Understand in one picture: What is Position Management, the speculative king Livermore's breakthrough buying method:

(1) First buy 20%;
(2) Assuming the purchase was wrong, stop loss immediately at a 10% drop, with a loss amount of 2% of the total Position;
(3) Assume you bought correctly, increase the position by 20% immediately after a 10% rise;
(4) Increase by 10% and immediately add 20%;
(5) The last time increased by 40%;
(6) Expand the victory results, and then hold as long as it does not drop below 10%;
(7) Sell all positions immediately if it drops by 10%.
The essence lies in finding high-probability opportunities to operate; the market is mostly in a waiting state, and one should minimize trial and error costs as much as possible.
However, this is suitable for building positions in strong coins/stocks during a bull market and is not applicable for a volatile market.
What is Jesse Livermore's core investment philosophy?
Let me summarize briefly:
🔺Trend is Paramount: He emphasizes the importance of aligning with market trends, believing that there are clear bullish upward trends and bearish downward trends in the market. Investors should identify and follow these trends, avoiding going against the trend.
🔺Risk Control: He values stop-loss and capital management, setting stop-loss points for each trade to avoid expanding losses, and reducing risk through diversification and position control.
🔺Independent thinking and patient waiting: He advocates for independent market analysis, not relying on others' opinions, and patiently waiting for the right trading opportunity, such as a price breakthrough at key resistance levels or a pullback to support levels.