Sun Tzu: Know Yourself

More from Sun Tzu On Investing

When you know others, then you are able to attack them. When you know yourself, you are able to protect yourself. Attack is the time for defense, defense is a strategy of attack.

If you know this, you will not be in danger even if you fight a hundred battles. When you only know yourself, this means guarding your energy and waiting. This is why knowing defense but not offense means half victory and half defeat.

Pg 12.
Before you think about buying stocks, you should have made some basic decisions about your trust in corporate structures, about whether you can control your fears of economic loss, about what you expect in short-term or long-term oriented, and about how you will react to sudden and unexpected moves in the market and the price of your stocks. It is essential to clarify your objectives, expecatations and attitudes beforehand, because if you are undecided and lack conviction at critical points, then you are a likely victim, one who abandons all hope and reason at the worse moment and sells investments at a severe loss just to escape. As legendary fund manager Peter Lynch says, "It is the personal preparation, as much as knowledge and research, that distinguishes the successful stockpicker from the chronic loser. Ultimately it is not the stock market nor even the companies themselves that determine an investor's fate. It is the investor."

Here is another issue for consideration...

Do you know what you are doing?

Are you investing...

or...

do you think you are investing but in all reality you are merely speculating?

I think this is as much as an important issue for our stock market players, don't you agree?