Summary: Achieving superperformance in stocks requires understanding catalysts behind huge gains and being cautious of crowded trades. Selling at the right time can secure profits, especially when fundamentals deteriorate or a stock fails to behave well. Successful stock trading hinges on strong earnings growth, trend analysis, and timely decision-making.
Highlights
Two things are required: a desire to succeed and a winning strategy. In (View Highlight)
Success requires opportunity. The stock market provides incredible opportunity on a daily basis (View Highlight)
To spot them and take advantage of their success you must have the know-how and the discipline to apply the proper investment technique (View Highlight)
Dedication and a desire to succeed are definitely requirements to achieve superperformance in stocks. (View Highlight)
Ignore any discouragement you may encounter and pay attention instead to the empowering principles (View Highlight)
Finally, I came to realize that what I was most passionate about was freedom—freedom to do what I want, when I want, where I want. (View Highlight)
My philosophy and approach to trading is to be a conservative aggressive opportunist. Although this may seem like a contradiction in terms, it is not. It simply means that my style is to be aggressive in my pursuit of potential reward and at the same time be extremely risk-conscious. (View Highlight)
How much can I lose?†not just “How much can I gain?â€
During my 30 years as a stock trader, I’ve discovered that a “risk-firstâ€
approach is what works best for me. (View Highlight)
was able to accomplish the most important goal of all: to protect my trading account and keep the profits I made during the previous bull markets. (View Highlight)
Right now,somewhere out in the world someone is tirelessly preparing for success.
If you fail to prepare, that somebody probably will make big money whileyou only dream about what you could have been and should have done.
So prepare, prepare, prepare, because when opportunity knocks, which it definitely will, you want to be there to answer the door (View Highlight)
For me, the greatest success came when I finally decided to forget about the money and concentrate on being the best trader I could be. (View Highlight)
Note: I think all things permanent usually have this factors where you don’t need anyone’s permission?
“It’s better to do something imperfectly than to do nothing flawlessly.†An ounce of action is worth pounds of theory. (View Highlight)
Note: An ounce of action worth pounds of theory.
An ounce of action worth pounds of theory.
A pounds of theory worth an ounce of action.
So if you don’t know what to do, read and learn as much as possible until you can do an ounce of action.
If you begin to do it, maintain the flow and passion of doing it.
Only supplement with more theory when you’re done or can’t get any further of action
discipline, the ability to consistently execute a sound plan and refrain from self-defeating behavior. (View Highlight)
If you think stock trading is gambling, I suppose you could say the same thing about brain surgery (it certainly would be a gamble if I were performing the operation). To a trained surgeon with the necessary expertise, though, it is a job with risks that are offset by knowledge, training, and ultimately skill. Stock trading is no different. (View Highlight)
It is the greatest game on earth, and for me it has proved to be the greatest business opportunity on earth. (View Highlight)
To realize profits from investing in stocks, you must make three correct decisions: what to buy, when to buy, and when to sell. (View Highlight)
There isn’t a person anywhere who isn’t capable of doing more than he thinks he can.
—Henry Ford (View Highlight)
Note: Also related to my mental models, where “The most accountable person in your individual POV is Yourself”
carefully study the characteristics and behavior patterns of superperformance stocks (View Highlight)
develop the emotional discipline to execute a winning plan. (View Highlight)
Largely, it boils down to the fact that few individuals truly believe they can achieve superperformance in stocks. (View Highlight)
Note: You need to believe in it, visualize it, and imagine the idea of your achieving superperformance in stock trading.
You Can Start Small
A new idea is delicate. It can be killed by a sneer or a yawn; it can be stabbed to death by a quip and worried to death by a frown on the right man’s brow.
—Charles Brower (View Highlight)
When I asked him why he gave up, he told me that another friend had told him he that couldn’t do it because his trading capital was too small and that he was wasting his time. Discouraged, my friend just gave up. (View Highlight)
I started with just a few thousand dollars, and within just few years it grew to more than $160,000. A year later it was at half a million. With a decent bankroll at last, I was able to parlay my winnings into my personal fortune. (View Highlight)
“All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope. (View Highlight)
Wall Street never changes, the pockets change, the stocks change, but Wall Street never changes, because human nature never changes.†(View Highlight)
However, stocks today rise and fall for the same basic reasons as they did before: people drive stock prices, and people are basically the same emotionally. Trading can get very emotional, and emotions can easily lead investors to false conclusions. (View Highlight)
On the basis of 30 years of personal experience and historical analysis ofevery market cycle going back to the early 1900s, I can assure you that nothing has changed very much. In fact, history repeats itself over and over. (View Highlight)
Fortunes are made and lost time and time again for the same timeless reasons. One thing you can count on is that history will repeat itself. The only question is: How good a student are you?
Your Greatest Challenge Is Not the Market (View Highlight)
The world is full of people looking for a secret formula for success.
They do not want to think on their own; they just want a recipe to follow. They are attracted to the idea of strategy for that very reason.
—Robert Greene (View Highlight)
it’s within you, and it will be realized only to the extent that you are able to control and direct your emotions as you encounter challenges, of which I assure you there will be many. You might as well know that at the start. Otherwise, you’ll only be chasing false hopes. (View Highlight)
Have confidence in your ability. Learn to do your own research and think for yourself. Your own resources are far superior to outside research, tips, and so-called expert opinions because they’re yours and therefore you can keep tabs on them. (View Highlight)