Page 910 - How to Make Money in Stocks Trilogy

162 HOW TO MAKE MONEY IN STOCKS SUCCESS STORIES

down on heavy volume, signaling some potential trouble for the market. Jim
reduced his market exposure by 50% and was able to preserve the gains in
his account by moving entirely to cash within a couple of days.
For the rest of 2011, the market was choppy and difficult to trade. Jim
allowed himself to get swayed by all the problems in Europe, so in
December 2011, when the trend of the market changed and began to head
up again, he was late to the game.

Staying in Sync with the Market
Jim notes that identifying the market trend is the trickiest yet most criti-
cal part of investing. “You have to stay in sync with the market and not
argue when leading stocks begin breaking out and heading higher,
because it is then and only then that you are positioned to make a lot of
money in the market.”
Despite mistakes, Jim has complete confidence that he will capture a
piece of several new leaders in every cycle: “There are huge winners in
every bull cycle, and the more you use the CAN SLIM Investing System,
the more your confidence builds that you’ll be able to find and profit from a
big winner.”
Jim is modest and self-effacing in discussing his successful career,
reminding investors that he loses money on at least half the stocks that he
buys, but he keeps his losses small and says that “it only takes a few big
winners, if you handle them correctly, to significantly improve your life
financially.”

• KEY POINTS •

• Pay attention to stocks that appear in IBD almost every
day.

• If you get shaken out of a stock that drops below the 50-day
moving average, consider going back in if it retakes that
line by the end of the day.
• Look for stocks with the “big stock criteria,” something
completely new and innovative that is in big demand.
• Many of the market’s biggest winners will have come pub-
lic within the prior eight years of their big price moves.