Summary of Martin Zweig, winning on Wall Street

These are quotes and summaries of what I learned from Martin Zweig’s Book, ‘Winning on Wall Street.’

When fed tightens and interest rates rise, stock markets perform poorly, and visa versa

When fundamentals for a stock deteriorate, sell it and don’t refuse to take a loss as can’t afford to bruise your ego.

Accept your mistakes, deal with them and learn from them.

In baseball a person who hits 2/3rds of the balls is in the Hall of Fame, so don’t expect to get it right all the time.

Look at stock market’s P/E ratio, dividend yield and book value to see if it is over valued, especially during periods of speculative mania.

Only a fool can be totally sure.

Deal in probabilities not certainties, so the aim is strategy and not preaching.

Page xvii, If he thinks that the market will probably crash in a particular month and does a put for it, it will still only put 1% of his assets into it. This is because it’s about probability and the puts will be worthless if it doesn’t happen in that particular month, or go down to enough of a degree to make it worthwhile.

Reality is cutting the risk to the bone when the indicators weaken, hoping that you will make a few bucks when conditions are good, and praying your survive the crashes so that someday you can make money in the bull markets and have money left to do so.

He breaks historical composite readings into 10 deciles, such as top 10% etc.

He is measuring monetary, sentiment and tape (the total stock market price) conditions.

A credit crunch is where the yield curve turns negative.

If the stock market has a grossly overvalued P/E ratio and yields, has been rocketing upward for years without a major correction, which has produced doubles or more in the Dow, things get risky.

A crash is coming if whenever there are minor dips people think the solution is not to fear the dips and just to buy more.

You need constant access to reliable market indicators, and when they tell you to do something, you do it. The mistake is to ignore or distrust your own indicators, like a pilot second guessing their compass.

The key is patience to wait for the fat baseball pitch and not just swing at anything. Only do it when the odds are in your favor as the indicators are in the right direction.

Page 2, from mid 1980s to 1995 the Zweig forecast had a return of 898.9%, on a compounded basis that is a 16% annual return why.

Page 3, book doesn’t track all the variables he tracks on the market activity or it would get hopelessly complicated. So he has simplified his approach to make it understandable and workable for the non-professional reader.

The major direction of the market is dominated by monetary considerations, primarily Federal Reserve policy and the movements of interest rates. To monitor these he has several indicators but he has found to be very reliable.

Momentum is like a rocket being launched to the moon, if it takes off with a lot of thrust, it has a chance of making it out of the Earth’s atmosphere. Without this momentum it will flop. This momentum is the final arbiter of any investment decision, he never fights it.

Picking falling shares because you think they have hit the bottom is dangerous. It is easier, safer and in most cases just as rewarding to wait until they have hit the bottom and taken a little bounce upwards before buying them.

He uses sentiment indicators as early warning systems and it’s suprising how often do called expert opinion can be.

He monitors fundamentals, which is the actual value of a particular stock, such as earnings, dividends and balance sheets.This only helps with individual stocks, not the whole market. 90% of input on stock picking is from the fundamentals, then 10% from predicting the market as a whole.

Big money is from being on the right side of major moves, not from swimming against the tide.

Be fully invested when market going up and fully in cash when goes down.

Trends have a higher probability of continuing than not.

2/3rds of the time markets are neutral, or rising and declining moderately. During this time might trade profitably selecting the right individual stocks, but investing in the whole market during a strong bull market gets the best returns.

Pick stocks with P/E ratio, earnings trend and a few balance sheet items. Not care what makes, as long as consistent earnings for 4-5 years.

Not buy stock at the bottom, buy if going to climb and acting well relative to the market. Buying on strength costs a premium, but increases possibility of being right.

It’s not buy at the bottom and sell at the top, it’s buy when the probability is greatest that the market will advance.

If bottom is 4000 and top is 6000, you buy at 4300 if let’s say 90% probability it will go higher. You might sell at 5700 when probability is good that the market will decline.

It’s about probability of loss or decline.

You are cutting losses and running with profits.

You can be right with individual stocks as little as 30% of the time and still do well, if you can get out when the getting is good

Follow and don’t fight the trends.

You want to get out so you are able to pursue future gains.

You have to make mistakes to come up with something that really works. Benjamin Franklin, ‘The things that hurt instruct.’

