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Gartman's Annual Rules For Trading

Few traders have enjoyed such a distinguished career as Dennis Gartman.

He’s is perhaps best know for his newsletter, aptly titled The Gartman Letter. It’s a commentary on the global capital markets that goes out daily by 6am.

However, Gartman is much more than a strategist – he’s also an accomplished trader in his own right with a wide range of experience including chief financial futures analyst for A.G. Becker.

He was also the brains behind the futures brokerage operation for the Virginia National Bank.

And through the years Gartman has seen it all - booms and busts; bears and bulls. How has he managed not only to survive but thrive? He lives by a set of rules.

1. Never, Ever, Ever Add to a Losing Position
2. Mental Capital Trumps Real Capital
3. Think Like a Fundamentalist; Trade Like a Technician
4. Complexity Breeds Contempt
-Dennis Gartman, The Gartman Letter

It’s all about capital preservation, says Gartman. Do more of the things that are right and try and do less of the things that are wrong.

If you buy a $15 stock and it goes to $20 buy more, he says. The market is telling you that you’re doing something right.

And if you buy a $20 stock and it goes to $15 get out. The market is telling you that you’re doing something wrong.

Words to live by.




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Trader disclosure: On Nov. 25th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Seymour Owns (AAPL), (BAC), (EEM), (FXI), (INTC); Terranova Owns (SU), (GOOG), (AAPL); Terranova Owns (UNG) April 2010 Calls; Terranova Owns Gold Futures; Terranova Owns Nat Gas Futures; Grasso Owns (AAPL), (BA), (BAC), (C), (COST), (PFE), (V), (WMT)

For Steve Grasso
Stuart Frankel Owns (NYX)
Stuart Frankel Owns (SDS)
Stuart Frankel Owns (TBT)
Stuart Frankel Owns (PDE)
Stuart Frankel Is Short (QQQQ)

For Dan Binder
Jefferies Has Received Compensation From (BJ)
Jefferies Makes A Market in (COST)
Jefferies Has Received Compensation From (LOW)
Jefferies Makes A Market In (SPLS)
Jefferies Has Received Compensation From (USTR)


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