1. Never play macho with the market and don’t over trade.
2. If I have positions going against me, I get out; if they are going for me, I keep them.
3. Decrease your trading volume when you are trading poorly; increase your volume
when you are trading well.
4. Never trade in situations you don’t have control. I don’t risk significant amounts of
money in front of key reports, since that is gambling, not trading.
5. If you have a losing position that is making you uncomfortable, get out. Because you
can always get back in.
TOP 13 TRADING RULES OF PAUL TUDOR JONES
6. Don’t be too concerned about where you got into a position. The only relevant
question is whether you are bullish or bearish on the position that day.
7. The most important rule of trading is to play great defense, not offense.
8. Don’t be a hero. Don’t have an ego. Always question yourself and your ability. Don’t
ever feel that you are very good. The second you do, you are dead.
9. Everything gets destroyed a hundred times faster than it is built up. It takes one day to
tear down something that might have taken ten years to build.
10. Markets move sharply when they move. If there is a sudden range expansion in a
market that has been trading narrowly, human nature is to try to fade that price move.
When you get a range expansion, the market is sending you a very loud, clear signal
that the market is getting ready to move in the direction of that expansion.
11. You always want to be with whatever the predominant trend is.
12. My metric for everything I look at is the 200-day moving average of closing prices. I’ve
seen too many things go to zero, stocks and commodities. The whole trick in
investing is: “How do I keep from losing everything?” If you use the 200-day moving
average rule, then you get out. You play defense, and you get out.
13. At the end of the day, your job is to buy what goes up and to sell what goes down so
really who gives a damn about PE’s?