The 5 Golden Rules of Investing Success

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In this exclusive article Clem Chambers, Forbes columnist and author of the Amazon No.1 investing bestseller 101 Ways to Pick Stock Market Winners,  discusses the five golden rules to help you start trading successfully.

The 5 Golden Rules of Investing Success, by Clem Chambers.

Stocks and shares seem to be the reserve of the rich; a risky business where the novice loses their shirt. But there must be away to get started without getting burned?There are many more people watching share prices than investing in stocks. Most realise that investing is the way out of living from pay check to pay check, but do not know where to start.

Here are five rules to stock market investing success to get you started.

Rule  1Build a stock portfolio of 30 shares.

Take no notice of the people that say put all your eggs in one basket. A portfolio gives you a certainty that bad luck won’t hurt you and that your choices on average will deliver the return your share picking deserves. This portfolio return over the years will outperform anything a bank will offer you on deposit and will compound.

A diversified portfolio will mean you will miss out on good luck, but investing isn’t about good luck. Bad luck and good luck cancel out over time but if you have too much of your money in too few shares then bad luck can knock you out of the game.

Rule 2Until you own at least 30 different shares never buy more than £1000’s worth of any share.

Risking too much on any stock investment is a recipe for disaster, even for the sophisticated stock market investor. Keeping your individual share investments small keeps your capital pot safe and lowers the stress that can make investing unpleasant. Once you have 30 stocks you can grow the scale of each investment, but until that day stay small.

Rule 3 – Get online and get the stock picking tools of modern investing.

A free ADVFN account provides investors with free stock market tools that a few years ago would not even be available to the professional fund manager;

    • Real time share prices.
    • Fundamental information.
    • Portfolio tracking.
    • News.
    • Opinion.
    • Many more free services!

These free services let you make highly informed financial decisions on what share to buy and when to sell them.Researching your stock market investments might seem like work. That is because stock market investing is work.

Sadly investing is not a short cut to wealth, you need to treat it like any other way of making money -with focus and determination. Hopefully you will find it a lot of fun and more like a pastime than a chore.

Rule 4  – Always pick stocks using charts.

There will always be new ways to make money using charts and over time they will stop working. This is the way it is with markets.

To be successful you need to be constantly on the lookout for new methods; old ones are always eaten away by the efficient market. To make gold you must slowly destroy your philosopher’s stone and then make another.

Rule 5 – Invest in shares for the long-term.

Buy shares you think you will hold for three or more years. Do not make your broker rich and yourself poor by trying to trade. When the world’s most successful investor, Warren Buffett, claims sloth as his most profitable investing trait you should take note. Slow and steady wins the stock market investing race. Value investing is a great skill to learn.

Put your investing money in a SIPP or ISA and let the profits roll up tax free. While interest from the bank is taxed, using these tools can protect your stock market profits and dividends from tax; one more reason to let the long-term take hold.

Just remember, by the time you can afford a Ferrari from stock investing you will be too old to want one. You think that’s bad? Perhaps you should wonder if you have any other way to get Ferrari rich at all, before you worry how long it will take.

If you can see stock market investing as a part time job from now until retirement you will do very well indeed from it; it is the short-term forex and share traders that get burnt.

If you register with ADVFN, you will receive a free, easy to follow guide on ‘How to Invest’.

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

This area of the site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.


  1. Avo says:

    Right on the money! I think you meant 30 stocks (companies) and not just shares. Right?

  2. Geo says:

    Pick stocks with charts? I use the Ouija Board method instead with similar luck

  3. alistair says:

    good article to read

  4. marketfog says:

    Pick 30 stocks. Why not invest in a good mutual fund instead?

  5. Jeff says:

    Dear me, Avo, you can’t be serious.

    If you are, I suggest you buy 30 shares of Blackberry.
    Really well-priced at the moment.

    There you go, set for all eternity.

    The article, properly understood, is good, although
    some would say shares in 20 companies are the most you
    should hold, not 30.

    It IS a part-time job. If you can’t see it as such,
    put it in the hands of an adviser, but be ready to
    lose a big chunk of your take in fees.

