Advice From Phil Carret

By Ramesh Akkineni
Carret's "12 Commandments of Investing":

1. Never hold fewer than 10 different securities covering five different fields of business;

2. At least once every six months, reappraise every security held;

3. Keep at least half the total fund in income producing securities;

4. Consider yield the least important factor in analyzing any stock;

5. Be quick to take losses and reluctant to take profits;

6. Never put more than 25% of a given fund into securities about which detailed information is not readily and regularly available;

7. Avoid inside information as you would the plague;

8. Seek facts diligently, advice never;

9. Ignore mechanical formulas for value in securities;

10. When stocks are high, money rates rising and business prosperous, at least half a given fund should be placed in short-term bonds;

11. Borrow money sparingly and only when stocks are low, money rates low and falling and business depressed;

12. Set aside a moderate proportion of available funds for the purchase of long-term options on stocks in promising companies whenever available.

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