The following list outlines great lessons from wall street legends, regardless of their investment style or background (these are not in any particular order):
- Trade on what you see happening, not on what you think will happen. (i.e. trade in the now)
- Always keep your losses small and never argue with the market, you will always lose.
- You don’t need to a lot of money to do well, you need to have rules and follow them!
- Only trade when you have an edge. If your edge is not clearly defined- stay away.
- Develop a sound set of money management rules.
- Focus on what matter most, your bottom line.
- All your positions should pay you to be involved. If they don’t, something is wrong. (this doesn’t only go for stocks that pay a dividend. This means that when you buy a stock, it should go up soon after you buy it)
- Study and learn history, otherwise you are doomed to repeat it.
- Take responsibility for all your actions, do not make excuses.
- Do not try to pick tops or bottoms, instead capture the bulk of the move.
- No one gives permission. Seize the moment.
- Do more of what works and less of what doesn’t.
- Hard work, focused dedication and drive are vital to being successful.
- Post analysis- be your biggest critic.
- Plan for every possible outcome, then trade your plan.
- Separate your emotions from your decision making process.
- Be positive and happy. Develop a spirit of opulence. Life (and the market) is full of good.
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