Ace US-based trader/investor Mark Minervini tells us that he started in 1984 with a few thousand dollars but “I later added some money to bring my account up to 30k.” He reckons it took time to build his account to a substantial amount of capital, but once he had a few big years, “the compounding really started to take effect.”
He’s not kidding either, telling us “I ran that account up over thirty-four thousand percent.” I’ll let you do the maths to work out the fortune he’s sitting on now, and all from $30,000 – amazing.
Don’t lose money
One of the main themes he talks about is to avoid big losses. He reckons that everyone makes mistakes, but “correcting a mistake or minimising the damage of a position gone wrong is completely under your own control.” He says the big mistakes start out as small mistakes that were allowed to get out of hand. Therefore we must realise that “big losses are a choice and take responsibility for controlling them.”
Like the famous Warren Buffett, he says the trick is to avoid losing money. “That may sound like I’m joking, but I’m not. Lose the least amount possible when you’re wrong. Get good at that and you’re 90% there.” To him, that means buying stocks with good upside potential and being careful to lose as little as possible when he’s wrong. In other words, he cuts his losses when a share moves against him.
Broadcasting loud and clear
Apart from reading his books, I think a great way of tuning into his hard-won market wisdom is to follow him on Twitter, Mark Minervini @markminervini. He’s still active in the stock market and loves to share his experiences on a day-to-day basis as well as peppering his feed with pearls of wisdom gleaned during his more than 30 years’ trading and investing.
Here’s a snapshot of what he’s been tweeting lately.
- The key to being a great trader is learning how to make quality choices and minimising mistakes. Focus on the process, not the results.”
- “When you get the process right, the results come as a natural by-product.”
- “Successful investors can disconnect emotion from investment decisions and can differentiate business performance from stock performance.”
- “Once you have skills and a strategy with an edge, successful trading requires sticking to your core competence and avoiding style drift.”
- “Your job in trading is to isolate and master the steps of performing well… if you successfully execute these steps the results will follow”
I reckon those tweets are self-explanatory. But he builds on the library of knowledge and wisdom almost every market day with new tweets. To me, tuning into Minervini’s twitter feed is a great augmentation of the wisdom contained in his self-penned books, which you can find online.
I’ll leave you with one last motivating tweet:
- “A “loser” is just someone who hasn’t yet learned how to tap into the winner inside… knowledge, belief, action, post-analysis – repeat.”
Good luck on your investing and trading journey.
Kevin Godbold has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.