dy and hold on for a big
profit. Read Chapter XXIV. on the "Possibilities of Profit."

_PART THREE_

INFLUENCES AFFECTING STOCK PRICES

CHAPTER X.

MOVEMENTS IN STOCK PRICES

It is due to the fact that stock prices constantly move up or down that
speculation is possible. Sometimes certain stocks remain almost at a
standstill for a long period of time, but at least a part of the stocks
listed on the Exchanges move either up or down. If one always could tell
just what way they were going to move, it would be comparatively easy to
make a fortune within a short time.

In the last twenty years, a great deal of time and money has been spent
by statistical organizations in checking up statistics for the purpose
of ascertaining a definite basis upon which to predict future movements
in stock prices. Several of these organizations use very different
statistics upon which to base their conclusions, and yet their
conclusions are very similar. They have proved beyond any question of
doubt that some of these movements are clearly indicated by laws that
never fail.

We do not attempt in this book to explain the fundamental statistics
upon which the predictions of business cycles are based, but in the next
five chapters we explain some of the influences that affect the
movements in stock prices. Read these chapters very carefully, for your
success in stock speculation will depend very largely upon your correct
prediction of these movements.

CHAPTER XI.

MAJOR MOVEMENTS IN PRICES

Stock prices move up and down in cycles. These are the major movements
in prices, but there may be many minor movements up and down within the
major movements. These stock price movements nearly always precede a
change in business conditions; that is, an upward movement in stock
prices is an indication that business conditions are going to improve,
and a downward movement in stock prices is an indication that business
conditions are going to get worse.

At the present writing, we are in a period of improvement. Stock prices
began to go up in August, 1921. The upward movement has been slow, but
gradual. In a period of seven months, forty representative stocks show
an upward movement of about 20 points, although business has not shown
much improvement. A steady upward movement in stock prices is a sure
sign that business conditions are beginning to improve, even though that
improvement is not noticeable.

These major st