Uses stop losses (sell orders at predetermined levels) to stop him fighting crippling battles. Whenever buy a stock, he generally sets them 10-20% below current level. Level depends on stock’s trading pattern.

If stock goes up, he raises the stop loss price so still protected.

They might sell a stock that then rises again, but the probabilities are that they save you and there is always another stock

Need to be flexible, so take advantage and be aggressive when during the less common times you should be so, then the rest of the time be conservative.

Most important trait in investing is discipline to follow your method and not be tempted by things that weaken your resolve, such as a ‘hot tip’ someone gives you.

Second most important is flexibility. Eg. bearish when the market is collapsing and people think that brokerage houses are going to go bust, but then bullish if the Fed steps in and a rally starts that looks like it’s going to continue.

Whatever preconceived ideas you have, you respond to changing conditions

You need:
1, Discipline
2, Flexibility
3, Patience

You wait for the tape to give it’s message before you buy or sell

Stay in tune with the tape and interest rates.

As a kid he loved numbers.

Committee made decisions in the stock market tend to be mediocre, he’s never heard of a great investor who operated by committee

You need to be alert to never get caught in a stock market collapse.

The whole idea with Graham, Dodd, and Cottle is to buy stocks with good value that are selling at reasonable multiples and paying satisfactory dividends, and to make allowances for risks.

He wanted to look at the movement of markets as a whole, about technical factors such as the market’s own price action, crowd psychology, or the impact of the Federal Reserve and monetary and economical variables.

Let your profits run and cut your losses, as Jesse Livermore did.

Professor Wade Young ‘Buy on strength, sell on weakness.’. Most novices think it is ‘buy on weakness and sell on strength’, which is how they get themselves into trouble in the market.

Technical analysis in purest form is study only of those variables you can see on the ticker tape, namely price and volume.

He went through data from the securities and exchange commission going back to world war II  and found that-

-When options investors got two optimistic – buying lots of calls ( the option to buy 100 shares of a company stock price at a specific price over a stated time period) and shunning puts – the stock market was genuinely heading for trouble.

-Also the reverse, when options players were very bearish on the markets favoring puts (the right to sell 100 shares of a company stock at a stated price within a specified period of time) and selling or avoiding calls, the market was usually near the bottom.

– when option players were extremely active, it was a negative sign.

– when option players shun the markets and option volume dropped off, it was frequently a good time to buy.

Basically the old country opinion, ‘don’t follow the crowd’.

From this he invented the puts/call ratio technical benchmark.

He found that most speculators were not very successful and on balance lost money. They weren’t right very often regardless of whether, as a group, they were bullish or bearish.

Commiting suicide

Some people want to commit suicide because they feel huge amounts of shame.

This is often because they were taught to do things in their formative years, such as maintain a family business and they failed.

As they are not doing or achieving what the tribe says they should be, they are ashamed.

It shows how big pride is from doing what the tribe tells them they should be achieving.

Being engaging with an audience

Engaging people is about energy, whether it’s your movement, emotions feelings, and so on. These are just ways of conveying and giving energy. You need to have lots of energy as that’s what people want.

When you get it right, you are giving so much it’s almost like putting on a dance or spectacular for people.

You mustn’t be at all uncomfortable as then you will make the audience uncomfortable. You can do many bad things on stage, but that is the worst one that is unforgivable as it will repel people.

You mustn’t think about yourself, or how you were coming over, this is ego. If you think about yourself, what people think of you, what they are thinking about how you look and so on, you will become defensive.

If you are being defensive then you cannot openly put all into pleasing the audience.

You have to listen to the audience and please them. Then if they are pleased you will be engaging them.

The audience is interesting, has their lives, and each person has different needs and wants, you must listen to the audience.

If you are interested in what you are doing, other people will be as well. You must have a passion, energy and enthusiasm about what you’re doing. You must also be really excited about it, so they are too.

You also have to sell it, if you think it’s brilliant, other people will as well. You have to behave and be like what you are doing is brilliant.

You also have to be happy, people like to be with people who are happy.

You also behave like you love the person, nothing is too much trouble, you would do anything for them as you love them so much.

Being entertaining is also important, people love to be entertained, such as by telling jokes. If you are boring then nobody wants to be with you.

