and early out, being contented with a cut off the loaf and pass it on; for it is the profits missed that ruin the speculator. [Sidenote: SHORT PERIODS IN AND LONG ONES OUT.] There is scarcely a more important point to which to draw attention, than that of being contented to watch for an opportunity. It is fatal to the success of a speculator to be always with stock open in the markets. The casual observer must be well aware[36] that now and again a small panic occurs, and the general level of values is knocked down perhaps two, three, or on serious occasions as much as four per cent., according to the inflated state of particular stocks at the time. A speculator who has twenty or thirty thousand pounds nominal of stock open at such a time, stands in a moment to lose eight or twelve hundred pounds at a blow. With such a contingency always hanging over him, it must be evident to the prudent man that in order not to expose himself more than he can possibly help to such a catastrophe, which may happen at any moment, he should operate, be contented with a moderate profit, and close.[37] The obvious advantage of looking on for comparatively long periods, and having commitments for short periods is, that the chances will be much more in favour of the speculator when a panic causes a heavy fall. He is then free to buy at prices which are sure to be unduly depressed, and instead of the dreary waiting to recover from losses incurred, he makes in a very short time probably a handsome profit, again retiring to avoid the reaction that follows a sharp recovery, to await a similar favourable opportunity. To be overtaken, with large amounts of stock open for the rise, by a panic which engulphs a speculator’s money and upsets his judgment at the same time, is among the least excusable faults when committed by the man who starts upon any system. The haphazard speculator is almost sure to have accounts open when a panic takes place, because he is, as a rule, in a fever lest he shall miss a rise, and is, therefore, never contented unless he is “in the swim,” and hence the severe handling he gets by never seeing the cataract until he is half way to the bottom. CHAPTER VIII. SPECULATION WITH CAPITAL. [Sidenote: RESTORING THE BALANCE OF ADVANTAGES.]