    Do NOT think the stock market will raise you from rags
    to riches. But with serious effort, you will do far better
    in it than you could ever do on bank interest. (Dividends
    and Capital gains are taxed much more lightly, among other


  6. Kim says:

    Clear, comprehensive.

  7. Fasted says:

    Looking to invest on the stock market for the first time.
    New adventure and looking for some god advice.

  8. Len says:

    Interesting article, but don’t agree with must hold for three years, investing and managing a portfolio is ongoing, buy a good stock that doubles in 6 months, sell it if you so wish, why hang on for three years, it may tumble. I invested in 10 OEICS (Mutual fund in the USA) oct 2012 I have made 10% in one year, tax free wrapped in an ISA, not Ferrari money, but steady, better than the bank where I would be luck to get 1.5%

  9. A Crawford says:

    Some of these comments make me wonder if a #6 rule shouldn’t also be applied, for never investing if you are simply stupid.

    30 shares … c’mon; Is that what you really thought was meant? If so, save your money under a mattress, providing you even have enough intelligence to find it again … sorry, but LOL

  10. GBChapman says:

    Rule 6
    Don’t spend $ on luxury yachts as they are expensive to maintain and depreciate their value rapidly. Much like a trophy wife. ;-)

  11. Daniel Fagen says:

    I lost all respect for your opinion as soon as you said “always use charts”…

  12. John says:

    For value investors, the easy going would be to pick up something like n-y-m-t with about 17% or b-g-c-p with 8% divident. It’s a no brainer for everyone who wants to save time while beating up the bank interest rate.

  13. Sandy says:

    “Sloth as his most profitable investing trait” That’s exactly what I want -being too old to do any other than open my eyes and count down when I’m going to die. And once I’ve peeled I’ll will be financially raped by all family members and pass all my riches on to everyone else! Do you get paid to write this crap?

    My advice to whoever is reading this – if you want to get rich work hard and believe you’re good enough to do. I went from working as a teaching earning next to nothing to earning £50,000.00 a month. Don’t believe me you don’t have to I’ve made it.

  14. Jason says:

    Invest in yourself as young as possible, teach your kids to do the same thing…you don’t have to live like scrooge to become as rich as scrooge, you can have fun and still avoid the pitfalls of day traders.

    Watch around you to get an idea of what’s going to rise and fall…simple connections like a cold summer, warm winter, over production of one thing against under production of another…its not charts, for the most part common sense.

    As Warren Buffet says, “When people get nervous, get greedy and when they get greedy, get nervous!”…when everyone is buying something then time to sell it and vice versa

  15. Jc says:

    1 rule. Just buy a good low fee S&P 500 ETF with the money the 5 rules folks are planning to charge you for their program. you’re welcome.

  16. SilverTop60 says:

    My Barclays shares in December 2000 were worth £5.18 each, and HSBC shares £9.85. Now they are worth £2.56 and £6.87 respectively. That’s hardly a good long term investment over 13 years in shares and I thought banking would be safe. I could no way have predicted when to get out any more than anyone foresaw the current financial crisis that hit my shares worst in 2009. The only way to play the stock market is the oposite of what I have read here. Keep your cash in your savings account and wait for a “Black Friday” when the market has had a severe dip. Jump in and buy hard and jump out a week later when they have recovered. I will probably be dead before my shares get back to £5.18 and £9.85. The only winners with all these schemes are Financial Planning Managers who charge you to lose your money.

  17. RHWCPA says:

    One other rule of investing I give my clients:
    If it floats, flies or fornicates, rent it, don’t buy it.

  18. Mo says:

    Sounds like prudent advice! I’ve never invested and your opening line characterised me; “There are many more people watching share prices than investing in stocks”! However, I was contemplating putting some money in to 3d printing… now I’m left with the impression I shouldn’t…

  19. Shaka says:

    Violet rule 2 Violet rule 2 Violet rule 2 Violet rule 2

  20. Jim says:

    You can make money in the market, of course. But my experience has been not to listen to brokers. They all churn your investments to make a commission. It is how they make a living. If you buy and sell they make money, they couldn’t really care less if you do. Most people don’t have the time to research a company, so the advice to buy on a black Friday, or when a firm has had some bad tidings, is not a bad idea. I bought into RR some years ago on a day when their shares fell very badly, and I sold a few weeks later and made a lot of money, also have done the same with a couple of I T firms, but the firms must have enough capital and employees to be viable in the long term.

