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Gene Marcial’s 7 Commandments of Stock Investing

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“Gene Marcial provides iconoclastic insights into the art of successful investing while exploding the mythology of the conventional wisdom. His 7 Commandments of Stock Investing is scintillating reading for both individual and institutional investors who seek an advantage in their moneymaking endeavors.”

--Scott Black, President of Delphi Management Inc. and a member of the Barron’s Roundtable

“It is well understood that trading in the stock market is full of risks. But if you are ready to take the plunge, I guarantee that there will be a time when being familiar with Gene Marcial’s 7 Commandments of Stock Investing will be extremely important. Over the years, I have followed many of the same commandments.”

--Carl Icahn, Chairman, Icahn Associates

“This book begins with one of the wisest investment observations I’ve ever encountered: ‘There are plenty of ways to make money in the stock market, but clinging to mainstream thinking or so-called conventional wisdom is not one of them.’ The author’s discussion on avoiding the diversification trap is alone worth many times the price of this book.”

--Bernie Schaeffer, Chairman, Schaeffer’s Investment Research, Inc.,

“Gene Marcial has been guiding literally millions of investors to better financial performance over his more than 30 years as a leading financial journalist. He consistently has demonstrated a rare instinct for knowing when to follow a trend and when to think like a contrarian. In today’s turbulent times, his new book, 7 Commandments of Stock Investing, is essential reading for all investors and could well add precious percentage points to the performance of any who take his words to heart.”

--Stephen Leeb, President, Leeb Capital Management Inc.

Every week, the investment world turns to Gene Marcial’s BusinessWeek column. Here’s why: Marcial knows how to pick winners. Apple at 15. US Steel at 19. But Marcial’s track record isn’t limited to just one or two picks. In fact, recent analysis reveals that he’s beaten the indexes for a full decade.

You can’t get results like that following the “conventional wisdom”! You need to know what Gene Marcial has learned about stock investing--and this book will tell you. Marcial has distilled 35 years of experience into seven powerful, counterintuitive “commandments”: rules that are simple and practical enough for every investor to profit from.

Marcial reveals why diversification is not an optimal investment strategy…why you need to focus on finding big winners, and how you can…how to profit from panic, and how to lock in your profits when everyone else is “fat and happy.” Along the way, he opens up the secret, mysterious world of corporate and market insiders--showing how to track them down, emulate their approaches, and profit from their lucrative strategies.

  • Be prepared to profit from panic
    Plot a clear strategy to seize opportunities during a macro-market panic

  • Learn how to “buy the losers”
    Finding tomorrow’s big winners in today’s bargain bin

  • Profit from the unknown
    Finding investments that are undervalued because investors don’t understand them

  • The “sweet seven”: specific stock picks for the next seven years
    What to buy right now--and hold for the long term

  • Table of Contents

    1. Copyright
      1. Dedication
    2. Foreword
    3. Acknowledgments
    4. About the Author
    5. To the Reader
    6. Introduction
    7. 1. Buy Panic
      1. Uncontrolled Fear
      2. Expect the Unexpected
      3. Buying Stocks in Trouble
      4. Distress Investing
    8. 2. Concentrate. Diversify Not
      1. Cruise-Control Strategy
      2. Basic Research Is Vital
      3. When Should You Sell?
      4. Rewards of Concentration
      5. Best Buy: Is It Ever!
      6. Don’t Catch “Falling Knives”
      7. U.S. Steel: Definitely a Big Steal
      8. New Century Financial—an Early Catch
      9. AMR: Up High in the Sky
      10. Northwest Airlines: Still Northbound
    9. 3. Buy the Losers
      1. Winners Disguised as Losers
      2. Watch the High-Profile Stocks
      3. Homebuilders: Ripe for the Picking
      4. The Price Earnings Ratio Puzzle
      5. RIMM: A Stock in Motion
      6. Time Warner: The Giant Has Awakened
      7. Merck: A Prescription for Winning
      8. Other Fallen Angels Ready to Fly
      9. Ford: Not Destined for the Scrapyard
      10. GM: Not in No Man’s Land Anymore
      11. Motorola: Will It Recover Its Mojo?
    10. 4. Forget Timing
      1. Market-Timing Technicians
      2. Timing: Underwhelming Results
      3. Institutional Investors Love Timing
      4. Retail Stores: Not Necessarily Bargains
      5. Banks: Banking on Some
        1. Citigroup
          1. Vikram Pandit Takes the Helm
          2. Down but Definitely Not Out
        2. Bank of America
      6. The Peter Lynch Principle
    11. 5. Follow the Insider
      1. The Insiders’ World
      2. A Case of Insider Trading
      3. Keep an Eye on Insiders’ Pals
      4. The Warren Buffett Watchers
      5. Warren Buffett Wannabes
      6. Pressure from Big Stakeholders
      7. Wild Oats Markets, Inc. (OATS)
      8. PriceSmart, Inc. (PSMT)
      9. Oakley, Inc. (OO)
      10. CECO Environmental Corp. (CECE)
      11. Kos Pharmaceuticals (KOSP)
      12. Ferreting Out Takeover Targets
    12. 6. Don’t Fear the Unknown
      1. The Far-Flung Markets
      2. China’s Booming Market
      3. Cutting in on Undervalued Stocks
      4. Mutual Funds
      5. Exchange Traded Funds (ETFs)
      6. American Depositary Receipts (ADRs)
      7. The Biotechs
      8. How the Pros Check Out the Biotechs
      9. Scrutinize the Managers
      10. Biotech ETFs
      11. Advanced Neuromodulation Systems (ANSI)
      12. Cleveland BioLabs (CBLI)
      13. MedImmune (MEDI)
      14. Some Unrecognized Attractive Biotechs
        1. Enzo Biochem (ENZ)
        2. Rosetta Genomics (ROSG)
        3. Access Pharmaceuticals, Inc. (ACCP)
    13. 7. Always Invest for the Long Term: Seven Stocks for the Next Seven Years
      1. The Innovative Apple
      2. Boeing—The High-Flying Super Machine
      3. CVS Caremark Corp: The Number-One Value Drug Store Chain
      4. Genentech: The Biotech Behemoth
      5. JPMorgan Chase & Co.: Up on Wall Street and Main Street
      6. Petróleo Brasileiro S.A.: An All-Around Energy Play
      7. Pfizer, Inc.: The King of Big Pharma
    14. Epilogue
    15. Financial Times Press