MOST RECENT POSTS
Jesse Livermore’s Trading Rules Written in 1940
Jesse Livermore was one of the greatest traders who ever lived. You can read more about him here. Here are his trading rules written in 1940. You will find that many of them still apply today, proving that very little changes in the market over time.
1. Nothing new ever occurs in the business of speculating or investing in securities and commodities.
2. Money cannot consistently be made trading every day or every week during the year.
3. Don’t trust your own opinion and back your judgment until the action of the market itself confirms your opinion.
4. Markets are never wrong – opinions often are.
5. The real money made in speculating has been in commitments showing in profit right from the start.
6. As long as a stock is acting right, and the market is right, do not be in a hurry to take profits.
7. One should never permit speculative ventures to run into investments.
8. The money lost by speculation alone is small compared with the gigantic sums lost by so-called investors who have let their investments ride.
9. Never buy a stock because it has had a big decline from its previous high.
10. Never sell a stock because it seems high-priced.
11. I become a buyer as soon as a stock makes a new high on its movement after having had a normal reaction.
12. Never average losses.
13. The human side of every person is the greatest enemy of the average investor or speculator.
14. Wishful thinking must be banished.
15. Big movements take time to develop.
16. It is not good to be too curious about all the reasons behind price movements.
17. It is much easier to watch a few than many.
18. If you cannot make money out of the leading active issues, you are not going to make money out of the stock market as a whole.
19. The leaders of today may not be the leaders of two years from now.
20. Do not become completely bearish or bullish on the whole market because one stock in some particular group has plainly reversed its course from the general trend.
21. Few people ever make money on tips. Beware of inside information. If there was easy money lying around, no one would be forcing it into your pocket.
I can be reached at: jfahmy@zorcapital.com.
Disclaimer: This information is issued solely for informational and educational purposes and does not constitute an offer to sell or a solicitation of an offer to buy securities. None of the information contained on this blog constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. From time to time, the content creator or its affiliates may hold positions or other interests in securities mentioned on this blog. The stocks presented are not to be considered a recommendation to buy any stock. This material does not take into account your particular investment objectives. Investors should consult their own financial or investment adviser before trading or acting upon any information provided. Past performance is not indicative of future results.
Market Note to Members (3/26/25)
Here is the note I sent to my Educational Members earlier today. If you’re interested in more content like this, first time members can email support@joefahmy.com for a discount code. Thank you.
One of the biggest challenges I have with this Educational Product is that people constantly want ideas. The problem is the stock market is not always going to be healthy, and I don’t like forcing ideas just to keep people happy. I think many people forget that the stock market actually has corrections and that individual stocks can drop considerably (and sometimes these individual stocks never come back). Don’t forget the 80/50 rule that I discussed in the Seminar Videos. 80% of big winners correct 50% and 50% of big winners correct 80%.
The title of my 2025 Preview was “Keep Your Expectations Realistic.” I mentioned that after two big years, don’t be surprised to see a pullback this year, a range, corrective action, etc. In other words, chop and consolidation. When I ran a webinar in early January reminding members that we are likely to see a 10-15% correction this year, so many members were upset because they didn’t want to hear this. They kept telling me “Joe, we just want you to be bullish” as if I can control the market, lol. I get it. The past two years have been great, and no one wants to hear that the party is going to pause for a bit.
Now, the same thing is happening. In last Monday’s webinar, I mentioned that we still haven’t seen a valid follow through day on the Nasdaq Composite or the S&P 500 and people didn’t want to hear it. They said but (insert name) says this, but (insert name) says that. While I highly respect these people, I don’t care what they say. I care what the market is telling me. Right now, we are still below the 200-day on the Nasdaq Composite, and we have not seen any strong volume from the institutions. If you don’t care about volume so that it fits your narrative and justifies you being on margin, then do what works for you. I have MY rules, and I have to stick to MY discipline.
Again, my style is not for everyone nor am I imposing it on anyone. After doing this for almost 30 years, I’ve realized that you’re going to make the majority of your money during powertrends, which occur 2-3 times per year. The rest of the time, it’s going to suck (I don’t know how else to put it). That’s why managing a portfolio of individual stocks is difficult because it involves decision making, and most people want to be loaded up on stocks and watch them go up forever, as if they are ENTITILED to receiving gains from the stock market all the time. I hate to break it to you, but that’s not how the market works. Once you accept this concept, you will have much more clarity in your approach to the market.
I can’t say this enough: I am BEYOND grateful for all the members and for your confidence in me. I honestly can’t put into words how much I appreciate you and your continued trust in me. However, I’m not going to tell you what you want to hear just so you can justify your positioning in the market. I’m going to be real and honest, and if my interpretation of the market is wrong, I will do my best to correct it quickly. Again, please be patient and show some discipline until we see more consistency from the big institutions because THEY control the market. A better market could be right around the corner, but it will require more patience until we see the healthier conditions required for a SUSTAINED new uptrend. I will discuss this further in tonight’s MidWeek Video. Thank you and good luck.
I can be reached at: jfahmy@zorcapital.com.
Disclaimer: This information is issued solely for informational and educational purposes and does not constitute an offer to sell or a solicitation of an offer to buy securities. None of the information contained on this blog constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. From time to time, the content creator or its affiliates may hold positions or other interests in securities mentioned on this blog. The stocks presented are not to be considered a recommendation to buy any stock. This material does not take into account your particular investment objectives. Investors should consult their own financial or investment adviser before trading or acting upon any information provided. Past performance is not indicative of future results.
MORE POSTS
