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17 Points from William J. O’Neil

  
  Education
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READITWilliam O’Neil is likely one of  the greatest traders of our time based on many things. O’Neil made a huge amount of money while he was only in his twenties, enough to buy a seat on the New York Stock Exchange. He runs an amazingly successful investment advisory company to big money firms. He is also the creator of the CAN SLIM investment strategy which the American Association of Individual Investors named  the top performing investment strategy from 1998 to 2009. This non-profit organization tracked more than 50 different investing methods, over a 12 year time period. CANSLIM showed a total gain of 2,763% over the 12 years. The CAN SLIM method is explained in O’Neil’s book “How to Make Money in Stocks”

Those closest to O’Neil that have seen his private trading returns say that they are greater tna Warren Buffett of George Soros over the same period of time. Here are some of the best things that he is quoted as having said.

RISK MANAGEMENT

  1. I make it a rule to never lose more than 7 percent on any stock I buy. If a stock drops 7 percent below my purchase price, I will automatically sell it at the market – no second-guessing, no hesitation.
  2. Some people say, “I can’t sell that stock because I’d be taking a loss.” If the stock is below the price you paid for it, selling doesn’t give you a loss; you already have it.
  3. Letting losses run is the most serious mistake made by most investors.
  4. The whole secret to winning in the stock market is to lose the least amount possible when you’re not right.

METHOD

  1. 90% of the people in the stock market, professionals and amateurs alike, simply haven’t done enough homework.
  2. The first step in learning to pick big stock market winners is for you to examine leading big winners of the past to learn all the characteristics of the most successful stocks. You will learn from this observation what type of price patterns these stocks developed just before their spectacular price advances. (more…)

Warren Buffett Nails It On The Importance Of Luck In Life

  
Education, Life
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WARREN BUFFETT: Well I came up with that a long, long time ago to describe the situation that – I was lucky. I was born in the United States. The odds were 30 or 40-to-1 against that. I had some lucky genes. I was born at the right time. If I’d been born thousands of years ago I’d be some animal’s lunch because I can’t run very fast or climb trees. So there’s so much chance in how we enter the world. And –

LIU: And you were always aware to make sure your children and their grandchildren, and your grandchildren would be grounded.

WARREN BUFFETT: Yes. And we’re not – how you came out of the womb has really nothing to do with what kind of person you are. You decide what kind of person you’re going to be. It does decide whether maybe you never have to do an item of work in your life and maybe determine whether you’re fighting uphill all of the time, but where in my life, in my eyes is we’re all created equal, and but we don’t all have an equal opportunity by a longshot. And my kids really work every day in trying to even up the scorecard.

Luck plays a big role in life.  But you also get to choose how you’re going to use that luck and whether you want to try to make more of your own luck.

Mood Swings

  
  Education
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moodswing

If you do experience mood swings around losing trades, it’s probably because you are evaluating yourself by the criterion of being right–not by the criterion of trading well. It isn’t the losing trade making you feel bad; it’s the perfectionistic expectation that you should always be right. By embracing uncertainty and staying open to learning from it, the threat of losing can turn into the opportunity of rethinking market assumptions.

Happy New Year -2010

  
Education, Life
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31964

Updated at 12:02/1st Jan’10

My New year resolutions of 2010

1. Earn more money. Money money. To support family and life.

2. Of course a good career is neccessary.

3. Without the most important aspect of life — health, point 1 and 2 is useless.

4. Above all, spiritually blessed by God.

 5. Lead a simple life. Be contended.

6. More time with family spending quality time with parents, wife and brining up
children.

7. More time with good friends and relatives. Socialize.

8. Have extra spare cash. Be charitable.

9. Have a passive income to be financially independent

10. Be a charisma person.

My New Year’s resolutions for Trading

Trade less. Exercise more patience.

Be patient, buy right and buy big.

Be sure, be not afraid.

Don’t sell out on fear at the bottom of corrections.

Only make pre-planned trades; do not chase the “stock of the day” (more…)

Self-esteem in Trading -Anirudh Sethi

  
Analysis, Education

Image result for Self-esteemAs a trader you are going to be faced with countless issues. There is the trading world itself, fraught with risks and uncertainties. There are other traders who will be having an impact on the way you think as you might easily be tempted to do what the majority of doing. There is your own mind which will be telling you to act in a certain way, and yet your perceptions, emotions and sentiments may be trying to sway you in a different direction. There is the fear of losing money, which will possibly make you over cautious. Or else your ego which makes you take un neccessary risks because you are too sure of your judgment. All of these aspects are going to affect you in various ways and it is thus going to be very difficult to ensure that you make a well informed decision that will turn out to be the best one.

However besides all of these factors there is also a very powerful underlying factor which will be there throughout. This is your self-esteem. This is basically how you feel about yourself. How do you perceive your skills and knowledge as a trader? How sure of yourself and particularly of your judgment you are? How tempted do you feel to doubt your thoughts and to reconsider your actions? Do you take too long to make a move, only to end up being too late? Your self-esteem is going to be there practically just like an underlying foundation for your decisions in the trading world. And if you do not manage to consider its presence, and its effects, you might easily end up making erroneous decisions often.

Overcoming self-esteem issues is critical if you want to be able to trade successfully. Subconsciously we estimate ourselves, by evaluating our personality, our skills and capabilities – and we may either over estimate ourselves or under estimate ourselves. This is what self-esteem is all about. As a result of this evaluation of oneself, one develops an attitude towards oneself. Hence a balanced self esteem is key if one wants to trade successfully. (more…)

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