Jesse L. Livermore
Candlefocus EditorLivermore quickly established himself on Wall Street, making risky and often large bets in order to maximize his profits. One of his biggest successes was short selling U.S. Steel stocks in 1901, predicting the downward trend of the market and earning a significant profit. Livermore was also known for his appetite for extreme risk. In 1907, he heavily borrowed money to make large bets on certain stocks and ultimately earned himself a fortune during a period of severe market crashes.
Livermore believed that the stock market was driven by price movements and not underlying values, but to this day his famous adage “Listen to the Tape” is still a mainstay in trading circles. This adage reflects Livermore's philosophy to pay attention to the actual movement of shares in the market rather than other market factors such as the fundamental value of the company.
Despite Livermore’s success, his attention-grabbing behavior and multiple losses throughout the years left him broke and consumed by his own ambition. Edwin Lefevre, a prominent financial journalist at the time, wrote a book about Livermore’s life in 1923 called Reminiscences of a Stock Operator. This book is considered a classic “must read” for any aspiring or professional trader.
Jesse L. Livermore is an icon in the history of Wall Street, his contributions to the world of finance and trading still having a lasting impact to this day. He remains an inspirational figure, teaching traders the valuable lessons of risk management, discipline and the importance of paying attention to the market's movements. Despite his successes and failures, Livermore will always be remembered as an ambitious and innovative investor, who forever changed the face of Wall Street.