Walton est l'un des Stock Market Wizards interviewés par Schwager dans son troisième tome. Après avoir travaillé comme broker et essuyé de nombreux échecs, il a réussi à percer et obtenu des résultats impressionants.
I understood that stocks don't go up and stay up because of stories, tips or people's opinions; they go up for specific reasons. I was determined to find these reasons, shut out the world and then act on my own knowledge. I started to do that, and over time, my record became better and better.Quelques extraits de son interview :
- I look for companies that have been blessed by market. You can identify these companies by how they act.
- When I buy a stock, I might be in and out of it twice in the same day and 6 times in the same week, trying to get a feel about whether I'm doing the right thing.
- I get out either because the stocks look as though it's rolling over, and I am in danger of losing what I have made, or because the stock has made too much money in too short a period of time.
- I often end up missing the rest of the move. I sometimes buy it back at a higher price. To me, the successful stock is not one that I bought at 10 and hold to a 100, but one where I picked up 7 points here, 5 here, another 8 here and caught a major part of the move.
- I don't draw a line in the sand and say this is my strategy and I'm going to wait for the market to come to me. I try to figure out what strategies are working in the market. One year it can be momentum another year it might be value. I try to anticipate what the market is going to pay for.
- I would attribute my own success to having both conviction about my gut feelings and the ability to act on them quickly.
- The biggest misconception is the widespread belief that it is easy to make a living trading in the stock market. People feel they can give up their job and trade for a living; most of them are bound to be disappointed.
- I could teach someone the basic rules, but I couldn't teach another person how to replicate what I do, because so much of that is based on experience and gut feeling, which is different for each person.
- During a losing streak I trade smaller. By doing that, I know I'm not going to make a lot, but I also know I'm not going to lose a lot. I need to refresh myself. Then when the next big opportunity comes around, if I catch it right, it won't make any difference if I've missed some trades in the interim.
It's a combination of things. The fundamentals are only 25% of it. Another 25% is technical. I like stocks that show relative linearity in their trend. Another 25% is watching how a stock responds to different information: macro events, its own news flow. I also pay attention to how a stock reacts to going to round numbers: $20, $30 etc. I want to see a stock move higher on good news and not give much ground on negative news. The last 25% is my gut feeling for the direction of the market as a whole, which is based on my sense of how the market is respounding to macro news and other events.Ses règles de trading :
- Be patient -- wait for the opportunity.
- Trade on your own ideas and style.
- Never trade impulsively, especially on other people's advice.
- Don't risk too much on one event or company.
- Stay focused, especially when the markets are moving.
- Anticipate, don't react.
- Listen to the market, not outside opinions.
- Think trades through, including profit/loss exit points, before you put them on.
- If you are unsure about a position, just get out.
- Force yourself to trade against the consensus.
- Trade pattern recognition.
- Look past tomorrow; develop a siw-month and one-year outlook.
- Prices move before fundamentals.
- It is a warning flag if the market is not responding to data correctly.
- Be totally flexible; be able to admit when you are wrong.
- You will be wrong often; recognize winners and losers fast.
- Start each day from last night's close, not your original cost.
- Adding to losers is easy but usually wrong.
- Force yourself to buy on extreme weakness and sell on extreme strength.
- Get rid of all distractions.
- Remain confident -- the opportunities never stop.