Six MUST FOLLOW Rules to Investing By Charles Delvalle 
Have you ever been on a losing streak and felt like there was no way for you to make money in the markets? I think we all feel that way from time to time. It’s natural. After all, our emotions are never static. The worst part is that when we’re in that mindset, we can actually create a self-fulfilling cycle. Maybe we’re trying too hard. Maybe we get sucked into a variety of different indicators that we never followed before. Or perhaps we get into one trade hoping that it’ll make up for all the losers we just had. Nine times out of ten, it never works out though. The end result is that you lose more and more money. But it doesn’t have to be that way. So here are six simple rules for you to follow that will help you manage your emotions better and become a better investor. Rule #1: Hope to make more money, fear to lose more. In the book Reminiscences of a Stock Operator, this was one of the most important lessons that trader Jesse Livermore learned in his time as a trader. When he got into a position and it started losing money, he realized that he had to get out of it quickly (cut your losses). So what he’d do was to fear that he’d lose more money and get out of the trade. On the other hand, if the trade was going his way, he would hope to make even more (let your winners ride). Rule #2: Stick to Your System, NO MATTER WHAT. This is a tricky rule to stick to, even for experienced traders. But the truth is this: If you have a system that you know for a fact works, then don’t stray from it. You will only end up losing money. Why do investors stray? Sometimes it’s the feeling of invincibility they get after they’ve won a few trades in a row. Other times it’s simply because they are desperate to hit a winning investment. Whatever the reason, when you stray from your system, you stray from what you know works. Ignoring what you know is never a good way to make money. Rule #3: Don’t become attached to your money. Sounds easy, right? You’d be shocked how hard it is to actually implement. Too many people put money in the stock market that shouldn’t be there. If this is your retirement, or tax money, or money you owe to somebody, DON’T USE IT IN THE STOCK MARKET! Only use money that you can afford to lose. INTERNAL ENDORSEMENT 152% Overall Return Last Year... 13 Winners Between 46% and 173% in the Last 90 Days Forget what you've heard about how tough it is out there - how the market is falling, and the sky is too! In the last few months, subscribers to Rick Pendergraft's K.IS.S. Investing had an opportunity for gains of 159% on Continental Airlines... 173% on the ETF that tracks the Dow... 129% on the ETF that tracks the Nasdaq... 89% on Verisign and another 71% on XM Satellite Radio. And here's the REALLY good part... for a limited time you can gain access to Rick's research FREE for life... keep reading for all the details.
| Rule #4: Don’t play catch up. If you’ve hit some losses in the stock market, the last thing you should do is ‘double up’ and hope to hit a winning trade. What if you don’t win? You will lose twice as much and be in even more pain. Listen, losses are a part of the game. Every investor in the world loses money from time to time, but if you’re system works (rule #2) then stick to it and you should end up back in the green in no time. Rule #5: Don’t overanalyze things. I can’t tell you how many times I open up the Wall Street Journal and see an article that goes completely opposite to what I believe to be true about a particular sector or investment. Does that mean I listen to them? In all honesty, I look at the argument and see if it has merit. If it doesn’t, that’s it. I stick to what I believe to be true unless something drastically changes. In my trading arsenal, I have a few indicators I look at and then have certain beliefs about the market and sector based on a few people I trust and what I know of the market. Everything else is just static. It’s only there to agitate you. Rule # 6: Listen to yourself. One thing I’ve learned is that as you trade, you find out new things about yourself. You find out what your true fears are (fear of success, maybe?), you find out your weaknesses (maybe not following your system to a T), and you find your strengths (maybe you make money best in certain sectors). As an investor, you need to pay attention to all of these things. That way if a certain emotion is cropping up and threatening to lead you in the wrong direction, you could quickly stop it and move on. If you can stick to these six rules, you’ll be able to have a much better grasp of your emotions while you trade. To your success, Charles P.S. To let me know what you thought of today's article, send an e-mail to: feedback@investorsdailyedge.com. It's Debate Time: Tony's Point By Charles Delvalle A few weeks back I talked about the big three automakers and how they never learned a thing from the 70’s. One reader took me to task and said… "I find your take on Detroit to be fascinating. You are obviously well educated and liberal to a fault. You have forgotten your marketing and capitalism fundamentals... It is not up to the Detroit Big 3 to decide what the public buys; it is the buying public's job to decide that. When you drive almost anywhere you see Trailblazers, Durangos, Mercedes SUV's, Porsche SUV's, Hyundai SUV's, Toyota SUV's, Pick-up trucks of all types and all makes AND some of the biggest gas guzzling pick-ups come from Toyota and Nissan." I see your point, but there are some holes in the argument. You see, the very first thing that messed up the domestic automakers was quality. In fact, quality perceptions still haunt the big three today. Just ask anyone if they want to buy a Ford and they might laugh at you and say… you mean Found On Road Dead? (Of course, newer Fords are MUCH MUCH better) The other part of your argument talks about what people wanted to buy, which was big cars and trucks. Yeah, I agree they wanted to buy them, but let’s not forget about the government tax breaks for buying SUVs. Also, not everyone needs an SUV or truck! If only the people that NEEDED them bought them, then sales never would’ve taken off the way they did. These were luxury items, you see. The fact is the big three depended too much on SUVs and trucks. And for eight years, they failed to respond adequately to higher gas prices. Eight years is a long time. If Intel waited eight years to come up with a new processor design, they’d be laughed out of the industry. So why did it take Ford, GM, and Chrysler eight years to finally start responding to gas prices? You see, their business model depended on the fat margins they got by selling trucks and SUVs. They didn’t want to go through the effort of changing it. So in the end, when push came to shove and gas prices rocketed higher, they didn’t have a quick plan to fight back. Now, we have to wait two to four years for their newer, more fuel efficient cars to come out. In the meantime, Chrysler will probably go bankrupt (unless their new owners want to spend billions in keeping them alive), while GM and Ford keep cutting brands and running out of options. The mistake was theirs. If they hadn’t made these mistakes, they’d be making more money right now. INTERNAL ENDORSEMENT Global Food Crisis Ignites Secret Commodity Market! As global food supplies dwindle, a tiny $3 stock has a solution that could launch it to $45 per share. Get in by June 30, and you could make 15 times your money. Read on for all the details…
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