  21. Forrest says:

    Thanx for all your comments, they opened my eyes on whats really the right things to do as an invester. happy Investing! Try an Option every once an a while with extra cash !

  22. ripv says:

    Englishbis not this authorsvfirst languag

  23. MR Free says:

    Disagree, first of all I think the author does not mean “30 shares” instead it should be “30 stocks”.

    The first advice I would give is consult several financial advisors and see what they say for your specific situation. Insurance is usually part of a long term investment strategy for various reasons including tax mitigation, covering assets, and estate planning.

    This article advocates an oversimplified strategy. Professional advice is highly recommended.

  24. Harvey lehman says:

    I just recommended this article to a number of people in an investment club. While I do not agree with everything written, it is a good starting point for investing. Trust but verify, the man said. Sloth but be careful of the Polaroids of yesteryear. There comes a time when admitting you were wrong is best, get out or cover shorts, and go on to better things.
    As one example, I had 100. Call options on Tesla about six months ago bought at .17 and when stock skyrocketed to 192 so did the options. 1700 turned into 3 million. Of course, I had sold almost all at that point but was happy with the profit I made. I then bought puts. Since the money was in an IRA I could not short it. Rules #1-10. NEVER FALL IN LOVE WITH SOMETHING THAT CANNOT LOVE YOU BACK.

  25. G P says:

    I read this article and I liked it very much, it gives good sensible advice to the reader, at the end of the day it is up to the reader to make the decision to invest or not. I always say “only invest what you can afford to loose” that way if you do then why worry. The article is also correct to say that you should spread the risk, that’s also why they have each way odds in horse racing. start with a good investment manager and keep a careful I on his performance.Best of luck with your investments

  26. Michael Levy says:

    Golden Rule: When it comes to investing, there are No Golden Rules, for all rules are broken from time to time by changing perspectives. If you really need to succeed in life…Invest With A Genius…The one you were gifted at birth.

  27. W.L. Williams says:

    Re how Xmas is celebrated around the world, I believe your first supposition is wrong, viz., one third of the world is Christian. I would be surprised if the number were 20%. Where did you get your numbers?

  28. George says:

    I don’t get these brokers that want to manage your investments for you. They must all think we’re idiots. If they are in the investment game for over three years and still working, they are the losers….and so would be.

  29. Alan says:

    We’ll glad I did not buy ADVFN shares for the long term I would be skint

  30. LongTimeInvestor says:

    Buy good companies, reinvest the dividends, understand what the company does, avoid trading, avoid margin, and options, Diversify – Invest in what people have to buy, and in my opinion -If you do not like the companies product, or customer service – avoid it

  31. This Article Sucks says:

    The first 4 rules are terrible. Only rule #5 has merit.

  32. Recipe for Disaster says:

    This is a recipe for disaster. I strongly urge anyone considering investing In the stock market for the first time to avoid this article like the plague

  33. Saint Joseph says:

    Hi Folks,

    As an investor for 4 decades, I have but ONE RULE.

    Invest for the long term (next generation) in big cap, blue chip US stocks. I do have a small position (5%+/-)in Canadian stocks.

    I took early retirement in year 2000, and life is good!

    The rest is history.


  34. DomR says:

    IM a beginner ,started in August when I took over my Dads portfolio. The reason why he gave it over is ,he didn’t have the head anymore or the patience to be on to of it everyday. And that the biggest lesson I learned from him .You have to watch it ,you have to do the research and homework .Other lessons he taught me was buying solid companies with dividends .Companies that you know aren’t going anywhere EX. we have Harley,Verizon,Phizer,Costco 20 stocks only 5 of them are speculative . All doing well Besides dad JIm CRamer s books are great for the newbe .He teaches you how to research how to figure out earnings ect.. Also a big help is trading and using the tools on Fidelity. don’t be greedy ,take the profit play with there money I don’t buy anything if I cant afford a minimum of 100shares ,anything less your paying commissions two and 3 times for the same stock .30 shares to get to 100 you would pay 3 commissions right? ITs not a hard game but it is something you need to follow religiously Good Luck

  35. Bob says:

    Probably the best advice I have heard. Well, if you like spinning your tires in mud and going no where!!!!

