Sometimes buying early on the way down looks like being wrong, but it isn't.

Great investments don't just knock on the door and say "buy me".

To achieve long-term success over many financial market and economic cycles, observing a few rules is not enough. Too many things change too quickly in the investment world for that approach to succeed. It is necessary instead to understand the rationale behind the rules in order to appreciate why they work when they do and don't when they don't.

The near absence of bargains works as a reverse indicator for us. When we find there is little worth buying, there is probably much worth selling.

When excesses such as lax lending standards become widespread and persist for some time, people are lulled into a false sense of security, creating an even more dangerous situation. In some cases, excesses migrate beyond regional or national borders, raising the ante for investors and governments. These excesses will eventually end, triggering a crisis at least in proportion to the degree of the excesses. Correlations between asset classes may be surprisingly high when leverage rapidly unwinds.

Hold cash when opportunities are not presenting themselves.

Generally, the greater the stigma or revulsion, the better the bargain.