DeHaemer’s 55 Rules of Trading
Walter Sobchak was a character from the movie The Big Lebowski played by John Goodman if you’ve seen the movie you know that Walter understood that rules gave a person the guardrails needed to make it through the chaos of life.
We all need a moral code, an ethos. A family friend would always tell me, “Hammer, if you cheat at golf then you cheat at life and I won’t do business with you.” It speaks of character.
Walter, from the movie, said, “Nihilists! F*ck me. I mean, say what you want about the tenets of National Socialism, Dude; at least it’s an ethos.”
And “This is not ‘Nam. This is bowling. There are rules.”
Much in the way that Shakespeare produced brilliance when restricted to the 14 lines of a sonnet written in an iambic pentameter so too are traders enhanced by guardrails.
Over twenty years ago I wrote my world-famous 55 Rules of Trading after reading countless books on Wall Street. Here is the first of five parts:
Rule #1: The market is always right.
Rule #2: Never buy a company run by a medical doctor. Doctors have a confidence that is great on the operating table but lousy in running a company. Buy companies run by salespeople.
Rule #3: When investing in Canadian resource companies, assume they are scams unless proven otherwise.
Rule #4: When a disaster occurs in an emerging market country, find the company that has sold off the most and trades as an ADR in the U.S. Buy it.
Rule #5: It is better psychologically not to make money than to lose it, but you have to take risks.
Rule #6: Always leave money on the table.
Rule #7: Never apologize for a profit.
Rule #8: After you sell a position, take the ticker off your most wanted screen and put it on your sold screen. You made your choice, you don’t need to look at it constantly.
Rule #9: If you make a certain type of trade and it works, make it again.
Rule #10: Do not hope; act.
Rule #11: Don’t take sample opinions on a trade. You’ve done your research — live or die by it. If your research is thorough, no one else will know more about your trade than you do.
Rule #12: It is possible to make money going long a horrific company. I’ve successfully played dead cat bounces on Enron, Nortel, and Lucent.
Rule #13: Never try to catch a falling knife
All the best,
Christian DeHaemer
India is still rocking along:
Hey, MSM finally catches up with the Outsider Club:
https://finance.yahoo.com/news/jobs-report-stokes-fears-fed-may-have-waited-too-long-145226930.html
Brit killed it again:
https://www.outsiderclub.com/an-angry-stock-market/