    Building a stocklist of 30 companies is great. Keep it fictitious and watch it regularly with the information that led you to believe that it was worth tracking. As for riding through the good and bad calmly, you will learn this if you stick to a watch list for a long period of time before actually investing. Invest your time first, your money second. Don’t invest in a business or industry if you can’t tolerate bad news.

    £1000 worth of stock? Do you know how much your shares will need to increase just to pay off the commission/trade fees? You gotta be kidding me. I’m not saying put all your eggs in one basket but I definitely don’t like giving up most of my earnings to exchange fees.

    Charts make it a good way to follow and understand trends or explain market sentiment. Don’t rely on a charts solely to make your decisions. Look into the company, the industry, the news that affects it, charts are merely a component and a tool in this decision.

    Invest for long term? If I see bad things on the horizon and your net positive CASH out don’t ride bad currents. USE your head. You can always buy back in. Dividends are great but on a £1000’s? that’s a fart in the wind. Nothing.

  36. Been there says:

    Unbelievably bad advise. Everyone of these 5 rules is written to feed the mugs game the financial sector is resulting in lining your brokers pocket. I’ve been in the game for 20 years and would have been better off putting my money in a mattress. Pulled out of the game 3 years ago and am way ahead in cash waiting for a Black Friday to buy using a low fee account. One guys opinion, no expert but these rules are exactly what the financial industries wants to perpetuate. Many positions = high commissions held long term = high dollar value for brokers books until the inevitable downward slide comes covered by the next gullible investor. I may not have all the answers but have seen the pitfalls. Would love to hear the answers from success stories.

  37. Steven says:

    I believe most of this is good advise, there’s always those that know better , and give there two cents worth. If you really want to give good advise I suggest you dig really deep and offer things that will really make people think. I think someone should study all the charts and help explain exactly how to use them, it’s much deeper than just looking at it every day. I’m not sure if a specific software program has been written analyzing charts,but if not someone needs to do so, it could involve every form of japanese candle sticks. If done properly, all you would have to do is put your stock symbol in and it would tell you if it is a good investment of not, along with the MACD. I believe as for as the 30 stocks and not buying less than 100 shares, sounds good but it depends on each persons portfolio and commission charges..I pay $7 coming and going so if I can’t pay that from my gains, I need not to trade.

  38. Roger K says:

    30 stocks would be tough to follow. Better go with etf’s. It has the liquidity of stocks and low expense charge being an index. Check out MGC, VB, VO or VTI. Dabble in some real estate like VNQ and emerging markets. For those conservatives, you can’t go wrong with VWINX.

  39. Roger K says:

    In addition, you should have a stop loss for each stock you buy. This will avoid catastrophic losses. You can ride your winners by adjusting your stop losses on the way up.

  40. son of a preacher man says:

    ALL very sound advice for a cautious investor. all the critical replies here are from those who help the rest of us make a living. rule 7 ignore advice from anyone who admits they have been investing for 20 years and have less money than if they had put it “under the mattress” doh!

  41. Freddy says:

    I’ve learned a lot just reading the testimonials. Amazing!

  42. David Sopala says:

    It depends on if you watch the stocks like a hawk or not. I have 30 stocks I watch for fluctuations and wait for them to go down to by in then set my sell point. I bought into AAMRQ and FNMA last year for pennies and made 100,000usd (I started with 20,000). I watched those stocks very closely the entire time. This is a cut throat game I call it a game because it really is in the end your playing against many people it is a MMO pretty much. My rule is the 1000 share rule if you are going to invest you want at least 1000 shares in a stock so that $.01 change will give you a $10 change. At this point I buy in by the 10,000, but you get the idea. Use a brokerage that lets you place sells and buys or even trailing stops for extended periods of time just don’t get over charged.

