[Trading] Pring Martin J - Investment Psychology Explained Classic Strategies To Beat The Markets - Part 1.pdf

Investment
Psychology
Explained
Classic Strategies to
Beat the Markets
Martin J. Pring
John Wiley & Sons, Inc.
e Singapor • o Toront • e Brisban • r Chicheste • k Yor w Ne
Contents
Introduction
PART I KNOWING YOURSELF 7
u Gra y Hol o N s I e Ther . 1 9
2. How to Be Objective 24
3. Independent Thinking 47
s Los a e Befor s Goe e Prid . 4 67
5. Patience Is a Profitable Virtuc 79
6. Staying the Course 89
PART II THE WALL STREET HERD 107
n Opinio y Contrar t a k Loo w Ne A 7. 109
8. When to Go Contrary 134
9. How to Profit from Newsbreaks 154
10. Dealing with Brokers and Money
Managers the Smart Way 167
D AHEA P STE E ON G STAYIN I II PART 181
3 18 ? Investor r o r Trade t Grea a s Make t Wha . 11
12. een Trading Rules for Greater Profits 205
13. Making a Plan and Sticking to It 224
14. Classic Trading Rules 244
Bibliography 267
Index 271
Introduction
x"or most of us, the task of beat-
ing the market is not difficult, it is the job of beating ourselves
that proves to be overwhelming. In this sense, "beating our-
k thin o t g attemptin d an s emotion r ou g masterin s mean " selves
independently, as well as not being swayed by those around us.
o t t ou n tur y invariabl s instinct l natura r ou n o d base s Decision
be the wrong course of action. All of us fortable buying
stocks when prices are high and rising and selling when they are
s u s encourage t tha e attitud n a p develo o t d nee e w t bu , declining
to do the opposite.
ess based on an emotional response to market condi-
tions is the result of chance, and chance does not help us attain
consistent results. Objectivity is not easy to achieve because all
- opin f o e prid , greed , fear f o s vagarie e th o t t subjec e ar s human
ion, and all the other excitable states that prevent rational judg-
t marke e th o t s approache s variou n o s book d rea n ca e W . ment
until our eyes are red and we can attend seminars given by ex-