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TitleHow I Trade and Invest in Stocks and Bonds - Wyckoff
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Total Pages228
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Page 2

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BOUGHTWITH THE INCOMEOF THE

SAGEENDOWMENTFUND
THE GIFT OF

HENRYW. SAGE
1891

Page 114

98 HOWI TRADEAND INVEST
much rather buy it than some stock which was
still in the range of distribution after being

marked up 40 or 50 points and made very ac-
tive around the top. These are but simple

examples of a study of the action of different

stocks and some of my reasons for choos-
ing one rather than the other after giving

due weight to all the other factors in the

case.

It is strange how people will continue to ig-
nore the important elements just referred to.

Probably it is because they do not understand

the operations that underlie the fluctuations in

securities and which are responsible for many
of their movements. I refer to the campaigns
mapped out and carried out by pools consisting
of groups of a few or many men who look far
ahead and observe the approach of a situation
which will enable them to buy or sell to ad-
vantage.

As Charles H. Dowused to say: "The pub-
lic rarely sees values until they are pointed
out,"— which means that the public does not
lead, but is led in speculation. It rarely acts
until it is told to act, or until action of some

Page 115

SUCCESSFULINVESTING 99

sort is suggested by a bit of verbal information,
a market letter, etc.

But there is another kind of suggestion which
is the most potent in its influence on the pub-
lic, and that is the action of the market it-
self. A rising price for a stock suggests still
higher prices and declining quotations bear the
inference that prices are 'going lower. Pools

work on this weakness, which is due to igno-
rance on the part of the public. They accumu-
late a stock without advancing its price; then,

when market conditions are favorable, they
bid the stock up. This excites public buying,

because people always want to get in on some-

thing that is "going up." Vice versa, groups

will often try to depress a stock, counting on

the public's support when the issue begins to
decline.

It long ago occurred to me that success in
the security market demanded an understand-
ing of the operations of those who were most
influential, because these interests had been

studying the business and operating in the

market for many years and were therefore
experts. It was sound reasoning to suppose

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