His latest work adds to his reputation for books that not only provide important insights into the winning investment strategy, but are also good reads. This little book is filled with sage counsel from which even sophisticated investors can benefit. Among the pearls of wisdom are three commandments Zweig put in biblical language to emphasize their importance.
- Thou shalt take no risk that thou needst not take.
- Thou shalt take no risk that is not most certain to rewarded thee for taking.
- Thou shalt put no money at risk that though canst afford to lose.
- Avoid putting your human capital and your financial capital in the same basket, meaning don't hold large positions in your employer's stock.
- Own TIPS to fend off inflation.
- Avoid "newfangled" securities that promise "higher yield at low risk," "safety with more income" or "returns better than cash with no risk."
- Don't stretch for yield with bonds.
- Quoting Shelby Cullom Davis: "You make most of your money in a bear market; you just don't know it at the time."
- Avoid leveraged and inverse ETFs. (More on this Friday.)