How to Become Rich According to Mark Minervini

[Henrik Ekenberg]

How to Become Rich According to Mark Minervini
Mark Minervini, a highly successful trader, has developed a philosophy on wealth-building that extends beyond trading. His approach emphasizes a disciplined, long-term commitment to excellence, knowledge, and strategic financial management. Here's a breakdown of Minervini's advice for those seeking to build wealth and achieve financial independence.


1. Go Where the Money Is
Minervini chose Wall Street for its limitless earning potential. His key takeaway is to pursue a career or field that aligns with your financial goals and offers ample growth opportunities, such as finance, technology, or real estate.

Example in Practice:
In the 2000s, Minervini focused on high-growth tech stocks, aligning with the booming technology industry. By working in a field that offered high returns, he capitalized on massive gains, which would have been harder to achieve in a low-growth field.

2. Focus on Being the Best, Not on Money
Minervini emphasizes striving for excellence rather than obsessing over income. When you concentrate on mastering your craft, financial success often follows naturally as a by-product of your skill.

Example in Practice:
Steve Jobs, co-founder of Apple, exemplified this approach by focusing on creating innovative, high-quality products rather than solely on profit.

3. The Path to Wealth: Knowledge, Experience, Skill, Money
Minervini advocates a step-by-step path: Acquire Knowledge, Gain Experience, Develop Skill, and then Earn Money. Financial success follows once you achieve a high level of expertise.

Example in Practice:
In the early 1990s, Minervini dedicated years to studying market patterns and refining his trading strategy, eventually developing the skill to capitalize on his insights.

4. Think in Decades, Not Years
Minervini advises thinking in terms of decades instead of years. Wealth-building requires patience, as people tend to overestimate short-term achievements but underestimate the power of sustained effort over time.

Example in Practice:
Warren Buffett became one of the world's wealthiest individuals through decades of investing, benefiting from compounding gains over time.

5. Leverage Yourself
Expand your reach beyond your immediate capabilities. Minervini recommends using platforms like social media, blogs, and books to reach a broader audience, opening up additional income streams.

Example in Practice:
In 2013, Minervini published his book Trade Like a Stock Market Wizard, expanding his income opportunities through speaking engagements, courses, and coaching.

6. Live Modestly Until You're Financially Secure
Minervini emphasizes living below your means until you achieve financial security. Keeping expenses low allows you to reinvest earnings and accelerate wealth accumulation.

Example in Practice:
Early in his career, Minervini reinvested his profits instead of splurging on luxuries, which helped him build his capital base faster.

7. The 10% Rule for Depreciable Assets
Minervini limits spending on depreciable assets, like cars and luxury goods, to no more than 10% of his net worth. This discipline focuses spending on appreciating assets that build wealth.

Example in Practice:
Instead of buying a luxury car early on, Minervini invested in appreciating assets, directing more capital toward his investments.

8. Only Lend What You're Willing to Give Away
To avoid conflicts with friends and family over unpaid debts, Minervini's rule is to only lend what you're comfortable considering a gift.

Example in Practice:
Minervini once lent an amount he was comfortable considering a gift to a friend, preventing tension when repayment took longer than expected.

9. Always Seek Favorable Odds in Business and Investments
Minervini's investment philosophy centers on finding opportunities with favorable risk-to-reward ratios, maximizing potential returns while minimizing risks.

Example in Practice:
In 2018, Minervini achieved significant returns by focusing on stocks with favorable risk-to-reward setups.

10. Treat Savings as Untouchable
Minervini treats his savings as "at zero," meaning they're untouchable except in emergencies. This discipline preserves capital for long-term goals.

Example in Practice:
When faced with unexpected expenses, Minervini avoided dipping into his savings, preserving a financial cushion.


Final Thoughts: Discipline, Patience, and Strategic Thinking
Mark Minervini's wealth-building philosophy is rooted in discipline, patience, and strategic financial management. By focusing on self-improvement, pursuing excellence, and maintaining strict financial discipline, you set yourself on a path toward financial success. Minervini's principles show that wealth is the result of sustained effort, strategic thinking, and a long-term commitment to your goals. With discipline, patience, and a commitment to excellence, you can apply Minervini's approach to build wealth and achieve financial independence.