A Sucker's Diary

Rating:
Summary: unique and personal!
Review: I admit that I am not an avid book reader unless it involves techno-books. I came across this title in a web search for a book on "stock-market experiences, successes and failures" -- preferably one written by a non-financial professional -- to help me in my personal investment ventures. After reading the web abstract, I bought the book and begun reading it casually. I read the first few pages after which the book grabbed my full attention. I found it very interesting and kept mental notes of "Yeah, I am glad I did not do this or that" and "Oh no! I wish I had also done this and that". In summary, my kind of book, most-likely your kind of book too.

Rating:
Summary: TOO TECHNICAL, SMALL TIME PLAYER
Review: I myself am a daytrader and thought this book would be interesting. First of all the guy uses all false names from his own, to even the firms he did his trades with. Second, the options trades are way too technical and every single one is mentioned Just give us the net gain/loss per trade. Third, the guy does maybe 100 to 200 trades in a couple years. I don't consider myself a huge trader but i did over 2000 trades in last year alone. He also blames the discount brokerage firm for letting him trade options so recklessly when he himself had been warned by so many people and articles and even went as far as to change his option paperwork so he could continue trading after the firm had restricted his account. The amounts he writes about are so small (big loss of maybe 18k) it's just not that engrossing...Again i don't consider myself a big player. My account was maybe 300k last year and i had losses and gains of over 130k on some days....if you want my story send me an email..its a lot more exciting!

Rating:
Summary: TOO TECHNICAL, SMALL TIME PLAYER
Review: I myself am a daytrader and thought this book would be interesting. First of all the guy uses all false names from his own, to even the firms he did his trades with. Second, the options trades are way too technical and every single one is mentioned Just give us the net gain/loss per trade. Third, the guy does maybe 100 to 200 trades in a couple years. I don't consider myself a huge trader but i did over 2000 trades in last year alone. He also blames the discount brokerage firm for letting him trade options so recklessly when he himself had been warned by so many people and articles and even went as far as to change his option paperwork so he could continue trading after the firm had restricted his account. The amounts he writes about are so small (big loss of maybe 18k) it's just not that engrossing...Again i don't consider myself a big player. My account was maybe 300k last year and i had losses and gains of over 130k on some days....if you want my story send me an email..its a lot more exciting!

Rating:
Summary: Read This Book Before You Make Your Next Trade
Review: I read this book on my ebook, where I stumbled on it while browsing the new catalogue. It was an excellent read and I finished it in a day. The most fascinating part of the book is the story of how the author slowly got suckered in to each level of trading, and set himself up so he could do nothing but fail. The other part of the book I most enjoyed was how vividly he described the methods that brokerages use to rip off the average investor, and how bad the odds are stacked against the active trader. Finally, the author quotes the brilliant speculator Bernard Baruch who wrote that "speculating is a full time profession." Nothing could be more true. I would definitely recommend this book to any investors or traders who want to get a clearer picture of why this game is so difficult to beat.

Rating:
Summary: Read This Book Before You Make Your Next Trade
Review: I read this book on my ebook, where I stumbled on it while browsing the new catalogue. It was an excellent read and I finished it in a day. The most fascinating part of the book is the story of how the author slowly got suckered in to each level of trading, and set himself up so he could do nothing but fail. The other part of the book I most enjoyed was how vividly he described the methods that brokerages use to rip off the average investor, and how bad the odds are stacked against the active trader. Finally, the author quotes the brilliant speculator Bernard Baruch who wrote that "speculating is a full time profession." Nothing could be more true. I would definitely recommend this book to any investors or traders who want to get a clearer picture of why this game is so difficult to beat.

Rating:
Summary: A personal account of the dangers of daytrading
Review: This is a sobering and very personal account of the dangers of daytrading from the perspective of an obviously smart and resourceful person. Katzman describes in detail how he slowly became addicted to the stock market, the huge amounts of energy that he invested and the financial disaster that followed. However, Katzman does not give up and proves that it is possible even in the face of a tremendous failure, to retain his dignity, learn from his mistakes and find his true calling. This book was entertaining, educational and inspiring all at once, and will strike a chord in anyone who has felt the allure of the stock market.

Rating:
Summary: A Little Financial Knowledge is a Dangerous Thing...
Review: Told with matter-of-fact honesty and methodical detail, A Sucker's Diary details one man's four-year nightmare in the stock market. Inspired by Peter Lynch's One Up on Wall Street, among other things, the author aspired to be a player in high finance.

By true day trading standards, this person was numerically a small player, controlling perhaps $300,000 in financial assets at his peak in mid-1996 and trading perhaps a few times a week. Many of his later trades in options were hard to follow (for me) so it's hard to tell the exact situation. However, despite the fact that he may be "small time", his story is told with heart and he really helps you get into his shoes (with holes in them, at that).

It's worth wondering if the author "Mr. Katzman" had used an even deeper discount broker ($8 per trade instead of $30), or had been in a more bubble-friendly environment such as 1997-2000 instead of 1994-1997, if he might still be with us, and a millionaire. Particularly in the later stages of his mania he seems to have been bent on destruction, and perhaps his wipeout would have been even more spectacular. One has to admire his dedication to pay off his massive debts following his financial collapse. However, he shows you his ugly traits in this novella as well as his positive qualities, giving the whole tale a good ring of truth.

This book is most helpful to someone new to the financial markets, who might have just read "One Up on Wall Street", thinking, "Hey, I can trade stocks like Peter Lynch too!" I doubt if true day traders, manic-depressive and otherwise, will get much out of this book except the pungent atmosphere.

What did Mr. Katzman do wrong? Without going through the whole book I think there were three key mistakes that he made regularly:

Leverage - Mr. Katzman financed his stock purchases with $50,000+ in credit card debt, and margin debt on top of that. Were he not maximally leveraged with the credit card debt, he might have been able to hold on better when the market went against him. In addition, the added anxiety arising from his leveraged position tended to cloud his thinking.

Lack of Diversification - He normally concentrated his portfolio in fewer than five stocks (it seemed like three) - although with options this is more difficult to measure.

Half-Baked Thinking - Some of the ideas he had for his portfolio would be along the lines of the following: A Business Week article says that global warming is going to increase risk of skin cancer in Americans, so he goes out and buys a company that has a skin cancer treatment. Well, if Business Week has thought of it the market probably discounted it last year, let alone last week. You need to take things to the next level when you think of investing ideas (I am prone to this weakness as well).

If you think you can't make the mistakes Mr. Katzman did, please try to read this book with a little humility. Would that every investor in the market could learn this man's lessons.