How I Made $2,000,000 in the Stock Market

I'm new to investing and trading, I will admit it, I've been doing it for a few months now, and I started with only a thousand dollars, even though Darvas once said that if you don't have five thousand you shouldn't even step in--though I'd say that was probably because the cost of the commission made it so much more difficult. I've read this book four times, once out loud to my mother who has also opened an account, and used this strategy with William O'Neil's CANSLIM to start growing her retirement, already up five thousand from the twenty thousand account she opened. This book helped me spot stocks like FUQI at ten to fifteen, STEC at twenty. I had lost five hundred dollars of my thousand before I found this book and started reading it, with it, I was able to use it to catch the trend upwards on Borders Group and ALD from April to May which turned my five hundred into twelve hundred. Through a series of stocks, I'm up to nearly three thousand, I also put a little money in the account, about a hundred and twenty, for full disclosure, but this book is excellent. I understood it right off the bat, and along with William O'Neil, I have been very profitable. I bought fifty shares of STEC it up to thirty four, FUQI is up to twenty five and I bought a hundred shares of that. I'm up to nearly five thousand dollars. This small bull market has been doing me great, and I've been prospering in it, making sure to keep my stop losses reasonably close so not to give back all my profits. I have taken a lot of losses, nearly fifteen hundred dollars worth of losses, but I've always made that back with my winners. I was trading small cap until I had a good deal of money, and used to get stopped out at thirty five cents daily. This book should be required reading for anyone considering getting into stocks, its an uplifting story, its entertaining, its fun, it lets you get a good look into the work it takes to become very profitable in the stock market. The rules I come away from with this book are simple. 1: You're going to be wrong half the time if not more, so always make sure you cut your losses. 2: Only buy into rising stocks. 3: Use volume, new products, earning growth, and price to decide if the stock is about to move. 4: Never listen to the news or analysts, they're human and can be just as wrong as you, and their information is usually late and of no use. 5: Annual Reports and Company Records mean nothing about the companies future. I've used these rules and I plan to keep using these rules. This is an excelent book, and at 8.99,7.99, its too cheap not to buy.

Darvas' book flows along making it very easy to read and understand. I found this book to be inspirational. Darvas' system is nothing new or complicated. Considering he managed to find stocks that met his criteria without the aide of computers, easily accessible stock charts and scanning software, it is amazing he accomplished what he did. His approach, learned through trial and error - lots of error - was to look for a stock that was in a consolidation after a move up and then look for that stock to break out. He used price and volume to ascertain the breakout and patiently waited for confirmation by using what he termed, The Box Theory. This approach is not something revolutionary as it is suggested in most credible trading books. What makes this book special is how it is laid out in the easy to read story format. The book is more of a story rather than dry, jargon filled information. Obviously, Darvas was a very smart man and he was educated in finance and economics but as he humbly points out, he started like most traders - doing all the wrong things - and his results were like most traders, he lost his shirt. The sole advantage Darvas had over most present day traders is that he started with a substantial sum. His first stock was 6000 shares of a 50 cent Canadian stock. He got into owning this stock almost by accident but it turned out to be a very profitable trade and that got his curiosity going, From there he tried different thing until he formulated his theories and system. I enjoyed the book and already benefitted from the information presented therein. I would recommend this book to anyone whether they are a novice or an experienced trader. It more likely reinforces methods the reader is aware of instead of introducing a new system, but if the reader is smart enough to work with the same system until he becomes proficient, rewards will follow. Now that it has been a few days since I finished the book, I find myself reflecting back on the concepts and realizing what a great message this book offers. If I could give it 10 stars I would. A really terrific book.

