Photo: asterix611 on flickr
In his weekly note, Raymond James’ Jeff Saut warns that January could end up looking like January of 2010, when stocks started off very strong out of the gate, and then ended down for the month.Saut also passes along 8 New Year’s resolutions from trader and author John Magee. They’re pretty good.
• “I will not alienate my friends and antagonize my family by reminding the world on every possible occasion how right I was about the upturn – or downturn – in steels, motors, airlines, or whatever.
• When I buy a stock I will not mobilize all the good news to make it look pretty. I will try to consider both the favourable and unfavorable angles as impartially as I know how.
• I will not close out a stock position that is doing well by me for no other reason than that I have a profit. I will not cut short my gains in a good situation.
• I will not hang on to a stock that is persistently going against me. I will limit my loss and close out any position that seems to have gone really bad before I am in danger of serious trouble.
• I will not be swayed or panicked by news flashes, rumours, tips, or well-meant advice. • I will not put all my eggs in one basket nor will I be swept off my feet to plunge into some unknown or low-priced
stock on a purely emotional basis.
• I will not attempt to tell the market what a stock ought to be worth. I will try to understand what the market has to tell me about what people are willing to pay for it.
• I will never forget that I am not in the market primarily to prove – to my broker, my friends, my wife, etc. – that I am smarter than everybody else, but to protect and, if possible, to augment my capital.”