market folly

Market strategist Jeff Saut is out with his latest commentary entitled "Darvas Discipline."  He titles it so because he references Nicolas Darvas in a passage from his book, How I Made $2,000,000 in the Stock Market.

Darvas wrote,

"I knew that I had to adopt a cold, unemotional attitude towards stocks; that I must not fall in love with them when they rose and I must not get angry when they fell; that there are no such animals as good or bad stocks.  There are only rising and falling stocks - and I should hold the rising ones and sell those that fall.  I knew that to do this I had to achieve something much more difficult than anything before.  I had to bring my emotions - fear, hope and greed - under complete control ... I started to see that stocks have characters just like people.  This is not so illogical, because they faithfully reflect the character of the people who buy and sell them."

He then touches on the concept of tracking stocks with favorable technical setups but then only buying when they give a fundamental reason for doing so: improving earnings power.


Embedded below is Jeff Saut's latest market commentary: Darvas Discipline



For more, check out Saut's other recent commentary where he noted Steve Eisman thinks the US is destined for slow growth.