I have a very special place in my heart for any book with "million" in its title. Perhaps this sum speaks to the greedy little capitalist in me. At the same time, my higher brain functions always kick in, and always being skeptical and somewhat leery of such tomes, I have to ask aloud, "OK, where's the gank (scam) here?" As it turns out, there is no catch, no scam in Darvas's delightful and entertaining little book on how he, by himself, stumbled upon an oft-tried (and somewhat true) trading strategy through admittedly much trial and much more error. Nowadays, I believe those in the know refer to it as momentum investing, but Darvas is arguably the first person who put the basic method on paper for the lay person to follow. Since he first published his book, there have been many imitators and would-be pretenders to the throne, such as Get Your Share: A Guide to Striking It Rich in the Stock Market , but none of these challengers has written a book as entertaining, accessible and straight-forward as this one. Withhout giving too much away, the book presents a method that pursues capital gain and relies heavily on the use of automatic buy and sell orders as a kind of insurance policy against catastrophic losses. As a precursor for using the method, one has to look for rising trends in a given stock, both in its price and trading volume. Truthfully, I found the narrative surrounding how he stumbled upon this simple and straight-forward (but difficult to successfully execute!) method more interesting and enlightening than the method itself. Potential readers and careful, thoughtful students of the market should take note of the following merits and demerits of the text. First, those of us who are fans of fundamental analysis are out of luck here; Darvas dismisses this pursuit as fool-hardy. Second, those of you who are fans of technical analysis (you FOOLS- shows where my bias resides, doesn't it?) will find precious little vindication within its pages. Darvas also basically dismisses technical analysis out of hand. Indeed, Darvas does not have very many kind words for securities analysts of all stripes- be they technicians or fundamentalists, and through carefully recorded experiences as his technique slowly evolved, he gradually develops a well-deserved contempt for hot tips (and the tipsters), the advisory rags, brokers and the casual musings of insiders and the so-called 'knowledge-able people' in business on where to invest. Finally, perhaps of greatest importance to those looking to use this method and maybe tweaking or modifying it is this: it apparently misses more often than it hits. Given the very real and crushing effects of transaction costs and taxes, one's grubstake can potentially suffer 'death by a thousand cuts'- a total capital loss inflicted by numerous small losses along the way. I heartily encourage non-believers to grab a copy of the book, and see for yourselves. Admittedly, trading costs and capital gains taxes were much greater in his day, but then, trading volumes were smaller and volatility, as measured among individual shares and by the broader market, was much more muted. Basically, after reviewing his trading record, one can clearly see that it relies on a few big hits to cover up many small misses. Plus, according to him, it requires hours of poring through lots of boring stock tables filled with numbers, making lots of charts, and most unpleasant for me, daily communication with one's broker. It all sounds like a lot of activity for maybe, possibly a big score, over and above the demands of your day job (which in his case was the ever-strenuous professional dancing at night). In sum, I found the author's remarks on the markets very amusing. Moreover, I deemed quite a few of his hard-won and independently derived (but by no means original) insights very worthwhile. Many of the latter have support from no less than super-investors like Gerald Loeb, author of The Battle For Investment Survival , John Train, author of The Craft of Investing: Growth and Value Stocks * Emerging Markets * Funds * Retirement and Estate Planning and the various writings of Warren Buffett. This book deserves to be read, and the author gets my respect partly for its candor (he presents the full record of his trades, good and bad, in all their painful glory), partly for its wit and borderline uber-jaded sarcasm with regard to markets and brokers, but mostly because the author did the hard work of thinking and learning independently, doing things on his own, taking his lumps with honesty, clarity and grace, and best of all, admitting his basic humanity (laying bare his foibles, his misguided arrogance in the face of the market and his fool-hardy notions). As such, he has about him the glimmerings of an unabashed, unrepentant contrarian.

I would rate this book as a solid 4 or 5, with the sole asterisk being to know what you are getting into. This is an incredibly conversational and personal book from someone who, while claiming to have read a great deal on his own, is not exactly selling a system and does not claim to have any certified or official education. He first talks about just fundamentals and his go at that, but he says that even a stock that looks great from that standpoint can fall immediately and irreparably, as many of us have no doubt found to be the case. He then talks about technical analysis, combining price momentum and irregular volume, similar to those such as Mark Minervini and William O'Neil. Also similar to them is the fact that he clings to stop-losses to force him to sell; unlike them, he often keeps these stop-losses tighter than 8%, but then at other times can give over 10%, depending on the stock. Like them, he also tries to identify buy-points, but it sounds less like he believes it's an iron-clad "this is the exact buy-point" system. Instead he talks about boxes, which sound like small troughs or even bases within a tight range of between 5 and 15%. Also, similar to at least Minervini, every successful stock owned by Darvas had already increased at least 100% within the prior year (although he does not point this out--I noticed it--and it was never claimed to be part of his system, whereas Minervini himself points it out). Lastly, as one reviewer pointed out, Darvas benefited from an option program that either does not occur anymore or certainly does not occur commonly, especially for someone not looking for it, and further, he embraced the margin. As I recall, margin has been embraced by O'Neil and Minervini, but many novice or cautious investors will not want to do that, even with capital-saving stop-losses. That is where the similarities end, though. O'Neil and Minervini go into much greater detail on earnings, earnings surprises, market direction, and numerous other things. Darvas seems to admit his focus on just a few small factors--namely, price momentum and rising volume. Beyond that, his tip is to not pay too much attention to your stocks or you'll freak out and do too much. One thing that I do have to credit this book for, which Minervini did well but O'Neil has not in any book of his that I have read, is to give the confidence to use stop-losses right. The point here is that Darvas admitted that even when you do everything right, you may be stopped out of a stock even the same day as buying it, and then you may still want to buy it after that. With some, the mentality seems to be, "well, you're getting stopped out and you aren't very good, but you're at least limiting how bad you are, so that's something." Here, the mentality is more, "these things don't always work and your charge is to follow your system. If it rises, raise your stop in time. If it falls, then you're just following the rules. Good."

