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Market Wizard Richard Dennis was a legendary commodities trader nicknamed the “Prince of the Pit.” Early in his trading career in the 1970s, he was loaned $1,600 and is said to have grown it into $200 million in approximately a decade of trend following trading. He traded a lot of breakouts and momentum signals in his time frame and would let his winners run. He traded with size and benefited from the leverage that futures contracts allowed him for huge growth and compounding of capital.
Richard Dennis also partnered with William Eckhardt to create the famous Turtle Traders program that set out to prove whether good traders could be trained or if they just had talent. The Turtle Traders program was both successful in training some world class traders that went on to manage their own funds and also found what appeared to be new traders with inherent talent for following systems.
Below are ten of the best trading quotes from Richard Dennis that can help you with the principles of profitable price action trading.
“A good trend following system will keep you in the market until there is evidence that the trend has changed.” – Richard Dennis
“Trading has taught me not to take the conventional wisdom for granted. What money I made in trading is testimony to the fact that the majority is wrong a lot of the time. The vast majority is wrong even more of the time. I’ve learned that markets, which are often just mad crowds, are often irrational; when emotionally overwrought, they’re almost always wrong.” – Richard Dennis
“You have to minimize your losses and try to preserve capital for those very few instances where you can make a lot in a very short period of time. What you can’t afford to do is throw away your capital on suboptimal trades.” – Richard Dennis
“I could trade without knowing the name of the market.” – Richard Dennis
“Trading decisions should be made as unemotionally as possible.” – Richard Dennis
“When you have a position, you put it on for a reason, and you’ve got to keep it until the reason no longer exists.” – Richard Dennis
“There is another point that I think is as important: You should expect the unexpected in this business; expect the extreme. Don’t think in terms of boundaries that limit what the market might do. If there is any lesson I have learned in the nearly twenty years that I’ve been in this business, it is that the unexpected and the impossible happen every now and then” – Richard Dennis
“The market being in a trend is the main thing that eventually gets us in a trade. That is a pretty simple idea. Being consistent and making sure you do that all the time is probably more important than the particular characteristics you use to define the trend. Whatever method you use to enter trades, the most critical thing is that if there is a major trend, your approach should assure that you get in that trend.” – Richard Dennis
“I always say that you could publish trading rules in the newspaper and no one would follow them. The key is consistency and discipline. Almost anybody can make up a list of rules that are 80 percent as good as what we taught people. What they couldn’t do is give them the confidence to stick to those rules even when things are going bad.” – Richard Dennis
When you are starting out as a new trader: “Trade small because that’s when you are as bad as you are ever going to be. Learn from your mistakes.” – Richard Dennis
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