  43. John D. Rockeyfeller says:

    Nice advice for a very beginner but MLP’s have done way better and at times bonds or preferred stocks are better. From 2000 to 2010 you would have done WAY better buying gold. One thing you have to do is read, study all markets and understand what “money” is! We use the Federal Reserve Note since 1971-Nixon and it’s the “Petrodollar” backed by oil being sold for it by many nations globally.(Reserve currency of the world-at least for now) The overall stock market has a close relationship to the price of oil’s direction!(it’s priced in oil dollars) You can trade markets but I always stick that oil chart on top as this is a petroleum based economy. Commodities can be traded, the oil crack spread, leveraged gold up or down, etc. but for long term investing I like a mix of preferred stocks of the biggest banks etc., municipal bonds of the safest areas which avoids a lot of taxes, a few REITS which pay much higher dividends, and for the next 20 years in the USA MLP’s which also pay much higher returns than stocks. Read or watch the “Prize” by Daniel Yergin! Google John J. McCloy and study everything and watch all markets it’s the real deal and yes when they kill the world markets like in 2007-8 you can make a fortune shorting or going to Treasuries then buying at the bottom! Warren Buffet in November of 2008 said he thought it was maybe a good time to buy stocks but he didn’t know if it was the “bottom”. I knew, it was March of 2009 when the oil price bottomed at 33 bucks a barrel. Stocks bottomed roughly the same time. Position your capital to take advantage of market movements like a crocodile, don’t trade to trade. Everything has to be sold at some point. Sue the schools that never teach truth and make your own investment decisions and yes charts are true pictures of real prices which you must watch.

  44. Steve M. says:

    BS. – Here are 5 strategies that really work for investing.

    1. Don’t buy any books or subscribe to magazines and newsletters offering investing advice.

    2. Pick 3 Mutual Funds – one, a US Broad Index – like the S&P 500, another a large cap World Fund and the last one a corporate bond fund, selected on the basis of 10 year performance and low management/expense fees. Never pay more than .98% in fees.

    3. Dollar cost average by feeding all the three funds automatically – in Bear or Bull markets, every month. Contribute as much as comfortable each month, but try to increase your contributions, proportionally, as your income increases.

    4. Don’t use stockbrokers, accountants who sell any financial or insurance products. Forget about collectibles, commodities, precious metals and antiquities, unless you are employed as an insider/expert. Even then, I’d limit your exposure to no more than 15%.

    5. Never sell shares or trade shares during a sudden down turn in stock prices. Start investing early – like in your late teens or twenties and stay in the game for the long term. After 20-30 years you’ll be amazed how well you’ve done

  45. Al M says:

    This book and his “5 rules” is just one of many, largely useless. Needs some English proofreading as well.

    Diversifying is exactly what mutual funds do – and many perform poorly, worse than GIC.

    Picking stocks using charts (a.k.a. technical analysis) is akin to woodoo magic.

    The book title is pretty lame, IMO – if there are as many as “101” rules to pick the stock, it means there are no reliable rules.

  46. Ify says:

    Bad advice!
    For anyone considering investing in the stock market investment. I would highly recommend reading the FT Guide to Investing by Glen Arnold. It lets you identify bad advice like the above when you see it.

  47. Colin says:

    By the time that this info, or any info, has become public it is all ready too late to use to get an edge on the market.

  48. John Camera says:

    There is no one expert over another. Economics and environment change daily. If you can, do what’s good for you. As Napolean Hill once said, “Nobody cares more about you, than you.” Don’t forget to keep a watchful eye and a little faith won’t hurt.

  49. Dr lurve says:

    I would get comfortable with cdf’s start with 20k leveraged to a possible 200k. Read lots of company knowledge etc and watch bloomberg like a hawk with 2 laptops open with your ig markets account ready to sell /buy and one with a real time market open.know the history of stocks and buy when they crash .then wait… never sell at a loss if it’s avoidable .global issues move shares but it does not usually mean the stock is dead,it’s a buying time.

