30 Trading Rules From Tyler Bollhorn Of Stockscores

1. Buying a weak stock is like betting on a slow horse. It is retarded. 

2. Stocks are only cheap if they are going higher after you buy them. 

3. Never trust a person more than the market. People lie, the market does not. 

4. Controlling losers is a must; let your winners run out of control. 

5. Simplicity in trading demonstrates wisdom. Complexity is the sign of inexperience. 

6. Have loyalty to your family, your dog, your team. Have no loyalty to your stocks. 

7. Emotional traders want to give the disciplined their money. 

8. Trends have counter trends to shake the weak hands out of the market. 

9. The market is usually efficient and can not be beat. Exploit inefficiencies. 

10. To beat the market, you must have an edge. 

11. Being wrong is a necessary part of trading profitably. Admit when you are wrong. 

12. If you do what everyone is doing you will be average, so goes the definition. 

13. Information is only valuable if no one knows about it. 

14. Lower your risk till you sleep like a baby. 

15. There is always a reason why stocks go up or down, we usually only learn the reason when it is too late. 

16. Trades that make a lot of intellectual sense are likely to be losers. 

17. You do not have to be right more than you are wrong to make money in the market. 

18. Don’t worry about the trades that you miss, there will always be another. 

19. Fear is more powerful than greed and so down trends are sharper than up trends. 20. Analyze the people, not the stock. 

21. Trading is a dictators game; you can not trade by committee. 

22. The best traders are the ones who do not care about the money. 

23. Do not think you are smarter than the market, you are not. 

24. For most traders, profits are short term loans from the market. 

25. The stock market can not be predicted, we can only play the probabilities. 

26. The farther price is from a linear trend, the more likely it is to correct. 

27. Learn from your losses, you paid for them. 

28. The market is cruel, it gives the test first and the lesson afterward. 

29. Trading is simple but it is not easy. 

30. The easiest time to make money is when there is a trend. 

http://www.tischendorf.com

Quote for the day

"Ability is what you're capable of doing. Motivation determines what you do. Attitude determines how well you do it." - Lou Holtz

Quote for the day

"Some changes look negative on the surface but you will soon realize that space is being created in your life for something new to emerge." - Eckhart Tolle

Winner vs Loser

The Winner is always part of the answer.
The Loser is always part of the problem.
The Winner always has a program.
The Loser always has an excuse.
The Winner says, "Let me do it for you."
The Loser says, "That's not my job."
The Winner sees an answer for every problem.
The Loser sees a problem for every answer.
The Winner sees a green near every sand trap
The Loser sees two or three sand traps near every green.
The Winner says, "It may be difficult but it's possible."
The Loser says, "It might be possible but it's too difficult."
Be a Winner.

By Vince Lombardi

Quote for the day

"I believe that being successful means having a balance of success stories across the many areas of your life. You can't truly be considered successful in your business life if your home life is in shambles." - Zig Ziglar

10 Questions to Ask Before Purchasing a Stock - Investment Checklist!

Most Important questions to ask before purchasing a stock: Picking a winning stock that can give consistent returns for many years requires a lot of analysis and research. However, you can simplify the research process if you have an investment checklist.

Having a reliable checklist for picking stocks can reduce the chances of missing an important detail that you should have studied before investing in the stock. As Charlie Munger, Vice-Chairman of Berkshire Hathaway has famously quoted: 

“No wise pilot, no matter how great his talent and experience, fails to use a checklist.”  -  Charlie Munger

In this post, we are going to discuss ten key questions to ask before purchasing a stock by every stock investor. Let’s get started.

Quick Note: Although there are hundreds of points to check while picking a stock to invest, however, most of them can be categorized among the ten questions listed below. Anyways, by no means, I claim that this is the best checklist for picking stocks. My suggestion would be to study the investment checklist given below, improvise and make your own list of questions. Further, for simplicity, I’ve not included financial ratios.

Here are the ten key questions that every investor should ask before investing in a stock.

1. What does the company do?

What are the products/services that the company offers? Do you understand the company’s business model? How does the company actually make money? What are the top/best-selling products of the company?

2. Who runs the company?

Who are the promoters/owners of the company? It the company a family-owned or professionally managed one? Who is managing the company? What are the credentials/background of CEO, MD, Board of directors and the management team? What is the shareholding pattern of the company?

3. Is the company profitable?

How much profits did the company generated in the last few years? How are the company’s gross, operating and net profit and what is the profit margin at each level? Is the profit of the company growing over time or stagnant/declining?

4. Does the company have a sustainable competitive advantage?

Does the company have a moat like intangible assets, customer switching cost, network effect, cost advantages or any other sustainable competitive advantage that can keep the competitors away from eating their profits?

5. How was the past performance of the company?

How is the company’s financials in the past few years? What’s the trend in the company’s income statement and cash flow statement? How are the sales, EBITDA, Cash from operating activities, free cash flow and other financial metrics over the past few years?

6. How strong is the company’s balance sheet?

Are the assets of the company growing over time? How much is the liability of the company? Is the company’s shareholder equity increasing? How much cash does the company have on the asset side? How much is the company’s Intangible assets, Inventories, Receivables, Payables and more? Does the company invest in its Research & Development, especially in a few sectors like Technology, Pharmaceutical, etc?

7. Was the management involved in past fraud or scams?

Was the company’s promoters or management involved in any past scam? Does the company has any history of cheating the shareholders or any past penalty by SEBI?

8. Who are the key competitors?

Who are the direct and indirect competitors of the company? What is the market share of the company vs the competitors in the industry? What this company is doing differently compared to its competitors? Are there any global competitors or the possibility of global leaders entering the same market anytime soon?

9. How much debt the company has?

How much short-term and long-term debt the company has? Does the company generate enough profits or Free cash flow to cover the debt in the upcoming years? Have the promoters pledged any of their shares?

10. How is the stock valued?

What is the true intrinsic value of the company? Is the company currently over-valued, under-valued or decently valued? Is the company relatively undervalued compared to the competitors and industry? What is the calculated intrinsic value by different valuation method? How much is the margin of safety? Will you be overpaying if you buy the stock right now?

Closing Thoughts:

Although getting a recommendation or investing where friend/colleague suggested may land you into a few profitable deals. But if you want to make consistent returns from the market (and not just being lucky), you need to build your own trustable investing strategy.

It’s true that picking a winning stock required a tremendous amount of research. However, having an investment checklist of questions to ask before investing in stock significantly reduce the chances of investing in fundamentally weak stocks. Moreover, you can easily eliminate over 90% of the companies that don’t meet your checklist.

I hope the questions discussed in this post is helpful to you. If I missed any additional important to ask before purchasing stock in this investment checklist, feel free to mention below in the comment box.

That’s all. Have a great day and Happy Investing!

Source: www.tradebrains.in/

Quote for the day

"Winners have simply formed the habit of doing things losers don't like to do." - Albert L. Gray