Page 942 - How to Make Money in Stocks Trilogy

Grandmaster: Legendary Investor Bill O’Neil 191

Bill is never married to an opinion, and this includes the overall market
trend as well as leading stocks. He remains flexible, which is one of his
greatest strengths as a trader. He is not stubborn and feels no need to be
right. Ego is the death of success, and Bill learned this a long time ago
watching many investors lose everything because of an inflated ego and the
need to be right all the time.
As an example of Bill’s flexibility, he was very bearish in 1999 before the
last and final run that the market made. But when the market issued a fol-
low-through day in September of 1999, he totally changed his mind and
accepted what the trend was telling him.
Bill could also be glowing and excited about a stock but will immediately
move on if he’s wrong and not give it another thought. He has no need to be
right, and makes no apology if he is wrong. Bill simply moves on to what the
market is telling him. He truly lives in the moment.

Charts Tell You What Is Really Going On
Bill looks at charts above everything else and is always searching for new
ideas. He studies charts and goes through many graphs on the weekend. Bill
flips through them until something catches his eye about the pattern. He
has a nearly photographic memory of charts going back in history, and this is
probably his greatest gift. Bill can see a stock setting up in a pattern that
looked the same as another winner from previous decades. This skill can be
learned, perhaps not to Bill’s level, but it can be achieved by studying previ-
ous market winners and recognizing what they looked like prior to making
their big price moves. One hundred charts are annotated with chart patterns
and descriptions of the overall market trend in the beginning pages of How
to Make Money in Stocks.

“Every stock is like a person; it has a personality. I study
stocks the way I study people. After a while, their reactions
to certain circumstances become predictable.”

—JESSE LIVERMORE

“Some stocks are steady movers; others have more volatile
price swings. Know what you’re dealing with.”

—WILLIAM J. O’NEIL