William J. O'Neil

William J. O'Neil was born March 25, 1933 in Oklahoma City, and grew up in Texas. O'Neil studied business at Southern Methodist University, where he received a Bachelor's degree. He then went on to serve in the United States Air Force.

In 1958, O'Neil began his career as a stockbroker, where he developed a trading strategy, which made early use of computers. O'Neil began studying historical stock market winners. He found out there were certain key characteristics all these leading stocks had in common, before their big upward price movements.

O'Neil implemented these key characteristics into the highly successful trading strategy known as CANSLIM. This winning method combines technical and fundamental analysis, along with proper trading principles, such as keeping your losses small, and letting your profits run.

O'Neil is founder of Investors Business Daily. In my opinion, this publication is by far the best, when it comes to the stock market. When properly implemented, the CANSLIM method is highly successful. I can personally vouch for this, as I have been successfully using this system for many years.

The American Association of Individual Investors named CANSLIM, the top performing investment strategy from 1998 to 2009. This non-profit organization tracked more than 50 different investing methods, over a 12 year time period. CANSLIM showed a total gain of 2,763% over the 12 years.

O'Neil's accomplishments and awards are much too numerous to list. He has made an incredible fortune, using his system to trade in the stock market. Best of all, nearly anyone, who is willing to put in the time and effort, can also use this system to make a substantial amount of money trading in the stock market. I highly recommend reading, "How to Make Money in Stocks", by William J. O'Neil. It could be your ticket to making a fortune in the stock market. O'Neil is a true trading legend.
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Jesse Livermore

The greatest stock market operator
 
Jesse Livermore is widely considered the greatest stock market operator of all time. Livermore was actively involved in the stock market from 1892 to 1940. There were many ups and downs, but also incredible wealth attained by this great master. In this article, I will cover some of the key reasons why Jesse  Livermore is the Babe Ruth of the stock market. It is important to note, all of Livermore's principles, strategies, and methods are just as valid today as ever.

Early lesson of patience

Livermore, like all traders, made a lot of mistakes early in his trading career. After a while, he certainly realized trading wasn't easy at all. This caused Livermore to analyze the mistakes he made that caused his losses. A key lesson he learned was patience. Often he would become impatient, and felt he had to trade no matter what. This lead to impulse trading, which rarely leads to successful trading. He learned its crucial to have as many pertinent factors as possible in your favor, before taking a position in the market. You want the odds strongly in your favor on each and every trade you make. Learning this early lesson was a real springboard to success for Jesse Livermore.

The skills and traits of a winning trader

There are certain skills and traits required if a trader is to be successful in the long run. You must have reasonable intelligence, and can not be mentally lazy. Livermore considered trading a full-time business, and would always be looking to improve himself. The following are areas he believed were essential for success.

1. Understand and controlling the psychological part of trading. You can not allow greed, fear, hope, or other emotions influence your decision making. You must trade objectively.

2. A solid knowledge of economics, and business conditions. You need to understand crucial elements, such as the interest rate cycle, and how it can have an impact on the various trading markets.

3. Observation. It is important to stay focused on factual data only. Do not get swayed by questionable information.

4. Memory and experience. Learn from your mistakes, so you don't repeat them. This is a key in the overall learning process.

5. Mathematics. It is important to understand how numbers work, when applied to the stock market, and other trading venues.
A summary of winning strategies

Jesse Livermore was a true market master, and absolute genius when it came to trading the stock market. A main reason he attained vast fortunes is because he thought, and acted differently than most traders. Here is a summary of his successful strategies.

1. He always knew the general trend or direction of the stock market. You must go with the flow of the market. Don't fight against it.

2. Only buy stocks hitting new highs as they move through key resistance areas, on much heavier than normal volume.

3. Keep all losses small. A good policy is to always sell a stock if it drops 10% below the purchase price.

4. Let your profits ride. Be patient with your winning stocks. The really big money is made in large price movements that go your direction.

5. Focus on leading stocks in the strongest industry groups. You will find most of the biggest winners there. Buy the best at the best possible time.

6. Never listen to, or follow, the tips and information from others, unless you are sure they know what they are doing. Do your own research and analysis. Be objective, and stick with the facts.

7. Avoid low-priced stocks. They are cheap for a good reason. Most cheap stocks will continue to go down in price.

The most successful stock trader ever

Jesse Livermore made hundreds of millions trading the stock market. He once made 3 million dollars in a single day, when he correctly called the crash of 1907. He made a hundred million dollars during the crash of 1929. Livermore was a master of price and volume analysis. This was a key to his overall success. If you want to become successful in the stock market, study and learn from Jesse Livermore. Read his books. He is the perfect blueprint to follow. You could make a fortune.
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Bernard Baruch

Baruch was born in 1870 in South Carolina. He was a great student of finance, reading everything he could find about the subject, always trying to learn more. Baruch found out the education process takes time, especially when it comes to trading the stock market.

Early on, Baruch made many of the same mistakes that most traders make. Ultimately, after much dedication to learning proper trading principles, he amassed a huge fortune in the markets. Because of his intellectual reputation, he even held appointive positions in four presidential administrations, and served as an advisor to six different presidents.

In his book titled "My Own Story", Baruch gives us some rules or guidelines on how to invest or speculate wisely.

1. Don't speculate unless you can make it a full-time job.

2. Beware of barbers, beauticians, waiters-of anyone-bringing gifts of "inside" information or "tips".

3. Before you buy a security, find out everything you can about the company, its management and competitors, its earnings and possibilities for growth.

4. Don't try to buy at the bottom and sell at the top. This can't be done-except by liars.

5. Learn how to take your losses quickly and cleanly. Don't expect to be right all the time. If you have made a mistake, cut your losses as quickly as possible.

6. Don't buy too many different securities. Better to have only a few investments which can be watched.

7. Make a periodic reappraisal of all your investments to see whether changing developments have altered their prospects.

8. Study your tax position to know when you can sell to greatest advantage.

9. Always keep a good part of your capital in a cash reserve. Never invest all your funds.

10. Don't try to be a jack of all investments. Stick to the field you know best. This is what trading legends do.
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Gerald Loeb

Gerald M. Loeb was born in 1899 and started investing in 1921. Loeb would read everything he could on trading, investing and economics. In 1923, Loeb learned a valuable lesson when he took a substantial loss of his overall trading capital. He learned, from that point on, to always cut losses short, meaning to only take small losses when the market goes against you.

Loeb was changed forever after the Wall Street Crash of 1929. He avoided personal loss during the crash, but it greatly affected his trading style. Loeb now believed that holding stocks for the long term was not a sound trading principle. The 1929 crash proved to him that holding onto stocks can have a terrible effect on your portfolio, when you ignore sell signals that the market is in trouble.