Bob Farrell’s 10 Market Rules

I was reading David Rosenberg's daily letter (outdated, but I'm still playing catch up here...) when he mentioned Bob Farrell and his ten rules:
For those who are not familiar with Bob Farrell, he was the dean of Merrill Lynch research for four decades, I was fortunate to have had him as a mentor, and his 10 market rules to remember are now 30 years old and they have been a cornerstone of my strategy since I first joined Merrill in 2000 and I still abide by these rules today; they have not gone out of fashion.
Since I didn't know about them, I just HAD to find more.

So here are the 10 rules as found via Google:
  1. Markets tend to return to the mean over time.
  2. Excesses in one direction will lead to an opposite excess in the other direction.
  3. There are no new eras — excesses are never permanent.
  4. Exponential rapidly rising or falling markets usually go further than you think, but they do not correct by going sideways.
  5. The public buys the most at the top and the least at the bottom.
  6. Fear and greed are stronger than long-term resolve.
  7. Markets are strongest when they are broad and weakest when they narrow to a handful of blue chip names.
  8. Bear markets have three stages — sharp down — reflexive rebound —a drawn-out fundamental downtrend.
  9. When all the experts and forecasts agree – something else is going to happen...
  10. Bull markets are more fun than bear markets...

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