It’s about life, being alive, having fun.

Whatever it is, even if it’s boring, you can make it fun. Bring in dancing, music, jokes, be fun and all kinds of fun stuff.

All these things also make you charming as people want to be with you.

You have to be honest, bleeding your heart out, say the honest truth of who you are (eg. even if you are not a great person, lonely, scared to death).

You have to bare your soul, not pull any punches, be authentically you. Do not pretend to be better or more talented than you are, just be raw. Then when other people cry, you will cry and have a real human connection that is not scary and it feels good. Then people will be good to you.


Steve Martin said of his stand up act.

“When I first started, I decided to fake confidence, because I thought it was important that they sensed I believed. If I was slightest bit nervous about something they could smell it and then they would become judges. If I was the slightest bit nervous about something they could smell it, and they would be

But if I was confident, it’s like “I don’t care what you think.” That worked “I don’t care what you think.”

Lots of energy for the audience

You have to have lots of energy for the audience, it’s what people want.

Before your performance, make sure you have lots of energy and have it to give and put into things

To have lots of energy, relax, dance, sing whatever you have to do to energize yourself and be happy.

Being passionate about it is contagious

Joe Rogan says he’ll watch somebody doing all kinds of subjects if they’re passionate about it as that is contagious.

It’s great to watch people who are interested in things, fascinated and in love with what they’re doing.

People who are smiling with their whole face about something.

If you love the subject and what you are doing

As always, love is the answer.

If you love what you’re doing, and the subject, then people will be interested and love watching it.

If you massively love it, then people will love it even more and want to watch what you are doing.

Be authentic and not fake.

You also have to be enthusiastic about things, if you are enthusiastic about what you’re talking about, other people will be as well. If you are interested in what you’re doing, other people will be as well. This is what makes the most engaging YouTubers and podcasters.

If you making content that you don’t care about. For example, just to make money, audiences can smell this authenticity. Audiences can tell when someone is not authentic.

It helps if you know you’re making content that you care about, you know it helps people you care about.

You also need to be fun, have fun in a way that other people enjoy that with you, be fun. People will even want to do what you do, because you’re fun.

The best way to get people to ignore you, is to be really boring.

Nuseir Yassin from Nas Daly

Be engaging.

Scream, smile, do whatever you can to get people to pay attention.

Are you enjoying it?

If you are enjoying it, other people will too.

You need to take care of yourself, so you can enjoy it.

If you’re not enjoying it, other people will be able to feel it and will not like watching you.

If you enjoy it, then you’ll think it’s all good and will like what you’re doing, so other people will as well.

You need to have fun, be interested in what you’re doing, and let it show.

If you are interested in what you are doing, other people will be as well.

Other things

You need to make yourself fun and enjoyable to watch.

People want to be happy, so you have to be really happy and people will want that. If you are on YouTube, then you have to be insanely or extremely happy.

You must have confidence in the content you’re delivering, for example don’t be like you are just filling time because you have nothing else to say.

It has to be fun, an event, a party.

You also have to be relatable, so people can see their own lives in you, they relate to you and feel how similar you are to them.

You say something and they think it’s funny and relate to it, because it’s something they do as well. Like getting hungry and raiding the fridge at 3am, eating food that is unhealthy and you shouldn’t be eating.

Look into the lense, not the picture of yourself if there is one.

Be certain about things and not uncertain. If you are not certain on something, then be certain about your uncertainty. If you say something without certainty it sounds like a question and you don’t know what you are talking about.

Like you are speaking to a close personal friend

On YouTube you need to speak to the person like they’re your closest friend, so they really feel they are getting to know you and they like you.

You can’t speak like you’re talking to the thousands, hundreds thousands, or million viewers that there are. You need to speak like you’re talking to one person.

Practice talking to the camera like the person watching the video is your closest friend.

You don’t do it like you’re talking to a massive audience, you do it like you’re talking to an individual friend.

It’s the same when you are in front of a massive audience, you look at the people like you’re talking to a close personal friend.

Even if you are the best expert and know more than they do, never talk down to people. Treat people with love and respect and talk up to them.

Be relaxed on stage

Don’t be uncomfortable, embarrassing or awkward as it won’t be nice for the viewer. They would also think you’re unprofessional and not like watching you.

