Day trade VS Value investing <---> Jesse Livermore VS Benjamin Graham

Submitted by stock_122 t3_z5x4q7 in wallstreetbets

Day trade VS Value investing

Jesse Livermore VS Benjamin Graham

Jesse Livermore

  • Pioneer of day trading
  • Born in 1877
  • At one time Jesse was one of the richest men in the world, he was worth $100 million ($1.5 billion in today’s money) at his peak
  • Jesse died in 1940 by suicide, at the time of his death Jesse had more liabilities that assets
  • His strategies were based on observing price patterns, stock trends, pivotal points, and Volume in the stocks.
  • Livermore acquired his money by trading his own.

Benjamin Graham

  • Known as the father of value investing
  • Born in 1894
  • Started his career on Wall Street and founded his company Graham–Newman Partnership, and employed his former student, Warren Buffet
  • Graham earned about $500,000 per year by the age of 25
  • Graham’s philosophy is using the strategy of Value Investing using fundamental analysis, trying to acquire stocks that are undervalued (buying cheap and selling high)
  • He has 3 rules, first rule, is never to trust the market, it can be irrational in the short and medium term, the second rule is to stick to a strict formula that you do all your investments, and the third rule is to analyze for the long term and protect yourself from losses.

I used to Day Trade and Swing Trading but I believe Value Investing is the only sustainable way to be successful in the market.

Just look at these two men…

What do you do?

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Comments

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_Kenway t1_ixyetch wrote

>Brandi Love is the great granddaughter of Jesse Livermore

29

That-Whereas3367 t1_ixyh7lk wrote

Livermore's greatest contribution to society IMO.

Jesse was a notorious shagger. So was his son. I guess it runs in the family.

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enterthegasman t1_iy07k1g wrote

I have learned many things from WSB.... but this right here might be the greatest.

9

VisualMod t1_ixycz6b wrote

>There is no question that value investing is the superior strategy. Over the long term, it simply outperforms day trading or swing trading. However, there are certain situations where day trading or swing trading may be more profitable in the short term. It really depends on market conditions and your own personal preferences.

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stock_122 OP t1_iyc6dvx wrote

I agree to some extent, I believe that maybe when entering a stock you already analyzed using tools you learned from day trade could be useful and help you raise your profits, but without any prior knowledge of the company this tool could be very dangerous.

By the way, I formed a small community of value investors and I think you would fit.

If you are interested, I would love to send you an invite

1

That-Whereas3367 t1_ixyh4o4 wrote

Livermore - inside trader and total regard. (Also great-grandfather of pornstar Brandi love).

Graham - bought cheap stocks during Great Depression.

Neither have any real relevance to modern investing which is controlled by giant index, pension and hedge funds.

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darkspd96 t1_ixzjhpb wrote

#THIS!!

Checkout an original version of security analysis, you can see Graham's review of companies, some of them are selling for half their earnings with a PE of 0.5…. give me a break

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Theta_Ome t1_ixyvr6y wrote

Active trading is a skill that can be profitable if achieved but disastrous if you fail. Value investing is benefiting from a long biased market, delayed taxes on compounding gains, and a banking system that rewards hodlers and the smart use of debt against it instead of creating a taxable event by selling. But it teaches you to so nothing, essentially, putting you and your emotions at the mercy of the market swings making you an inactive participant.

They’re both wrong because it’s only a small piece of financial strategy presented as the whole picture.

In reality, each one is a wolf speaking the gospel of braising to brand new baby lambs.

Wee lamb.

But seriously, do both Active and inactive trading/investing until one just doesn’t work for you. Choose the thing you’re good at that makes money and repeat.

I like Graham well enough.

But Rockefeller is my lord and savior

and Kirby Rosplock is my teacher of the gospel of finance.

3

Inevitable_Play_5043 t1_iy3c86c wrote

Rockefeller and the other lords paid themselves 100% dividends, anyone could get rich if they were in the club. He also stumbled into the gas business after cars were invented because it was a byproduct of his kerosene business. He was lucky and then ruthless.

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Theta_Ome t1_iy3dnjs wrote

Absolutely. It’s probably the illuminati.

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No_free_lunch_ t1_ixzqfxd wrote

Hold the winners of your portfolio and cash out during irrational times. Swing trade for quick pleasure (or pain)

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BastardSamuri t1_iy0o3f7 wrote

I like Graham’s philosophy. Just waiting for that monster drop that everyone here keeps talking about / hoping for so I can scoop up a bunch on the cheap. So far, still waiting.

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VisualMod t1_ixycyud wrote

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^^WSB ^^Stats ^^Discord ^^BanBets ^^VoteBot ^^FAQ ^^Leaderboard ^^- ^Keep_VM_Alive >TL;DR: Jesse Livermore was a day trader who made and lost a fortune several times over. He eventually died by suicide. Benjamin Graham was an early investor and advocate of value investing. He is considered the father of value investing.

1

hangGlider2019 t1_iy0izpz wrote

I don't know how long Livermore held his average stock trade but I'm pretty sure he wasn't a day trader.

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eddie7000 t1_iy0pn22 wrote

He was a swing trader who used day trading principles for entry and exit. He was able to tune into the market patterns but couldn't maintain it over the long term as the psychological pressure built up the longer he was active in the markets. So he went broke, took some time off then came back and made a fortune two more times before completely wrecking his emotional health. Was playing a young mans game, and when he realized he was too old to play it was lights out.

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jcvmarques t1_ixyg99j wrote

Don't day trade. You can't handle the emotion.

1

eddie7000 t1_iy0r099 wrote

The losing patterns carve their way into your brain like a car crash victim and then the new losing patterns all look like winners.

Pattern blindness is real folks. Be careful out there.

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Plus_Seesaw2023 t1_iy01how wrote

I think this example could be very interesting. IF you bought SPY on September 13-15 (around $395), and kept your position open, you are now green. Who is green, here, during the last 51 trading periods????

Those who have lost money, buy the SPY or very strong stocks (only shares), and go for a walk (DCA if necessary).

1

stock_122 OP t1_iyc789x wrote

I agree, show me one day trader that has made money consequently over the last 30 years from the stock market (not from books or courses).

Just look at Warren Buffett.

I formed a small community of value investors and I think you would fit.

If you are interested, I would love to send you an invite

1

mammaryglands t1_iy1wad4 wrote

Back in my formative years there was this thing called the banhammer, and right about now it would be bonking you on your stupid head. Also, fuck you.

1

RealMcGonzo t1_iy43vq6 wrote

Livermore and his son, Jesse Livermore JR and his son Jesse Livermore III all killed themselves. So the take-away is, don't fucking name anybody Jesse Livermore.

1

Outrageous-Papaya-13 t1_iy1ds8x wrote

I buy an option and put my tail between my legs and hope for the best. Is the stars align I get paid. If I lose I rinse and repeat.

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ChadSuperCock t1_iy20xb6 wrote

I day trade large volumes to make money to invest in value trading long term. One supplies the other. Typical trade is $200k to $$1M on large volumes for $5k gains. Sometimes I have to wait for the gain, but the margin of safety is primarily there, and I statistically come out ahead.

0