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Trading Is A Business. Treat It Like One.

As I was preparing a presentation and looking for some interesting material I came across “Trader Vic – Methods Of A Wall Street Master” and this paragraph got my attention:

“I base my business philosophy on three principles, listed here in terms of importance: preservation of capital, consistent profitability, and the persuit of superior returns. These principals are basic in the sense that they underlie and guide all my market decisions. Each principle carries a different weight in my speculative strategy, and they evolve from one to another. That is, preservation of capital leads to consistent profits, which makes pursuit of superior returns possible.”

This was written in 1991 but I think its still a very valid proposition. I am also adding this line from the same book, “In my view, the way to build wealth is to preserve capital, make consistent profits, and wait patiently for the right opportunity to make extraordinary gains.”