In The Trading Cockpit with the O'Neil Disciples: Strategies that Made Us 18,000% in the Stock Market

CHAPTER 1

The OWL Ethos

Determining If the Methodology Is for You

One of the most fundamental axioms of trading and investing is that one should select and stick with a methodology that melds well with one's personal psychological makeup. A simple example might be that someone who has trouble sleeping at night when they are invested in stocks should not use an aggressive system that employs leverage or invests in securities that display a great deal of price volatility. From our perspective as O'Neil-style traders and investors, we find that our psychology and attitudinal approach to investing, our investing ethos as we called it, is best represented by what we now like to refer to as the OWL ethos. Why OWL, you ask? Because it represents the surname initials of three of the greatest traders of the last 100 years—William O'Neil, Richard Wyckoff, and Jesse Livermore. All three shared the same investing ethos, and their trading strategies and ideologies overlapped to a great degree. We discussed this close relationship between the investment methods and philosophy of all three of these gentlemen in Chapter 1, “The Evolution of Excellence,” in our first book.

Success with OWL-based methodologies lies in the degree to which one's psychological makeup and concomitant approach to stock market investing can exist in fluid harmony and synergy with the OWL approach. Thus investors interested in learning our general methodology need to ask themselves whether the OWL is really for them. ...