Some rules for investing never get old. Here’s a list of 50 to guide your journey:
- If the reason you bought a stock no longer applies, sell it.
- Don’t blame the market for your mistakes.
- If you’re on the wrong train, get off before it costs you more.
- The stock market isn’t like horse racing—someone always wins in horse racing.
- Predicting a storm doesn’t matter if you’re not building an ark.
- Hot sectors lead to new funds, not for your benefit but because they’re easy to sell.
- If you don’t own stocks during downturns, you won’t own them when they soar.
- Hype stocks are a tax on people who don’t understand fundamentals.
- The market isn’t always efficient, but it’s still hard to beat.
- Don’t trade all the time.
- Leave your opinions out of your strategy.
- Only invest money you can afford to lose.
- Knowledge comes from experience, not just information.
- Hands-off portfolios often perform better.
- Cash isn’t trash—it’s an option for future opportunities.
- Crowds are often wrong in the short term but right in the long term.
- Dividends indicate value—profitable companies can pay them.
- Expose your portfolio to opportunities, not unnecessary risks.
- Avoid leveraged companies; instead, use leverage on solid ones.
- Optimists and pessimists don’t win—realists do.
- Simple models often work best.
- Popular stocks often fall; ignored ones can rise.
- Investing is about probabilities, not certainties.
- More stocks double in value than go to zero.
- Be bullish in a bull market.
- Be wary of stocks with names like “Universal” or “Global.”
- Economists rarely agree on anything.
- Betting on the next big thing isn’t investing—it’s gambling.
- We’ve faced scary news before and survived.
- Plan for likely outcomes and set realistic expectations.
- Study market history to understand possibilities.
- Economists love numbers, but they lack the flair of accountants.
- You’ll never have all the answers.
- Investing should feel boring; seek excitement elsewhere.
- Don’t wait to time the bottom—buy when there’s value.
- Watch for growth initiatives in companies.
- Time is an asset in investing—play the long game.
- Dull company names often hide great opportunities.
- Most market predictions are wrong at turning points.
- People forget to buy back after selling at a high.
- Falling markets often mean higher future gains.
- Invest in companies with irreplaceable products or services.
- Good businesses don’t rely on heavy borrowing.
- Time reveals what daily fluctuations can’t.
- A good outcome doesn’t always mean a good decision.
- The more data points you gather, the better your decisions.
- Investors often create theories to explain trends.
- A strong competitive advantage matters more than price.
- Find great businesses at fair prices, not mediocre ones on sale.
- Time is your biggest behavioral advantage in investing.