• Come into My Trading Room

• A Complete Guide to Trading

• by Alexander Elder

Reviews

• It was with a great deal of curiosity that I began to read Come Into My Trading Room. Elder's first and classic book, Trading for a Living, was the second trading book I ever read and even 40 or so books on from there I still rate it in my top five. I frequently recommend it to others who want a considered and honest introduction to trading. I was interested to see how the themes and emphasis had developed in the nine years since the first book was published. I had read a couple of reviews that said it didn't add much to the previous book but I was eager to make up my own mind. So the first question I asked myself was, "What hasn't changed?" Firstly, the style of writing is as clear and engaging as in the first book. The layout is logical. In all key areas he suggests further specialist reading to take you deeper into the subjects that may interest you. As in the first book, for its size (only 313 pages), it is very comprehensive and covers the three main areas of competence for a trader. Psychology, Technical Analysis and Money Management. Therefore the three pillars from the first book are still very much standing. "What has changed?" A great deal in my opinion. The psychology section is greatly improved. I thought psychology was the main weakness in the first book. Elder relied too heavily on the Alcoholics Anonymous Model. (My previous professional background in treating addictive and compulsive behaviours is the basis for this observation.) He draws the title of the psychology section "The Disciplined Trader" from another excellent book by Mark Douglas. This gives me the impression that Elder himself has been learning a lot over the last nine years. The technical analysis section deals less with basic TA than his first book, instead Elder focuses more on the practical applications of TA to trading. It also includes an update on a method first described in the first book the "triple screen" and a section on systems trading and system testing. As someone who is toying with developing systems at the current time I particularly liked his discussion of the distinction between systems and discretionary traders. The book is not aimed strictly at day traders. In fact he suggests that a trader accomplish at least a years successful experience with end of day trading before moving to intraday trading. He asks his readers to answer tough questions and if you are able to give honest answers you will profit from this book. Elder also concurs with one of my prejudices. He stresses that traders should take their first trades in inexpensive markets, So with futures for example trading the Eurostoxx50 at 10 euros per point is a better starting point for the new trader than Dax at 25 euros. He also provides a helpful method for working out which markets you can afford to trade. It is this applied aspect of the book that makes it so valuable. There is no irrelevant padding here, every paragraph has relevance. The overall balance of the book is about perfect now. In the first book the basic TA took up a large percentage of the volume. This time the sections are much more equitable with quite rightly money management and record keeping getting a more through treatment. One change in this book (and I did wonder if he had read Tony Oz’s wonderful "The Stock Trader") is the inclusion of some actual trade examples. I always like seeing these because following them through gives a real insight into the traders mind in a way simple chart examples can’t. I think there is a more cautious/warning tone about this book than the first. I suspect this might be because Elder runs' trading camps and has had lots of experiences with wannabe traders since writing Trading for a Living. He's very aware of the main reasons why people fail and makes these very explicit in the text. There is a good basic description of the major trading instruments. Elder clearly states the advantages and disadvantages of each. This is a welcome addition as it was missing from the first book. The section for new traders (or "babes in the wood" as he calls them) covers the basics of setting up to trade from home. He discusses which instruments and markets to look at and the issues of commission, slippage and expenses. Elder stresses the importance of the bottom line and the need to keep trading expenses such as commission under control. Conclusion This is a book written by a mature trader and educator, who has seen and done it all and can now give the most balanced, practical and honest description of learning to trade you will find anywhere. I highly recommend it to new traders and improvers alike.
  W Vinall