline and patience.”
This is a nice reminder that losses will occur, with even the best trading strategies.
“No matter how much analysis you do, trading is still a game of probabilities, so expect to be wrong sometimes.”
Here he emphasises the power of a good risk/reward ratio, where profits can be much greater than losses:
“The stock market is a place where one can risk a little to gain a lot.”
And as a follow-on from seeking good profits, this is a reminder to let the good trades run, follow the trend, and not get scared out of them too early”
“Don’t be fooled by short-term market movements. It’s important to focus on the long-term trends and make decisions based on them.”
Again, here is the importance of having a healthy risk/reward ratio to be profitable in the long term.
“The best traders are those who understand the concept of risk/reward and are able to take calculated risks to maximise their returns.
It might be obvious to anyone who has traded for any length of time, but there’s no harm in this reminder of what is important:
“The most important decision you make in trading is when to enter and when to exit a trade.”
Many successful traders highlight the importance of finding what works for your individual trading personality, and Larry Connors is no exception.
“Your trading plan should be a roadmap to success and should be tailored to your individual goals and risk tolerance.”
And taking responsibility for your own trading decisions:
“The only way to make money in the markets is to think for yourself and not follow the crowd.”
Here he touches on the importance of emotions in trading psychology:
“The most important thing in trading is to control your emotions, and not let fear or greed control your decisions.”
A fan of diversification, Larry Connors stresses the importance of reducing risk in this way.
“It is important to diversify your trading strategies to reduce the risks associated with any one strategy.”
As already mentioned, Larry Connors is a big fan of risk management in his trading:
“Risk management is essential to successful trading and should be at the core of any trading plan.”
The importance of adapting to market conditions is another theme that comes up in Larry Connor’s books:
“The markets are constantly changing and you must adapt to the changing conditions to be successful.
And finally, in the same theme is his thought that as traders, we should keep learning and adapting.
“Trading is a journey, not a destination. You should always be learning and adapting your strategies to stay ahead of the competition.”