I first found a dog-eared paperback copy of this book in a second-hand bookstore in about 1980. I'm sure it cost me less than one dollar. As the great bull market began in August 1982, the Darvas method was an ideal way to get onboard. My return on investment in that book was truly astronomical, even though I modified the Darvas technique to suit my own personality. This is a wonderful story of an extremely talented and hardworking man. He is brutally honest in his self-examination of trading errors. At the same time he exhibits a charming exhiliration upon discovering the sources of his trading problems and their solution, which each time helps him refine his trading methodology. Many other reviewers have done a fine job of summarizing the book's contents. I have one contribution to make and that is Darvas' observation that detachment from the markets is very important to successful operation as a trader. Trend followers with a time frame measured in months or longer cannot improve their performance by watching intraday action, listening to CNBC, or allowing their ego to inflate along with their bank account. Those activities cut into whatever edge you may have, eroding confidence, instilling doubt and ultimately result in losing money. Darvas found this out himself when he went to Wall Street. Read his firsthand account in the book (Chapter 9: My Second Crisis) to learn more. I know this from firsthand experience, trading while living overseas, receiving my Wall Street Journal 3 days late, and submitting orders to my broker via Telex at night. Snap decisions were impossible, but it was easy to see the longer-term trend. At the time I thought this a disadvantage, but it proved a profitable method of trading. In a similar manner, 20+ years earlier, Darvas unwittingly traded best at a great physical distance from the markets, while on a world tour with his dance act, and later after his "second crisis" at a great psychological distance from the markets. The lesson: detachment is key for a trend follower. How I Made $2,000,000 in the Stock Market is a detailed and entertaining true story well worth reading by any investor. I have no hesitation giving it 5 stars.

I am a trader who is still seeking to establish a method that works for him. I had to radically change my approach about one year ago, as I, very foolishly, let the market whip me around the summer of 2011. The path and history the author had to take was reminiscent of mine (except for reaching $2 MM - yet!), and, so, it was very illuminating and encouraging. Some key insights for an individual investor are: - Never take big losses. Darvas had to struggle and lost when he was not doing right. But even then, he was able to limit the size of losses by getting out of losing positions relatively quickly (usually after a few points down). From what I read, he never averaged down, and remained very disciplined. Averaging down or sticking with losing positions is, as Darvas says, a pure gamble that should never be allowed. I had to admit this was one of my most egregious mistakes till a year ago. - Study price charts carefully. Be patient and observant, and let the market (- not news media) tell you new trends. Become a partner with the smart money that moves the market and identifies leaders. Again, until a year ago or so, I was too anxious to find and enter market bottoms - such a useless exercise! - Let winners run as long and far up as possible. You must learn how to keep winning trades if you want to make big profits. I tend to get too nervous and be quick to close winning positions, only to realize later that it was just a minor correction. I still think, though, it's good to take some profit if your gains get huge in order to secure a psychological advantage, but you will need to see whether your stock's character still remains OK to hold. Lastly, I read this book because it was one of the readings suggested by Daniel Zanger (- Google him), and I agree it is totally worth reading for all swing traders. For me, this book was an affirmation of the direction where I'm seeking to establish my trading method.

