Stock Market Rules

PART I: Research 

1. Get Information Before You Invest, Not After 

2. Price Doubling Is Easier at Low Prices 

3. Good Companies Buy Their Own Stock 

4. Heavy Volume, the Price Rises—Light Volume, the Price Falls 

5. Watch the Bellwethers

PART II: Analysis 

6. It’s Always a Bull Market 

7. Look for Divergence in Trends 

8. A Trend Remains in Force Until It Changes 

9. Look for Insider Trading 

10. Know the Best Type of Order 

11. Institutions Show Where the Action Is Now 

12. It Depends on Support and Resistance 

13. There Is a Bear Market Coming 

PART III: Strategy 

14. Invest According to Objectives 

15. Sell the Losers and Let the Winners Run 

16. Buy Low, Sell High 

17. Buy High, Sell Higher 

18. Sell High, Buy Low 

19. Never Short the Trend 

20. Make Winners Win Big 

21. Buy on the Rumor, Sell on the News 

22. Buy the Stock That Splits 

23. Buy on Weakness, Sell on Strength 

24. It’s Better to Average Up Than Down 

25. Buy on Monday, Sell on Friday 

26. Buy Stock Cheaper with Dollar Cost Averaging 

27. The Perfect Hedge Is Short Against the Box 

28. Diversification Is the Key to Portfolio Management 

PART IV: Trading 

29. Never Short a Dull Market 

30. It’s Best to Trade at the Market 

31. Never Buy a Stock Because It Has a Low Price 

32. Buy the Dips 

33. Order Modifications Might Cause Delay 

34. Avoid Overtrading 

PART V: Good Ideas 

35. Follow a Few Stocks Well 

36. Never Get Married to a Stock 

37. Act Quickly, Study at Leisure 

38. Records Can Make Money 

39. Invest in What You Know Best 

PART VI: Caution 

40. Give Stop Orders Wiggle Room 

41. Indicators Can Meet Overriding Factors 

42. Beware the Penny Stock 

43. Be Wary of Stock Ideas from a Neighbor 

44. Heavily Margined, Heavily Watched 

45. Beware the Triple Witching Hour 

PART VII: Surprises 

46. Avoid Heavy Positions in Thinly Traded Stocks 

47. Fraud Is Unpredictable 

48. There’s (Almost) Always a Santa Claus Rally 

49. A Stock Price Splits When It Gets Too High 

50. Join the Club