The Dancer Who Became a Millionaire Trader
This was cured when he returned to his original analysis technique, away from rumours and market news:
It dawned on me like a revelation that when I was travelling abroad I had been able to assess the market, or rather the few stocks in which I was interested, calmly, neutrally, without interruption or rumour, completely without emotion and ego.
Once this was resolved, Darvas moved ahead again, and achieved the $2,000,000 mark with his trading, before writing his book. He died in 1977 after retaining and increasing his wealth in both stock trading and other business ventures.
Conclusion
Nicolas Darvas achieved an amazing feat with his trading. It catapulted him from obscurity to wealth and fame. We can take away some of his ideas. Darvas boxes are as valid a technique as they were in his day and are an effective noise filtering technique. Darvas boxes can be used for options, futures and forex trading.
Focussing on stocks in sectors that show earnings growth and relative strength is also important.
He realised that thinking independently was a critical success factor. Darvas began to lose when his emotions and ego got in the way. He solved this problem by reducing the amount of information he was processing, and refocussed on his technical and fundamental analysis rather than on the words of others.
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Tags: Darvas box, Nicolas Darvas, Trader biography