Twenty Stock Market Tips

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1. Buy High and Hold. Do not try to “buy low and sell high.”

2. Buy companies that have a record of increased earnings.

3. Look at a stock’s Price/Earnings ratio. Long-term average is 14.

4. Favor companies that regularly increase their dividends.

5. Favor companies that plow back some of the annual earnings.

6. Invest primarily in “growth and income” stocks.

7. Buy companies whose officers own a lot of the company’s stock.

8. Buy companies that have good management (officers & board).

9. Adopt a “buy and hold” strategy for stock ownership.

10. Keep constant the stock percentage of your investment portfolio.

11. Have a diversified plan for your investment portfolio.

12. Subtract your age from 120 and invest that % in common stocks.

13. Invest in 3 classes of stocks: U. S., foreign, and “hard asset” stocks.

14. A third of your common stocks should be invested in foreign companies.

15. Have some non-dollar assets such as foreign stocks and bonds.

16. Rebalance your portfolio at least once a year.

17. Do not let your stockbroker talk you into frequent trades.

18. Don’t be “greedy.” Stocks will gain an average of 11% annually.

19. Use primarily “no load” mutual funds or ETF funds.

20. If you have a large portfolio, hire a professional manager.

Photo by Annie Spratt on Unsplash

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George Marotta served in the U.S. Army in the Pacific, graduated from Syracuse University, worked in U.S. foreign affairs and Stanford's Hoover Institution, and founded a financial firm in Palo Alto. He is mentor and father of David Marotta.