  50. Sww says:

    Use charts? Really? If this is true then this author is right and Warren Buffett is wrong, because Warren Buffett stop using charts when he is 19.

    Read, study and learn how the best investor(s) in the past make their fortune. Why and how they success? What is their mistake? How Warren Buffett made his fortune? Who is Benjamin Graham?

  51. Matthew says:

    Invest in shares (only)? Rubbish advice

  52. Joe says:

    Here are some more tips on ‘intelligent investing’:

  53. Leonard Stern says:

    What about Binary Option Trading

  54. Alister Best says:

    It’s useless to diversify beyond 12 stocks,diversification must be across many sectors of the economy and markets for that matter.
    You’ll still be at risk if you buy 30 stocks within the same sector( e.g. Gold, Oil, or Financial sector), and you will be further at risk if buy these stocks in the same geographic market, e.g. British, German, or Japan market.

    Risk diversification need not to be beyond 12 stocks; the marginal benefits of 30 stocks is not greater than 12 stocks, yet a well diversified portfolio must be composed of many sectors of the economy and certainly within different geographic markets, e.g. British, Japan, USA, Brazil, and Canada.

  55. Jim White says:

    Would not want him advising me. If he does not know the difference between Shares and Stock. Hopefully he has the 30 Blackberry he was advised to buy and is now content.

  56. John says:

    Hopefully some of the people posting their (not “there”) comments are much better at investing than using proper grammar.

  57. BarryMiami says:

    Listen to Clem. Buy and hold. A 93 yr old man who made $1 Billion
    on Wall Street was asked his secret. “I never sold anything.” When
    starting out, buy index funds; you cannot outperform them. In 1987
    we invested our wedding gift money, $17,500 in about 6 Fidelity mutual funds and never touched them. Value today, $170,000. Separately we invested all we could and held on. When the market dropped in 2009, we
    sold nothing; it all came back and more. Today in retirement we have
    over 70 different companies yielding $26,400 in annual income. And by
    holding you take advantage of stock splits and dividend growth. We are
    realizing 6% return on invested capital. Day or short term trading mightmake you feel like you are a big shot trader, but you are really a fool. If you want to gamble go to a casino. Buy holding quality
    stocks, you are investing defensively and have at least 50% of your
    portfolio in global issues. And don’t buy stocks that do not pay
    a dividend, you do not want a non-performing asset. Buffet will tell
    that BH is a bad investment; no dividend. He got rich using OPM. POour dim that only your

  58. BarryMiami says:

    Listen to Clem. Buy and hold. A 93 yr old man who made $1 Billion
    on Wall Street was asked his secret. “I never sold anything.” When
    starting out, buy index funds; you cannot outperform them. In 1987
    we invested our wedding gift money, $17,500 in about 6 Fidelity mutual funds and never touched them. Value today, $170,000. Separately we invested all we could and held on. When the market dropped in 2009, we
    sold nothing; it all came back and more. Today in retirement we have
    over 70 different companies yielding $26,400 in annual income. And by
    holding you take advantage of stock splits and dividend growth. We are
    realizing 6% return on invested capital. Day or short term trading mightmake you feel like you are a big shot trader, but you are really a fool. If you want to gamble go to a casino. By holding quality
    stocks, you are investing defensively and have at least 50% of your
    portfolio in global issues. And don’t buy stocks that do not pay
    a dividend, you do not want a non-performing asset. Buffet will tell
    that BH is a bad investment; no dividend. He got rich using OPM.

  59. P. says:

    Some Financial advisors don’t even explain that with an ETF you can save half the cost of management fees, so don’t lose 2% a year to MER , buy some low stocks and let them rise; Blue chip stocks are preferable if you are young , and can wait 40 years, invest according to your age if you are 55 you are not going to make much on Exxon , Microsoft or JNJ stock, educate yourself as to what are the demographics telling you? aging population and are people going to stop using gasoline?, I think not. Set it and forget ” ,means you have lots of money already and a good wage.

