Study Guide for Come into My Trading Room: A Complete Guide to Trading
Author: Alexander Elder | Categories: Trading Education, Trading Psychology, Technical Analysis, Risk Management
Executive Summary
"Study Guide for Come Into My Trading Room" by Dr. Alexander Elder is the companion workbook to his comprehensive trading manual "Come Into My Trading Room." Structured as a self-assessment and learning tool, the guide contains 100 questions organized across nine chapters that mirror the main book's coverage: financial trading basics, trading psychology (Mind), basic charting, technical indicators, trading methods, day-trading, advanced concepts, money management (Money), and the organized trader. Each question includes detailed answers with rating scales that allow readers to assess their mastery of Elder's trading methodology, including the Triple Screen trading system, the Impulse System, the 2% and 6% money management rules, and trading diary practices.
Core Thesis & Arguments
Elder's thesis in the study guide mirrors his main work: trading success requires integrated mastery of three domains - Mind (psychology), Method (technical analysis), and Money (risk management). The study guide format reinforces specific arguments: (1) Self-assessment is essential because traders often overestimate their knowledge; (2) Understanding concepts intellectually is different from applying them under market pressure; (3) The scoring system helps traders identify their weakest areas for targeted improvement; (4) Active learning through question-and-answer is more effective than passive reading; (5) Trading competence can be measured and improved systematically.
Chapter-by-Chapter Analysis
Chapter 1: Financial Trading for Babes in the Woods (Questions 1-8)
Tests understanding of fundamental distinctions between investing, trading, and gambling; the structure of markets; and the external barriers to success (commissions, slippage, the minus-sum game).
Chapter 2: Mind - The Disciplined Trader (Questions 9-18)
Assesses understanding of trading psychology, self-destructive patterns, emotional management, and the psychological maturation process that traders must undergo.
Chapter 3: Basic Charting (Questions 19-23)
Covers chart types, time frames, bar patterns, and the fundamentals of visual price analysis.
Chapter 4: Indicators - Five Bullets to a Clip (Questions 24-39)
The largest section, testing knowledge of Elder's preferred indicators: moving averages, MACD, Force Index, Elder-Ray, and others. Reinforces the principle that a small number of well-understood indicators is superior to many poorly understood ones.
Chapter 5: Trading (Questions 40-47)
Tests understanding of the Triple Screen trading system, entry and exit techniques, and trade management principles.
Chapter 6: Day-Trading (Questions 48-53)
Covers intraday trading methods, the Impulse System, and the Market Thermometer.
Chapter 7: Advanced Concepts (Questions 54-67)
Addresses more sophisticated topics including multiple time frame analysis, intermarket analysis, and advanced pattern recognition.
Chapter 8: Money Management (Questions 68-82)
Tests thorough understanding of the 2% Rule (maximum risk per trade) and the 6% Rule (monthly loss limit), position sizing, and equity curve management.
Chapter 9: The Organized Trader (Questions 83-100)
Covers the practical aspects of professional trading: spreadsheet tracking, trading diary maintenance, action planning, and the decision-making tree for trade execution.
Key Concepts & Frameworks
- The Three M's Self-Assessment: Rating scales for Mind, Method, and Money competencies
- 100-Question Mastery Framework: Systematic evaluation of trading knowledge and application
- Active Learning Through Testing: The pedagogical approach of testing for deeper retention
- Weakness Identification: Using scoring patterns to identify and address the weakest link in one's trading
- Integration Testing: Questions that require combining concepts from multiple domains
Practical Trading Applications
- Use the study guide as a pre-trading checklist to verify readiness before committing real capital
- Periodically retake the assessment to track improvement and identify emerging weaknesses
- Focus study time on the lowest-scoring sections for maximum improvement impact
- Use the detailed answers as reference material during live trading situations
- Share scores with a trading mentor or accountability partner for external feedback
Critical Assessment
Strengths: The study guide provides a structured, measurable way to assess trading knowledge that is rare in trading education. The questions are practical and application-focused rather than theoretical. The rating scales help traders objectively evaluate their readiness. The format encourages active engagement with the material rather than passive reading.
Weaknesses: The guide is only fully useful in conjunction with the main book, limiting its standalone value. The question format can feel academic and may not capture the emotional and psychological challenges of live trading. Some questions have debatable "correct" answers, as trading often involves legitimate differences in approach. The material is closely tied to Elder's specific methodology, which may not suit all trading styles.
Key Quotes
- "Test yourself to find out how much you really know."
- "The score reveals the weakest link in your trading."
- "No math illiterates - on the necessity of quantitative self-assessment."
Conclusion & Recommendation
"Study Guide for Come Into My Trading Room" is a valuable learning tool for traders who are working through Elder's methodology. Its greatest contribution is providing a structured self-assessment framework that forces honest evaluation of trading knowledge and readiness. While it must be used alongside the main book for full value, the discipline of testing one's knowledge before risking capital is a practice that all traders should adopt. Recommended for traders studying Elder's approach and for any serious student of trading who values structured, measurable learning.
