Includes index

Foreword; Preface to the Second Edition; Preface to the First Edition; Acknowledgments; Part One: The Most Important Factor in Your Success: You!; Chapter 1 The Legend of the Holy Grail; The Holy Grail Metaphor; What's Really Important to Trading; Modeling Market Geniuses; Chapter 2 Judgmental Biases: Why Mastering the Markets Is So Difficult for Most People; Biases That Affect Trading System Development; Biases That Affect How You Test Trading Systems; Biases That Affect How You Trade Your System; Summary; Chapter 3 Setting Your Objectives. Designing Objectives: A Major Part of Your System WorkTom Basso on Objectives; Setting Your Own Objectives; Part Two: Conceptualizing Your System; Chapter 4 Steps to Developing a System; 1. Take an Inventory; 2. Develop an Open Mind and Gather Market Information; 3. Determine Your Mission and Your Objectives; 4. Determine the Concept That You Want to Trade; 5. Determine the Big Picture; 6. Determine Your Time Frame for Trading; 7. Determine the Essence of Your Trading and How You Can Objectively Measure It; 8. Determine What Your Initial 1R Risk Will Be. 9. Add Your Profit-Taking Exits and Determine the R-Multiple Distribution of Your System and its Expectancy10. Determine the Accuracy of Your R-Multiple Distribution; 11. Evaluate Your Overall System; 12. Use Position Sizing to Meet Your Objectives; 13. Determine How You Can Improve Your System; 14. Mentally Plan for Your Worst-Case Scenario; Chapter 5 Selecting a Concept that Works; Trend Following; Fundamental Analysis; Value Trading; Band Trading; Seasonal Tendencies; Spreading; Arbitrage; Intermarket Analysis; There's an Order to the Universe; Summary. Chapter 6 Trading Strategies That Fit the Big PictureThe Big Picture as I See It; Factor 1. The U.S. Debt Situation; Factor 2. The Secular Bear Market; Factor 3. The Globalization of Economic Factors; Factor 4. The Impact of Mutual Funds; Factor 5. Changes in Rules, Regulations, and Taxes; Factor 6. Human Beings' Tendency to Play a Losing Economic Game; Other Areas You Might Consider; How Will You Monitor the Big Picture?; Summary; Chapter 7 Six Keys to a Great Trading System; The Snow Fight Metaphor; Looking at Expectancy under a Magnifying Glass; Opportunity and Expectancy. Prediction: A Deadly TrapReal Trading Applications; Determining How Your System Will Perform; Summary; Part Three: Understanding the Key Parts of Your System; Chapter 8 Using Setups to Jumpstart Your System; The Five Phases of Entry; Setups for Stalking the Market; Filters Versus Setups; Setups Used by Well-Known Systems; Summary; Chapter 9 Entry or Market Timing; Trying to Beat Random Entry; Common Entry Techniques; Designing Your Own Entry Signal; An Evaluation of Entry Used in Some Common Systems; Summary; Chapter 10 Knowing When to Fold 'Em: How to Protect Your Capital.