How to Make Money in Stocks: A Winning System in Good Times or Bad [Paperback]

William J. O'Neil (Author, Preface)

Book Description

Publication Date: September 1, 1994

Following on the success of the previous edition, this revised text offers rational, well-documented guidance for anyone who wants to make smart investments - even people who have never owned stock before. It explains how to: make money reading the daily financial news pages; pick the best industry groups in the market; read charts like an expert to improve stock selection and timing; and reduce losses and mistakes. This edition features information which reflects changing conditions on Wall Street, including: the proven C-A-N S-L-I-M stock selection system, based on a 40-year study of the most successful stocks; practical advice about the investment process, from picking a broker to diversifying a portfolio; charts and examples from "Investor's Business Daily"; and applicable changes in financial regulations and practices since 1987.

Editorial Reviews

Amazon.com Review

From the school of unemotional investing comes the classic How to Make Money in Stocks, by Wall Street analyst and publisher William O'Neil. Readers new to securities will find it an excellent primer, one that relies on time-honored indicators such as quarterly earnings, market capitalization, and daily indexes. O'Neil's study of winning stocks stretches back to the 1960s, and he shares his insights here, describing what characterizes a growth stock, when to cut your losses (at 7 or 8 percent, no more), and how to spot a market top.

The techniques in How to Make Money in Stocks are hardly revolutionary, but therein lies their strength, as O'Neil claims his is "a winning system in good times or bad." Investors interested in Net stocks might be disappointed--the author's first rule is that a company must show a pattern of growing profits, which disqualifies many dot coms. (Try Rule Breakers, Rule Makers for a different take.) O'Neil's approach to stocks is, above all, rational, and he pays little heed to market hype.

Those new to investing would do well to read this book before embarking, and even more seasoned traders may find How to Make Money in Stocks a refreshing return to basics. Markets may swing bull and bear, but O'Neil promises to stand firm. --Demian McLean

From the Back Cover

The bestselling investment system­­updated to help you uncover the best stocks in today's market!

Since 1988, through every type of market, the bestselling How to Make Money in Stocks has shown over 1 million investors the secrets to building stock market wealth. Author William J. O'Neil's powerful CAN SLIM‘ investment modeling system­­based on an exhaustive study of the greatest stock market winners dating back to 1953­­is a straightforward, 7-step process for minimizing risk, maximizing return, and finding stocks that are poised to perform. In addition, this revised and updated third edition provides you with:

• Expanded coverage of Nasdaq and mutual fund investing
• Techniques for reading charts, trading on news, and more
• Strategies to avoid the 19 most common investor mistakes

Praise for previous editions ...

"The most useful stock market book in years."

­­Management Accounting

"In O'Neil's opinion, a stock isn't unlike a car or a set of golf clubs­­you have to pay for quality. A winning system."

­­Personal Investor

"A superb book, spelling out his investment strategies in plain English and O'Neilisms."

­­San Francisco Business

"His very good advice comprises a mixture of three parts common sense and one part technical knowledge."

­­The American Spectator

--This text refers to an out of print or unavailable edition of this title.

See all Editorial Reviews

Product Details

• Paperback: 272 pages
• Publisher: McGraw-Hill Companies; 2nd edition (September 1, 1994)
• Language: English
• ISBN-10: 0070480176
• ISBN-13: 978-0070480179
• Product Dimensions: 8.9 x 6 x 0.8 inches
• Shipping Weight: 1 pounds
• Average Customer Review: 4.1 out of 5 stars  See all reviews (226 customer reviews)
• Amazon Best Sellers Rank: #1,023,582 in Books (See Top 100 in Books)

More About the Author

William J. O'Neil is the founder and chairman of Investor's Business Daily. He also founded William O'Neil + Company, a leader in equity market information and data research for more than 400 major institutional money managers worldwide.

Customer Reviews

Most Helpful Customer Reviews

117 of 124 people found the following review helpful:

4.0 out of 5 stars Somewhat idealistic, but lots of good tools, March 23, 2002

By 

Tony Ursillo (Norwood, MA USA) - See all my reviews

This review is from: How to Make Money in Stocks: A Winning System in Good Times or Bad (Paperback)