After doing lots of public speaking or YouTube videos, you’ll get used to doing it, will feel comfortable and not awkward.

Don’t be stressed on camera or with an audience audience. Be relaxed.

You have to make it look like it’s easy. This is because if you make it look hard, the audience cannot relax and enjoy themselves.


Don’t do things like you are seeking the audience’s approval of you. So don’t do things to get them to confirm their approval of you. A bit like when people look at you through the corner of their eye, to see if you thought something was funny.

If you don’t take yourself seriously, the audience will think they shouldn’t take you seriously. Then they think, why should they be listening to you. However you also have to balance that with not taking yourself too seriously, or won’t be engaging and fun too watch.

Don’t speak in monotone

Don’t speak in monotone, it makes it too boring to listen to your voice. You need to spice it up a bit. You need to be animated and interesting. You need to be varied with your voice tone and put interest into it.

For example, when you introducing something make it big as you’re saying that the thing that’s coming is big and amazing.

People are attracted to interesting things, such as when you hear someone shouting, you want to know what’s going on that’s causing the shouting. Being interesting attracts attention.

Do things intentionally

Don’t do non purposeful or unnecessary movement. Of course you need your hands to communicate, but most of the time when it is not purposeful or intentional, it’s not good.

You also need to be natural and not stiff like a board, it is natural to move around a bit and so on.

If someone on camera unconsciously just wanders off, such as looking away different directions, what they’re saying strays over the place and so on, it’s not engaging

Only move the video camera when it’s intentional or needed.

Speaking on camera

If someone asks you to speak to them, like you would on camera, they would see it as way too much for them.

A level 10 energy and excitement in front of the camera, appears like a 3 to the person watching it on their screen. So you really have to be amazingly excited to get that number up. You have to up the energy.

When doing a recording on YouTube, even if you feel you’re at an 8 energy, you’re probably at a 4

Some people find it hard when speaking to a camera, speaking like they would to a friend. That’s just because the camera is just a piece of electronics and they’re just looking into a camera lens. However, it’s what you have to do.

The way some people do it is even when they are recording to a camera, they’re thinking of the person like a friend who’s watching it.

How to get used to speaking to a camera

Carry the camera around and speak to it, do this in different places, including in public. This will get you out of your old habits.

It has to be personal

Laugh at yourself on camera, this is a good way to get people to like you as you are a real person who can laugh at themselves. It also gets you to loosen up. Read some jokes that you find funny, look into the camera lens and laugh, just so you get used to laughing on camera.

Film yourself in public where there are people around, this will help get you out of your fear of public speaking.

Watch raw unedited recordings of yourself, This will help you get over things about yourself that you may be uncomfortable with, such as your voice, how you look and so on. It’ll help you to start to like yourself and be able to see things from a more impartial perspective. It will also help you to get more familiar with yourself, on and off camera.


You have to have personality, this will help make you interesting.

For example, there is a woman who has a successful YouTube channel where the viewer is just coming shopping with her and things like that. People watch because the videos because the videos and her have personality and so are interesting.

If the videos in her were bland and boring, people wouldn’t watch them.

Find your authentic voice

Jack Dee the comedian was failing miserably, it was going to be his last performance as he was going to give up after it.

On that performance he had nothing to lose, he was just depressed on stage as that was the real him.

However people found that funny and it was him being the real him. As a result he found his authentic voice and was very successful.

Before that he had been performing like a positive game show host.

James Acaster the comedian wasn’t doing very well. He had thought he would do really well if he was the cool guy who is like the popular one at school.

However that wasn’t him and it was only when he became on stage the person who wasn’t quite so cool and popular that he became successful as he had found his authentic voice and became successful.

You will then find your audience and the people that like you.

If things are going well for you, people want to be part of what you are having

If you are happy, well and things are going well for you then people would like to be part of what you are having.

So if you are a street performer who is happy, things are going well for you and are having fun. People want to be part of that.

Even if it’s just an unknown person performing on the street, people will be drawn to that performer and performance.

It has to be personal

Whether it’s music, or talking to people, it’s the personal stuff that makes a unique and special. You personally may not be perfect, but there’s stuff there and it’s real.

Your personal view on the world, your take on things and how you are.

How you see the world that’s different from how others see the world.

To do this you have to really trust in yourself and push the boundaries.

