Rules of the Investment Game
Rule #1
Find the parade and get out in front.
Rule #4
When analyzing growing companies, ignore earnings and focus on investment.
Rule #7
Avoid the crowd at all costs.
Rule #10
Adversity removes the fragile and spares the robust.
Rule #13
Bubbles are the most destructive force known to mankind.
Rule #16
Buy on the cannons, sell on the trumpets.
Rule #19
Water the flowers, pull the weeds.
Rule #2
Pay attention to addictive consumer brands.
Rule #5
Buy right and sit tight.
Rule #8
It’s a market of stocks, not a stock market.
Rule #11
Cui bono? In politics, consider who benefits.
Rule #14
Sell the shortage, buy the glut.
Rule #17
If government is leading the parade, quietly slip out the back.
Rule #20
Take ownership of the data. Don’t blindly trust statisticians.
Rule #3
Growth can have a long runway when brands expand nationally and internationally.
Rule #6
Align yourself with people who have skin in the game.
Rule #9
In a panic all correlations go to 1. Panics always create buying opportunities.
Rule #12
The retail investor is always late to the party.
Rule #15
Beware simple narratives.
Rule #18
Due to high leverage, fickle capital and exposure to bubbles, most banks are uninvestable.
Rule #21
Avoid binary thinking. Find similarities where others see only differences.
