With the U.S. stock market at its highest levels in six years, individual investors—many of whom were burned during the financial crisis—are developing equity investment strategies, anxious to avoid mistakes from the past. But deciphering the dynamics of today's market is tough. In his latest book, "Get Rich Carefully," CNBC's Mad Money host, Jim Cramer, gives readers advice on how to keep their hand on the pulse of the market, invest prudently and avoid miscues. Here's an excerpt.
If we are to invest successfully in this new, more treacherous environment, we are going to have to recognize the bizarre stock movements have become a staple, if not a hallmark, of this era. Before we can even get to the buying and selling of individual stocks in order to create wealth, we have to understand how stocks are impacted by both understandable events and what seem to be random gyrations that baffle and frighten us.
We have to accept that stock gyrations often don't have much to do with the day-to-day success or failure of the individual companies they are meant to track. Here are the six factors that moves a stock:
If you want to invest carefully, and not just think you are investing carefully, consider this checklist before you buy or sell another stock.
—CNBC's Jim Cramer. Follow him on Twitter @jimcramer.
Text copyright © 2013 by J.J. Cramer & Co. From JIM CRAMER'S GET RICH CAREFULLY, reprinted with permission from Blue Rider Press, a member of Penguin Group (USA) LLC.