I read this book about 10 years ago and generally gained a greater appreciation for buying healthy stocks. Make no mistake - this is a momentum strategy. But O'Neil has created a very specific formula and process for his style of momentum investing. I also learned a lot about technical analysis and some of the other elements that affect stock movements (sentiment, market psychology, etc.). And O'Neil spends a good deal of time telling you how to sell a stock, whether at a profit or a loss. I think this is perhaps the hardest part of investing, but after reading this book, you should have no excuse for letting a huge gain slip away or digging a huge hole for yourself. Above all, the book provides dozens of examples to support many of the techniques advocated in the book. One gripe I have is that when it comes to finding certain patterns in charts (head and shoulders, cup with handle, etc.), beauty can be in the eye of the investor - I wasn't always comfortable with what qualified as an acceptable pattern, and, of course, these "iffy" charts all demonstrate money-making stocks AFTER the fact. I also believe that there are other investment approaches that can yield good results, especially in a trending market like we have found ourselves in more recently. But on the whole, this book provides a wealth of information in a concise, well-supported manner. It definitely belongs in your investment library. A bonus is that the newspaper O'Neil founded, Investor's Business Daily, can provide an ongoing educational follow up to the book, so the approach you learn in the book will never become outdated. I read it regularly.

77 of 82 people found the following review helpful:

5.0 out of 5 stars THIS BOOK SHOULD OWNED BY ALL INVESTORS, January 30, 1999

By A Customer

This review is from: How to Make Money in Stocks: A Winning System in Good Times or Bad (Paperback)

I have read about a dozen books on how to invest in stocks. And I'm here to tell you, this is undoubtedly the best. The man has been there done it. Whatever mistakes you've made in buying and selling stocks, he's done it. And in this book, he is passing along his wisdom so that you can learn from his past mistakes and get on the road success. If you haven't been beating the market averages and making a lot of money in the last few years, then it's because you are not following William O'Neil's CANSLIM method. CANSLIM is an acronym that defines his trading principles. These principles are the active ingredients that make a stock rise. Take it from me, give up on your hit and miss approach to investing. Begin today on his sound and proven methods of investing and you'll soon be glad you did. Do you know anybody who have lost or is down more than 50% of their trading capital on a stock? I do. Many of my co-workers have ridden stocks down to over a 70% lost. Now they are stuck in a stock or stocks they can't afford to sell. And worst of all, they are stuck when the market averages are soaring to heights. (That's gotta hurt. I know. I've been there). O'Neil methods won't let this happen to you.

To be honest, I was a slow learner too. So,let me take you back a little bit. I first picked up this book in '92, read it, got excited but then went back to doing it my way. I picked it up again in '94, read it and made a note in the book that a company stock called DELL fit the profile of his CANSLIM methods, set the book down, forgot about it and went back to doing things my way. (Didn't buy DELL in '94) Finally, early last year of '98, I again picked up the book and read it. This time I saw a little note that I had written in the book in '94 about DELL and thought to myself 'why was I so stubborn' about 'doing it my way' that I missed out on so much valuable time and money. Since then, I've bought the stock and a few others that have catapuled my portfolio balance to over 200%. Now that feels real good.

Like me for the first time, you'll probably understand most of what he says in the book but you may not relate to what he says entirely until you've been practing or 'getting your feet wet' in the stock market for a little while. Since buying and selling stocks is not a perfect science but rather an art, you will need to go back and reread the book many times over while you're in the market before you'll truly 'get it'.

My only critism about his CANSLIM method is that he steers you towards buying stocks with a low number of floating shares which indicate small to mid cap stocks because he says these stocks have the greatest upside potential. I disagree because hitech stocks like Dell, Microsoft, AOL, and Cisco that have gone global can still grow very rapidly if not faster than some of the small guys.

Other than that, armed with this book and his Investors Business Daily, you'll be able to achieve the returns that you've always wanted.

143 of 159 people found the following review helpful:

4.0 out of 5 stars Great Book but true Novices Beware., September 25, 1999

By A Customer

This review is from: How to Make Money in Stocks: A Winning System in Good Times or Bad (Paperback)

This is a great book from a man who obviously knows investing from experience (he has been successful). The book describes investing in Value stocks (moderate to high price stocks in steady companies) using technical analysis.

Patterns of successful stocks in history are reviewed and a system for choosing winning stocks is explain using detailed company information and charts. If you don't like math or don't want to spend time weekly reviewing your investments, this book is probably not for you.

Ture novice investors (like myself) BEWARE. Mr O'Neil does not describe many of the basic concepts he discusses in his book. I found myself becoming frustrated in several chapters as he discussed terms like "price consolidation", "overhead supply","upside buypoint", "pivot point", etc. After reading the book, I went and bought a more basic book (The Neatest Little Guide...5 Stars) to help me as a true novice.

In summary, I am glad I purchased the book. I now understand the investing viewpoint from a Value/Technical investor as well as the patterns of past winning stocks.