Best Trading Insights from Bruce Kovner
Investopaper
Bruce Kovner, currently worth $7.7 billion (As of 2023), is a well known trader and an accomplished hedge fund manager. He is currently the chairman of CAM Capital established in 2012. Until 2011, Kovner was the founder and manager of Caxton Associates, which at its peak had $14 billion assets under management.
A highly successful trader himself, Kovner has more to offer to the aspiring traders. Here are his some of the best trading insights (quotes) from Bruce Kovner:
Best Trading Insights (Quotes) From Bruce Kovner
The first rule of trading is don’t get caught in a situation in which you can lose a great deal of money for reasons you don’t understand.
Successful traders are strong, independent, and contrary in the extreme. They are able to take positions others are unwilling to take. They are disciplined enough to take the right size positions. A greedy trader always blows out.
You have to be willing to make mistakes regularly. There is nothing wrong with it.
Risk management is the most important thing to be well understood. Undertrade, undertrade, undertrade is my second piece of advice. Whatever you think your position ought to be, cut it at least in half.
Whenever I enter a position, I have a predetermined stop. That is the only way I can sleep. I know where I’m getting out before I get in. The position size on a trade is determined by the stop, and the stop is determined on a technical basis. I never think about other people who may be using the same stop, because the market shouldn’t go there if I am right.
If you personalize losses, you can’t trade.
Through bitter experience, I have learned that a mistake in position correlation is the root of some of the most serious problems in trading. If you have eight highly correlated positions, then you are really trading one position that is eight times as large.
Fundamentalists who say they are not going to pay any attention to the charts are like a doctor who says he’s not going to take a patient’s temperature.
As a trader who has seen a great deal and been in a lot of markets, there is nothing disconcerting to me about a price move out of a trading range that nobody understands.
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