One Good Trade: Inside the Highly Competitive World of Proprietary Trading 1st Edition

I don't often write reviews, but I really liked this book. I read this book in two days. I first heard about Mike Bellafiore through Dr Brett Steenbarger's blog, "Traderfeed".The title, "One Good Trade" refers to a process as taught by SMB Capital, a proprietary trading firm which Mr Bellafiore owns with a partner. The process entails following the seven fundamentals taught by SMB through the entry and exit of a trade and then going on to the next trade and following those fundamentals again and repeating this process for the rest of your trading life. The seven fundamentals are detailed in the book. Mr Bellafiore's emphasis is on this process. He states that making and losing money on any specific trade is not the focus, but following this process IS the focus and making one good trade after another by following these fundamentals is the essence of good trading. You can lose money on a trade, but if you follow these fundamentals and this process, your profit and loss statement will ultimately take care of itself. He compares this to sports teams and the way they practice the fundamentals over and over and then execute those fundamentals in the game. There are plenty of sports analogies here with the implication that an elite trader must go through the same kind of rigorous and disciplined training that successful athletes go through. Having played sports in high school and college and now trading full-time, I have to agree. The book begins with the explanation of this process and the principles of this process are felt throughout the book. Mr Bellafiore is not here to teach some new technical analysis technique, thank God. He basically states that his firm already knows those techniques. That's the easy part, the difficult part is training traders to FOLLOW and trade the patterns that he already knows are successful. This reminds me of the statement made by Paul Tudor Jones that you can give most people tomorrow's Wall Street Journal and they will STILL lose money. It's the difference between hitting perfect shots on the driving range and then executing those same shots in a competitive round of golf. The emphasis here is on the psychological side of trading which, for me, is really all there is. It doesn't really matter how well you can call markets if you are exiting trades with a .20 cent profit, because you are so exited about being right and making a little bit of money, when the target on the trade was a dollar, The emphasis is NOT on being right in your market forecasting skills, but on building the skills to execute each trade correctly. So Mr Bellafiore is stating that being right in and of itself is NOT enough, the trading process is MUCH more than calling markets correctly. Being right has much more to do with ego and pride than making money. So paying attention to the fundamentals and their execution rather than bragging rights about market direction is, for Mr Bellafiore, the STARTING point. And executing these fundamentals is MUCH more difficult than one anticipates and requires YEARS of dedication, sweat and hard work. No wonder there are so few elite traders or, for that matter, elite anything. It's not that correctly calling markets is not important, it is, it's just that forecasting becomes secondary to skill building and discipline.The book is sprinkled throughout with stories of traders, both successful and unsuccessful. I found these stories very interesting and I recognize one of the successful traders from Mr Bellafiore's blog. (A blog that, in my opinion, is worth your time). In one chapter, Mike Bellafiore describes the hiring process at SMB and how difficult it is to choose a person that will succeed as a trader. A Prop firm funds traders that they train and the firm makes money based upon the success or failure of these traders.Later on the author details some of the strategies commonly used by SMB traders. On the surface, these are similar to patterns which I think most traders are familiar with. The difference is in the application of these strategies and for that I think one may need to go through the SMB Training. I started trading before Prop firms became as popular as they are today. If I was just starting out today, I believe this is the route I would take if I was fortunate enough to be chosen. The hiring process is VERY selective. Mike Bellafiore is big on traders getting out there and sharing and exchanging ideas. As most independent traders know, this is a lonely profession. It doesn't have to be, but most traders are in a room full of screens with only their own minds and a few internet feeds. For me, I am happy Mike Bellafiore took the time to exchange his ideas with us. I am currently reading the book for the second time. This is definitely a book worth adding to your trading library.

First of all this is Bryan and not Brooke! I had to ask my wife to borrow her Amazon account so that I could write a review. Apparently creating an Amazon account is not enough to write a review, they found a way to monetize even that part of their business (hence the nearly $800 stock price). Sarcasm aside, I read the reviews of One Good Trade prior to reading the book and then again upon completion. I have never been someone to take the time to write a review for a book I read, but given my affinity for the book I felt compelled to offer my perspective.To give full disclosure, I worked on Wall Street on a prop desk during one of the greatest times in history ( Late 1990s- Early 2000s) and I enjoyed great success where I was able to quickly become a CPT ( Consistently Profitable Trader). Similar to the experience the author describes in the book, I never received the in-depth training that could have given me a better chance of success. I succeeded through hard work, asking a lot of questions, improving daily, and being surrounded by other talented individuals. I am sure there was some luck involved, but my point is that this book provides valuable insight into not only the job of a professional trader but the experiences, thought process and most importantly challenges that will surface if one chooses to embark on the challenging career of a prop trader.I found the anecdotes to be poignant and at times amusing. I found One Good Trade to be enjoyable and more importantly educational. I was shocked how much I learned about trading that I either forgot or never knew. The author does a nice job of explaining things in layman's terms while still challenging experienced traders. I read the book in a few days and enjoyed it so much that I had my wife purchase The Playbook which I read the following week. Since I won't be writing a second review, I will tell you that as helpful as One Good Trade was, The Playbook was even better. The Playbook provided an updated and even more relevant insight into the discipline, patience and work ethic required to succeed in the highly competitive world of proprietary trading.Lastly, I will say that the author comes across as more of a coach than a critic. It seems that he really does want to help people and see them succeed. It is a shame that some people couldn't find something positive to enhance their trading or understanding of a prop desk from the book. I highly recommend it for anyone with a positive attitude that is looking to improve himself/herself. If you are a novice you will learn a ton. If you are an experienced and successful trader then hopefully you will take away one concept that will make you even better. Enjoy.