When there is a successful song and other people try to just do the same thing, so they can be successful too. It isn’t great and doesn’t work so well because they aren’t making it personal, their own personal thing. The stuff just isn’t there.

Concentrating and relaxed at the same time

Rowan Atkinson says you have to be concentrating and relaxed on stage at the same time.

Concentrating so you can perform brilliantly, see the audience reaction and everything else. However if you do this without being relaxed, you will just be stiff.

You need to be relaxed so the audience can be relaxed and enjoy it.

If you are concentrating and relaxed on stage at the same time, it’s like you’re the master of time and space. You can see everything that’s going on and do everything, and the audience can enjoy it as well.

Don’t be flustered

If you are blinking a lot then you appear to be flustered, this makes you look weak and being flustered is not pleasant for the audience to look at.

If you don’t blink much then you look strong and are relaxing and calm and nice to listen to and watch.

These are all examples of things that make you look weak and ineffective so people don’t want to listen to you. Basically they are signs that you are flustered, best not to be flustered.

Be super relatable

You, what your content is about, what you talk about, and what you’re doing needs to be super relatable. By that I mean stuff they do, are and have their lives.

Why people get bullied

According to Joe Rogan:

The kids at school who get bullied are the ones who are worried about being attacked. Those kids get picked on because the bullies recognize that they can pick on those kids.

The bullies see this vulnerability.

With chickens it’s called the pecking order, when a chicken gets packed at by a dominant chicken, the other chickens come in and peck it that chicken as well. Those other chickens are often cowardly chickens.

It’s based on insecurity, fear and a deep concern from the other chickens that one day they’re going to be the one that gets pecked at.

So if bullies see someone who’s scared of offending someone, stepping out of line, or taking a chance, then the bullies come in and exploit that target.

Bullies tend to be people who are bored and don’t have a lot of hobbies.

How to be happy

Charlie Munger, the business partner of Warren Buffet says the following. I think it is clever because he says to do it you have to let go of negative feelings.

“You don’t have a lot of envy.

“You don’t have a lot of resentment.

“You don’t overspend your income.

“You stay cheerful in spite of your troubles.

“You deal with reliable people.

“And you do what you’re supposed to do.

“And all these simple rules work so well to make your life better. And they’re so trite.”

His prescription is logical, he says.

“Staying cheerful” is “a wise thing to do,” Munger told Quick, adding that in order to do so, you have to let go of negative feelings.

“And can you be cheerful when you’re absolutely mired in deep hatred and resentment? Of course you can’t. So why would you take it on?” Munger said.


It is easy to be used to adrenaline and excitement, this means you look for things that cause you that, or get bored when you don’t have them.

However these are things that cause you anxiety, fear and so on. You are basically looking for problems.

So look at things which bring you peace.

It is good to go and get things, but be careful that when you get them, you don’t throw them away as you are bored by them. All because you are addicted to, or in the habit of having adrenaline and excitement.

You need to value peace, as without peace you cannot be happy.

Yes it can be boring, but still value it.

Self love and self respect

To have a happy life, a person needs to have self-love and self-respect. It doesn’t matter having all these things from the outside, if you don’t have them on the inside.

To achieve this you have to have done good moral things, otherwise you will just hate yourself.

You have to be a good moral person for things to work out, if they don’t work out how can you respect yourself.

You also have to allow yourself to love and respect yourself.

Cheer yourself on like you would a football team

People put loads of effort into cheering on football teams, people they’ve never met, don’t know them, or care about them.

You also need to cheer on yourself like you would a football team. If you don’t do that you’ll unhappy.

You also have to celebrate yourself, celebrate your successes, and so on.

Being happy as a person

It’s very easy to think you’ll be happy if you have a certain possession or thing.

Such as you’ll be happy if you have a partner, children, a certain toy, object and so on.

However in the whole scheme of things, these things won’t get make you happy, it’s how you are as a person.

So you need to be happy as a person. It’s not about whether you have these things or not. You are happy and well as a person and not by being attached to things.

So you are happy as a person, not happy because you are attached to things.

Having what you need, not what you want

Wanting things makes you miserable, you are dissatisfied as you don’t have enough.

You need to be able to have enough, or you’ll never satisfied, you just want more.

