Eleven Trading Tips

1. Some people spend all day talking to their brokers. Soros “prefers to talk to a select few people who can be really helpful ….” Then you need to think and read and reflect.

2. To be successful, you need leisure. You need time hanging heavily on your hands [to talk to people, read, and think].

3. If you have an investment thesis you like, run it by people who support the other side of the argument. See if you still like the thesis afterward.

4. Basically, the way Soros operates is to have a thesis and then he tests it in the market. If the market goes against his position and he feels uneasy (e.g. gets a backache), he cuts his losses.

5. What he took was basic information from various sources and kind of mulched it in his mind. Then he would come up with a thesis that most of the time was valid.

6. When Soros believed he was right … no investment position was too large. Holding back was for wimps. The worst error in Soros’ book was not being too bold.

7. The key to investing is knowing how to survive. That means at times playing conservatively, cutting losses when necessary and keeping a large portion of one’s portfolio out of play.

8. If you are doing poorly, retrench. Don’t try to recoup. And when you start again, start small.

9. To be in the game, you have to be willing to endure the pain.

10. Perhaps Soros’ most distinctive feature, the trait that explained his investment talents the best, was his ability to gain membership in a very ‘exclusive ‘ club that included the leadership of the international community…. Such encounters clearly gave Soros an advantage over other investors.

11. Invest first and then investigate … form a hypothesis, take a toehold position to test the hypothesis, and wait for the market to prove you are right or wrong.