At long as a stock is acting right, and the market is right, do not be in a hurry to take profits. One should never permit speculative ventures to run into investments.
Interpretation
Patience is key in investing; donβt rush to take profits unless conditions change.
This quote emphasizes the importance of patience in trading and investing. Jesse Livermore advises that as long as a stock behaves well and the market conditions are favorable, investors should resist the urge to quickly secure profits. It warns against allowing speculative positions to turn into long-term investments without careful analysis, underscoring the need for vigilance in managing one's investments.
In practice
During a financial seminar to stress the importance of holding onto good stocks.
The average man doesn't wish to be told that it is a bull or a bear market. What he desires is to be told specifically which particular stock to buy or sell. He wants to get something for nothing. He does not wish to work. He doesn't even wish to have to think.
After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: It never was my thinking that made the big money for me. It always was my sitting. Got that? My sitting tight!
Don't take action with a trade until the market, itself, confirms your opinion. Being a little late in a trade is insurance that your opinion is correct. In other words, don't be an impatient trader.
He really meant to tell them that the big money was not in the individual fluctuations but in the main movements that is, not in reading the tape but in sizing up the entire market and its trend.
Men who can both be right and sit tight are uncommon. I found it one of the hardest things to learn. But it is only after a stock operator has firmly grasped this that he can make big money.
It is what people actually did in the stock market that counted - not what they said they were going to do.
Never, ever invest money that you will need prior to three to five years - minimum.
It isn't as important to buy as cheap as possible as it is to buy at the right time.
Observing that the market was FREQUENTLY efficient, EMT Adherents went on to conclude incorrectly that it was ALWAYS efficient. The difference between these propositions is night and day.
When interest rates are low we have conditions for asset bubbles to develop, and they are developing at the moment. The ultimate asset bubble is gold.
When I trade, I don't have an agency problem; I have my neck on the line. When a bank or banker trades, it's not his neck on the line.
Regardless of what happens in the markets, stick to your investment program. Changing your strategy at the wrong time can be the single most devastating mistake you can make as an investor.
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