So having what you need is good, such as you need food to live. However wanting things never makes you satisfied and there’s also the added problem of you are then worried about losing them.

Interestingly people who have a lot, often find that the happiest time of their life was when they lost all their money through maybe some financial misfort. When they had nothing they were actually happiest.

So a person may have lots of power, money and so on. Other people see them and think they’re happy, but actually they’re not. They’re just attached to these things and really wanting them.

Of course it’s good to have what you need, such as medical help, a safe home and so on. However the big difference is between need and want.

Having it for others

If you are happy, then other people will be happy too.

This is because the universe is one, so if you are happy it goes on to other people.

If you selfishly want to be happy, you won’t be happy because that’s just a dark hole of sucking and taking.

If you are happy for the sake of others, so you’re happiness is so that it goes to other people and they get it, then you will be given more more.

It’s like an endless virtuous circle of you being happy so others get it and so you get more. It’s not for you, it’s for others and so it passes and goes through you.

So the best way to be happy is to think about making other people happy.

The best way to feel good is thinking about making other people feel good.

If you are just thinking about yourself feeling good, it’s just a dark sucky path of selfishness that does not feel good.


People who desperately have to be with others, it’s often because they don’t want to face or be with themselves.

They don’t want to face the bad things they’ve done, so need to be looking at the outside world and others.

They may have such bad mental constructs that they put their negative energy into others which is why they need them around. They put their stress, worries, concern, and so on into others.

They may also not be very nice to themselves, they push themselves around and so on. For example if somebody came from a very ambitious upbringing, they might push themselves really hard to do things and not be nice to themselves.

To be ok being by yourself, you’ve got to be nice to yourself. Imagine how you treat others, and then think about if you treat yourself the same way.

The big one is to accept yourself and how you are.

The people who can be by themselves for long periods of time, are the people who have dated themselves. This means you see and learn about being with yourself, like you do when going on a date with someone and deciding if you want to be with that person.

They have faced themselves so they are fine with being in their own.

The people who have not faced themselves, have to face themselves when they are with themselves for long periods of time. They cannot cope with being by themselves for long periods of time.

The people who have dated themselves before and so been with themselves, can be alone for long periods of time as they have already faced themselves.

It does not matter if lots of people love you, if you don’t love yourself.

Think about how you would like others to be to you, and be like that to yourself. Be loving, kind, compassionate and so on.

Do not bully yourself to perform better and so on.

People often look at how they are to themselves, how they are to their subconscious. You also have to look at how your subconscious is to you, just like how when in a date, you look at how the person you are on the date with is to you

When things get difficult don’t be tough on yourself to push yourself harder, it makes it even harder to live with yourself and so you get even more lonely.

Some people who are lonely, it’s because they’re not nice to themselves. As a result they need other people to be nice to them. The answer is to love yourself and be nice to yourself. You have to capacity to heal yourself and be good to yourself.

Not cut off from others and yourself

In the same way that you can be in a room with lots of other people and still be alone, because psychologically you’re cut off them.

Maybe you’re scared so have your barriers up, are overly controlling to others, or other things that create barriers.

You can also be cut off from yourself and so feel alone, as you don’t have your own company. It can happen if you’ve been overly tough or controlling to yourself. You need to be soft and gentle to yourself to create a relationship with yourself.

Self worth

People who can’t cope with being by themselves, whether it’s being at home by themselves without the company of other people, having to be with friends all the time, or have to get into another romantic relationship. It’s because they don’t have any self-worth.

They need other people to validate them and show them that they’re okay. They need to have other people around to prove to themselves that they’re worthy. This is because by themselves they don’t have enough self-worth, to think they are worthy.

To not be lonely you have to be authentically yourself with others, otherwise they just have the fakeness which means you’re actually alone because it is not actually you with others.

If you can’t cope with being with yourself, how can you expect other people to also want to be with you?

There are people who can’t cope with being by themselves, it can be because they don’t like being with themselves.

They need the distractions and good energies of other people, because they can’t cope with their own and themselves.

However, how can you expect other people to want to be with you if you can’t be with yourself, because you don’t like yourself or feel comfortable with yourself.

So in the same way that you look at what’s needed for other people to want to be with you.

Have a look at what’s needed for you to want to be with you. This means you will look at your energies, thoughts, the things you say to yourself and so on.