This is more of a story about a retail investor and how he approached the market than it is a how-to and/or analytical book for professional advice. Darvas, a dancer, started out like anyone else -- he wanted to make a couple of bucks in his spare time. Who doesn't? As I read how he described his beginnings, I couldn't help but feel that they were similar to my own. All of the machinations of how a newb starts out in the market were there: his early successes; his failures; his experimenting with different approaches; his testing out of different theories; and his dealing with his emotions when sitting on large losses and gains. Throughout the book, Darvas is clear in stating that he was successful because he ignored conventional wisdom by developing his own methods, of which a large component was his use of a box system. It is similar to how modern charting works, mixed with a hodgepodge of technical analysis, momentum trading and price action. However, his methods aren't fully fleshed out, so it feels like part of the story is missing. And, since his approach isn't solely based on fundamentals, one can't help but get the sense that it was still an amalgam of guess work, gambling, and luck, no matter how much he wants to assuage you that his method was built on more solid ground. As much as the above is true, it was impressive how he made his money in a day and age where he had to do everything with a pen and pad + newspapers and over cable wires. Yes, yes, those cable wires! I have to say, having never been a fan of using stop losses, I did walk away with a new appreciation for them thanks to Darvas. Ultimately, "How I made $2,000,000 in the Stock Market" was an easy read, and an OK read, so why not?

What this book is about: Simply put, it walks through one man's adventures getting rich in the stock market. He starts making an accidental small fortune (he was paid in stock that took off in value before he even knew anything about the stock market), immediately sees the value in the stock market he has ignored his whole life, and then begins his learning process from there. I saw some reviews that state that he never explains how he gets his "feelings" about stocks to pick. Well, he does actually. What he explains in the book is that he looked for stocks that were resisting the declining indexes and he reasoned these stocks would be the ones to take off when the market recovered. This is where he developed what he felt was his "sixth sense" after awhile, where he could begin to see these stocks without tons of effort. This book was written in the 1950s, so it is certainly dated. There are concepts that I think we can all apply to our trading though. The symbiosis of technical and fundamental investing is something I've thought about in the past but never really made any serious attempt at developing a system for. Well that's what Darvas does after a fashion. And what could really be more powerful than that? Combining the best of both worlds to come up with a unique system of your own that no one else is doing (or maybe some are doing but they aren't sharing the knowledge). Anyways, it's a great read. The real value of books like this, in my opinion, isn't that they walk you through by the hand and explain how to do this stuff --- it's that they get your mind thinking in different directions. Rich Dad / Poor Dad was the same way for me. This book had more "meat" to it that Rich Dad / Poor Dad, however. By that I mean that it feels like there is more real life stuff you can start exploring right away in the stock market that Darvas's book will help you think about.

Um dos melhores livros sobre relatos de casos de sucesso em investimento! A leitura é simples, direta e bem fluida, o Sr. Darvas vai direto ao ponto e detalha cada operação sua sem a enrolação costumeira que alguns traders apresentam para falar de sua história, tanto é que ele mostra de forma bem objetiva seus trades fracassados. O que chama atenção nesse livro é que apesar de ter se tornado um excelente trader, o autor não parece longe da dimensão humana: ele não foi uma máquina de fazer dinheiro ambulante, mas uma pessoa comum que persistiu na ideia de enriquecer no mercado de ações e conseguiu. Recomendo a leitura como hobby ou parte do processo de aprendizado, vale a pena!

libro storico che illustra una tecnica di investimento long only che può dare i suoi frutti e che rimane ad oggi ancora valida, lettura interessante e istruttiva.ottimo libro.

A very relatable story for any retail trader. The struggles, the strategy hoping, the constant small or even relatively big successes that get crushed again and again for whatever reasons. But above all, the passion for trading and the drive to keep going, finding something that resonates and makes sense to you personally. If anything it reveals that you're not alone in your quest to finding profitability and everything that comes with it.

This book is very informative for a new trader. Presents the possibility for any person to become a trader or investor, as long as, you are willing to do some study, dedicate time and effort. Learn from your mistakes and keep learning with a realistic and positive attitude. I would recommend this book to anybody who wants to have some exposure to a great investment mind. Cheers

Une histoire incroyable qui nous rappelle encore une fois les règles élémentaires du trading et l'importance de l'analyse technique ... validée d'un contrôle des fondamentaux. À lire sans aucun doute.