Some of the same rules apply when trading women. Always buy low and sell high. For instance, if i wanted to trade a distressed security that i think still has a lot of intrinsic value, i would go balls long Britney spears right now...... all the institutions have dumped her and there is a large short interest (probably about 50 % of float). I'm sure she is trading OTC right now as a penny stock.... She is so out of favor its ridiculous. I am sure warren buffet and charlie munger are accumulating massive long positions right now. Right now i would be buying calls, selling puts on Britney. I would short paris hilton, the chart on her is showing a very bearish head and shoulders pattern.
The traditional rules of portfolio managment apply. Diversification is a must. Buy and hold can leave you feeling pain, and of course, falling in love with a position is very risky. While a hard dollar stop should always be used, a time stop is also a good idea. Some of the more attractive issues have a nasty tendency to spring preannouncements on you without much warning, leaving your portfolio and possibly you unbalanced. Stay away from issues looking to enhance value by merger and acquisitions acitivity.