"Who Else Wants Their Share of Stock Trading Riches?"

"I Can Give You a Simple, but Powerful Formula that Transforms Your Stock Picks into Money Pumps."

Now available from Amazon.com


In the last couple of years, I have become passionate about sharing my stock trading system with others.  I am disillusioned with the stuff out there:

99% of all systems use the same old indicators.
99% of all trading books say "the trend is your friend".
99% of traders fail to beat the markets.

The brutal fact is that a free market is about price discovery.  A market works like an organism - "consuming" new fundamental and technical information and rendering it ineffective.

A 30-day moving average may make money for a while.  Then the market will "digest" this parameter, and a 65-day moving average may become the new money-maker.  

Today's report on CNBC is already reflected in the price of the stock.

Only 1% of traders are superstars who can consistently find, re-adjust and exploit new information.

"Book is very precise and clear.  Easy to read and understand...retirement we will use it."      Jeff E.      Buffalo Grove, IL

Zen Simplicity

 
The Big Secret for the "little guy" trader is simplicity.

You need a system that is flexible and robust - that does not depend on the market moving in trends, or creating chart patterns.

I developed my system after I became fascinated with the idea of a pure Zen trading system.  It would use no news reports, indicators, charts, or parameters to distract you from Now.  It would be able to handle any market condition.

I went beyond traditional finance - I turned to jazz, improvisation, Taoism, simplicity, and minimalism for inspiration.

Analog in a Digital World

 
I made a break-through when I shifted my mind-set from digital thinking to analog.

A digital system has two values (i.e. yes or no), while an analog system has a range of values.  For example, a computer memory bit can only be off or on, but your oven can be set to a range of temperatures.

Normally, we trade digitally.  After we buy a stock, we either hold it or sell it.  So, for the trade to make us money, we only have one chance to buy the stock correctly, and then one chance to sell it correctly.

The trading system I ended up developing is analog.   After you initially buy into a stock, the "magic" formula automatically uses feedback to adjust the position - buying and selling portions of your holdings.  It works like a self-correcting gyro control in a torpedo.

A Successful Trader

 
Since I developed my system, I can hardly describe how my trading career has changed.  While I’m no financial genius like Warren Buffett, I now have a simple and elegant approach to the stock market that gives a great return without undue risk. 

In fact, I have made a double-digit annual return for years now (with the caveat that I can make no guarantees about future performance).

I love trading with my system.

I have no expectations.  I am in a very powerful position.  The market can’t "digest" my system – because my system works in any market - bull, bear, trending, and random choppiness.

I no longer suffer from trading system "promiscuity".  I can resist the urge to "tinker", "tweak", and "optimize" my system.

Trade Formula in Action

 
Let’s look at an example of the formula.

We will use Amazon.com (AMZN) split-adjusted prices for the first trading day in each January, from 2000 to 2007.

Now, most trading system sales letters show favorable examples.  If the system is trend-following, they show trades in trending markets.

I'd rather show you the downside.  My system is like old school smash-mouth Bears football.  It wins through defense - it protects the downside.

So, let’s pretend that we initially bought 30 shares of AMZN at $64.56 in January, 2000. 

Since my trading system only goes long (i.e. it does not sell stocks short), this was the WORST possible time – just before the dot-com bubble burst. 

We then turned over the management of this position to my formula.

Here are the buys/sells that the formula would have recommended on the first trading day of each year:

(Remember that past performance is no guarantee of success).

Even though AMZN went down 42% from 2000 to 2007, the formula is up 36%.  It mechanically “self-corrected” our bad timing.

Portfolio Management

The formula is the heart of my trading system, but it is insufficient by itself.  Anything can happen to an individual stock. 

 The key is that my formula is layered inside a portfolio management system.  The formula takes advantage of each stock’s volatility, while the portfolio layer handles risk, diversification, and growth.

About The Author

Over the years, Praveen Puri has developed a passion for simplicity, minimalism, and Eastern philosophy.

He also has had a lot of financial and trading experience:

• He has traded his own account for almost 20 years.

• As a consultant for a large insurance company, he helped design and implement custom software to track a $30 billion investment portfolio.

• As a consultant at the Chicago Board of Trade (CBOT), he helped support and develop their "Project A" electronic trading platform.

• He is currently a vice president at a major bank, where he supports and develops FX systems for corporate clients.
  

Praveen lives in the Chicago area with his wife (Rasika), son (Anshul), and 2 cockatiels (Mickey and Donnie).

Get Rich Slowly

 
If someone had handed me this formula when I was younger, I would not have used it, because I wanted to get rich quick – I wanted "action" and triple-digit returns.

Now I understand that those kinds of systems are unsustainable. 

For example, Forbes Magazine, which caters to the wealthy, never advocates futures trading as a wealth-building tool.  Instead, they mention futures only as a diversification tool for very large portfolios – where the contracts are bought without using margin, and can be rolled over (thus making them like stocks).

Now I see the value of my system.  Instead of "get rich quick", this is a sustainable system with an edge - because it buys low and sells high.

Like a casino, I now want to unemotionally pound away with this edge.

My system also scales up.  It can manage $10,000 or $10 billion.

Build A Dynasty

 
Instead of becoming an instant millionaire on one spectacular day-trade, here is what I now dream about:

I would build up my wealth, and then pass this formula down to my son as a legacy.  He would use it to add on to the family wealth, and then pass it along to the next generation, etc.

My family would build real wealth in 2-3 generations. 

Centuries from now, I am remembered as the founder of the family dynasty.

It might sound corny but, which is more realistic and doable?

Bonuses

 
The book includes awk and perl scripts that can be used, along with free data from BarChart.com, for testing the Stock Trading Riches formula.  

The book both prints the scripts and includes links to where they can be accessed online.

New!  The Stock Trading Riches formula is also now available as a Microsoft Excel spreadsheet.  This spreadsheet can be downloaded from http://www.StockTradingRiches.com/word.html - where "word" is the third word in the first paragraph on page 12 of the book.

Questions

 
If you have any questions about the book or trading system, please feel free to email me at StockTradingRiches [at] yahoo.com.