  60. john says:

    Wow, your advice on use of charts is so damning of your opinion that it is laughable. It is far better to listen to the company, compare it to outside economic factors that are obvious such as its reliance upon transport, energy, energy type and the margin and product market penetration and then deciding on your own assumptions of the course of the future…but to say: well look at charts but switch to other charts because there are always new charts coming out…..hilariously silly.

    the 30 company diversity is a great idea, but should be divided into 4 sectors with 1 best of breed for two of those sectors at minimum and a short of the most overpriced worst of breed in the same sectors as a hedge that you can drop if there is a 10 percent price advance which for worst of breeds will likely cause an overall sector pop anyway, thus you would still have a gain overall, likely.

  61. steve says:

    I like Warren Buffett’s rules.

    Rule #1: Don’t lose money.

    Rule# 2: Don’t forget Rule #1.

    I believe William O’Neill likes to hold no more than 5-6 stocks at any one time but he does buy on the chart. (CANSLIM method).

  62. Virendra Patel says:

    Well,there r different ways and opinions for investment.I would say invest when there is panic and sell when there is booming market ofcourse you should get profits.This is very simple…the fool if making money is wise in this market.

  63. Right as Always says:

    I clicked on this link expecting some trite advice that anyone could have guessed with just a bit of common sense, but this is actually a pretty good article with useful pointers. Thank you to the author Clem Chambers.

  64. John says:

    I could not understand why a number 30 is proposed? Definitely it is a good method to generate wealth by investing long term in equity portfolios. Once create a portfolio from different sectors, after studying the company’s past & present performance, dividend pay-outs. Should keep buying at different dip levels.

  65. George Muzea says:

    Read “The Vital Few vs. The Trivial Many”
    It’s the only way to make real money and very well explained.

  66. Paul says:

    Rule 1 is fine if you invest lots of money otherwise the only winner is the broker

  67. Mikey says:

    It’s all rather moot advice if you are living paycheck to paycheck as indicated and can’t afford to buy stocks. Many people would be in deep doo – doo if they lost 30 share let alone 30 different shares.

  68. mohammedashraf says:

    I like Warren Buffett’s rules.

    Rule #1: Don’t lose money.

    Rule# 2: Don’t forget Rule #1.

    I believe William O’Neill likes to hold no more than 5-6 stocks at any one time but he does buy on the chart. (CANSLIM method).

  69. macdhui says:

    This article is so right – look at the bluest chip Tesco – then last week’s OPEC decision and the affect on oil stocks – groan ! … :) Spread out to 30 is a good maxim.

  70. Investor Boot Camp Online says:

    Some of this is absolutely the worst advice ever made up. The idea that you need 30 shares is ridiculous. Unless you’re running a mutual fund, no investor needs anywhere near that many. It just creates average performance and significant execution issues. I could go on, but this stuff is so bad, I need to go away.

  71. jessy says:

    an a very good information for a beginner in trading room……..

  72. Malcolm says:

    First rule of investing is protect your capital
    And secondly develope a system that suits your personality , that’s the dificult part
    Don’t stick ridgely or at all to what others say especially financial advisers who are in it for their own gain
    And if in doubt keep out of the market

  73. dumpster man says:

    there is only one true money just as there’s only one true GOD HIS NAME IS JESUS HIS MONEY IS GOLD & SILVER & BRASS INVEST IN IT and his kingdom and your time in his livin word in the end you will be walking on money transparent gold. repent turn to jesus for the wages of sin is death but the gift of god is eternal life in JESUS CHRIST OUR LORD


    FOUR YEARS AGO I DID NOTHING BUT LEARNT HOW TO INVEST AND NOT LET THE MAKERS TAKERS. THEN GOING THROUGH THE FIVE GOLDEN RULES AFTER PICKING 101 How to pick the stock market. every day i just discipline myself as the money began to double on to triple I had kept my nerve and kept to my targets and my book was my guide book.the impossible turned into incredible. I let all my profits invested to change into the big league and it was at this point I WAS really panicking as it was turning into millions and it was like a jackpot every day. When I look back to where i am today I never spent one penny after that very first investment and I will get through this year and start going into big investments with two major investors who heard about my discipline and 101 how to pick the stock market. The middle are 189% with to 725% and others higher.I have kept my head low now at the end of this year I will have properties around Europe and I am just a ordinary guy making big money in 2 other countries.I have not let this go to my head but I will still carry on what I am doing and making more than top football players earn every day easy.

