Trading Risk: Enhanced Profitability through Risk Control

by Kenneth L. Grant

May 2005

A Worthy Investment

Note: as it stands, my review barely scratches the surface of this noteworthy book. I intend to return to here, and delve much deeper, at some point down the road. (Had we but world enough and time...)

My attitude towards trading books is this: if I come away with at least one good idea or useful insight, the cost of purchase is paid for a hundred times over. Ken Grant's book contains a handful of useful ideas for improving performance, and some interesting perspectives to boot. When someone has worked with the best of the best (Jones, Cohen, et. al) their views carry weight. Ideas aside, I found Grant's overall philosophy of risk to be worth the price of admission.

While the subject matter doesn't delve especially deep, this isn't a book for beginners. To fully appreciate the observations, a little seasoning is required. Grant speaks to those with a well developed respect for the markets, typically earned by grinding it out, experiencing the inevitable ups and downs over time, and taking a good hard knock or two. If you are a beginning trader still in the bright-eyed, bushy-tailed phase (having not yet received your first frying pan to the face), this book may bore you. If you are a crusader in search of the holy grail, or a techno-junkie hooked on chart patterns and oscillators, the lack of packaged advice may frustrate. But... if you have been around the block, seen the ups and downs, and love the game enough to make excellence and longevity your true ideals, then this book might be for you.

Another great thing about Trading Risk is the way new light gets shed on `dull' concepts. These are important ideas that routinely get the short shrift. Sure, you may know all about standard deviations and portfolio adjustment; but can you see the forest for the trees? Maybe yes, maybe no... but for those who say `nothing new here,' I question how hard they actually looked. Risk Management as an Investment—one of the book's key themes—is a rich concept with multiple layers, and well worth delving into.