1. Don't try and catch a falling knife industrial stock for at least 18 months after initial fall.
2. Don't get sucked in by a high dividend.
3. Don't buy a stock where the div is financed by debt (any fool could loan money from a bank and pay themselves a dividend out of it.)
4. Don't be comforted but be suspicious of underlying motivations when multiple Directors buy falling knife stocks.
5. Stay clear of very large companies that appear to be losing market share as they will most likely continue losing it to leaner, hungrier competitors.
6. Set a stop loss upon purchase and act on it, unless you like bleeding dollars rather than blood.
Likely there are a few more lessons as well that don't spring to mind at the moment.
regards.