  75. Ricardo says:

    All advises are general, contradictive & some of them are wrong.

    Rule 1 – Build a stock portfolio of 30 shares. – Why just not buy low-cost mutual fund or ETF?

    Rule 2 – Until you own at least 30 different shares never buy more than £1000’s worth of any share. – Why just not buy regularly low-cost mutual fund or ETF.

    Rule 3 – Get online and get the stock picking tools of modern investing. –There are too many tools online; most of them contradict each other.

    Rule 4 – Always pick stocks using charts.- You have to know how to use charts; it is not straightforward. Different type of investing needs different charts using approach.

    Rule 5 – Invest in shares for the long-term. – In this case you, probably, don’t need charts. Besides, investing in long-term is very general advice.

  76. malcolm says:

    Bosworth you are Just like Dumpster man, A Joker

  77. kingalanuk says:

    If you are lucky enough to be in a company that runs a share save syme then jump straight in on the plan I invested 9,000 over 3years and invested 9 thousand, I now get 800 pounds a year dividend and the shares are now showing a 20 grand profit, if the shares had gone down before the 3year plan I would just got my money back, brilliant, no risk

  78. Carcharodon says:

    Portfolio of 30 stocks? That seems like a lot.

    Easier to manage 20. Invest no more than 5% of your money in a stock. Make sure you don’t have more than 2 stocks in the same sector (eg: Banking). This will protect you when a certain sector gets hit, like banking, or oil. When they go down, your other shares should be keeping you ahead of the game.

    Always pick dividend paying stocks, this will help your portfolio grow over time. Use the dividend reinvesting program. This usually gets you the shares commission free depending on who you trade with.

    You can speculate on non-dividend paying shares too….think long term.
    Something like Facebook for example. In 10 years it may be the next apple or google…then again, it may not. Don’t put more than 5% of your money into it though. I’d say depending on your risk tolerance, don’t invest more than 20% in speculative stocks. So you could have 16 dividend paying shares and 4 shares you expect to soar over the long term.

    Slow and steady wins the race. Avoid penny stocks unless you’re a gambler.

  79. Ed Vaughan says:

    Whilst it is most unwise to put all ones egg in the basket by investing heavily in one share it is also foolish to spread the load over 30 stocks, you just cannot live a normal life and keep abreast of what is going on with 30 different companies. 15 is ample and you can always be ready to move quickly if a general situation demands it. Forewarned is Forearmed!

  80. michael burns says:

    a very interesting article

  81. David says:

    I believe you need to determine first what you want from your investment a reasonable dividend from your shares or looking for a good increase in it’s value to sell on
    First guide never use money you can’t afford to loose , well no one can afford to loose money so that saying is a bit pointless.
    Having lost a good few thousand pounds on shares Bradford & Bingley to name one and who saw that coming ! , those in the know .
    The idea to buy shares on a Black Friday has held firm you will never buy at the lowest price and as soon as you buy they will continue to fall and when the markets recover and you decide to sell they will continue to rise and how ever much you make you will still feel cheated you did not make more it’s only human nature
    You need to decide what your limit’s are how much you want to make or percentage margin
    5% works for me a lot more than an ISA or saving’s account share churning buying and selling on the up’s and down can make you money but you can find your self sitting on the shares in limbo if you set your hopes to high then watch them fall away in price when you like to be buying again
    It’s a game and like all games the more you play the better you will get or in some people’s case
    Last Note : It is best to have played and lost then never had played at all

  82. ME says:

    Dreadful article – complete rubbish

  83. mia says:

    merry christmas and happy

  84. marlene says:

    very interesting thankyou

  85. Ian Strachan says:

    Rules of Investment :
    1. Don’t put all your eggs in one basket.
    2. Don’t invest in anything you don’t understand.
    3. If it sounds too good to be true then it probably is.

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