50 Time Tested Classic Stock Trading Rules

1. Plan your trades. Trade your plan.

2. Keep records of your trading results.

3. Keep a positive attitude, no matter how much you lose.

4. Don’t take the market home.

5. Continually set higher trading goals.

6. Successful traders buy into bad news and sell into good news.

7. Successful traders are not afraid to buy high and sell low.

8. Successful traders have a well-scheduled planned time for studying the markets.

9. Successful traders isolate themselves from the opinions of others.

10. Continually strive for patience, perseverance, determination, and rationalaction.

11. Limit your losses – use stops!

12. Never cancel a stop loss order after you have placed it!

13. Place the stop at the time you make your trade.

14. Never get into the market because you are anxious because of waiting.

15. Avoid getting in or out of the market too often.

16. Losses make the trader studious – not profits. Take advantage of every lossto improve your knowledge of market action.

17. The most difficult task in speculation is not prediction but self-control.Successful trading is difficult and frustrating. You are the most importantelement in the equation for success.

18. Always discipline yourself by following a pre-determined set of rules.

19. Remember that a bear market will give back in one month what a bullmarket has taken three months to build.

20. Don’t ever allow a big winning trade to turn into a loser. Stop yourself out ifthe market moves against you 20% from your peak profit point.

21. You must have a program, you must know your program, and you mustfollow your program.

22. Expect and accept losses gracefully. Those who brood over losses alwaysmiss the next opportunity, which more than likely will be profitable.

23. Split your profits right down the middle and never risk more than 50% ofthem again in the market.

24. The key to successful trading is knowing yourself and your stress point.

25. The difference between winners and losers isn’t so much native ability as itis discipline exercised in avoiding mistakes.

26. In trading as in fencing there are the quick and the dead.

27. Speech may be silver but silence is golden. Traders with the golden touch donot talk about their success.

28. Dream big dreams and think tall. Very few people set goals too high. A manbecomes what he thinks about all day long.

29. Accept failure as a step towards victory.

30. Have you taken a loss? Forget it quickly. Have you taken a profit? Forget iteven quicker! Don’t let ego and greed inhibit clear thinking and hard work.

31. One cannot do anything about yesterday. When one door closes, anotherdoor opens. The greater opportunity always lies through the open door.

32. The deepest secret for the trader is to subordinate his will to the will of the market. The market is truth as it reflects all forces that bear upon it. As long as herecognizes this he is safe. When he ignores this, he is lost and doomed.

33. It’s much easier to put on a trade than to take it off.

34. If a market doesn’t do what you think it should do, get out.

35. Beware of large positions that can control your emotions. Don’t be overlyaggressive with the market. Treat it gently by allowing your equity to growsteadily rather than in bursts.

36. Never add to a losing position.

37. Beware of trying to pick tops or bottoms.

38. You must believe in yourself and your judgement if you expect to make aliving at this game.

39. In a narrow market there is no sense in trying to anticipate what the next bigmovement is going to be – up or down.

40. A loss never bothers me after I take it. I forget it overnight. But being wrongand not taking the loss – that is what does the damage to the pocket book and tothe soul.

41. Never volunteer advice and never brag of your winnings.

42. Of all speculative blunders, there are few greater than selling what shows aprofit and keeping what shows a loss.

43. Standing aside is a position.

44. It is better to be more interested in the market’s reaction to new informationthan in the piece of news itself.

45. If you don’t know who you are, the markets are an expensive place to findout.

46. In the world of money, which is a world shaped by human behavior, nobodyhas the foggiest notion of what will happen in the future. Mark that word –Nobody! Thus the successful trader does not base moves on what supposedly will happen but reacts instead to what does happen.

47. Except in unusual circumstances, get in the habit of taking your profit toosoon. Don’t torment yourself if a trade continues winning without you. Chancesare it won’t continue long. If it does, console yourself by thinking of all the timeswhen liquidating early reserved gains that you would have otherwise lost.

48. When the ship starts to sink, don’t pray – jump!

49. Lose your opinion – not your money.

50. Assimilate into your very bones a set of trading rules that works for you.