"Don't fire until you see the whites of their eyes."

Most Americans were taught in school that William Prescott, commander of the colonial forces on Bunker Hill, gave this order to his men on the morning of June 17, 1775, just before the British attacked them.

Some may even remember that while the British took the hills, they did so at such great cost, it wasn't much of a victory. The American forces repelled the British twice and were finally overwhelmed when they ran out of ammunition - an outcome that obviously concerned Prescott and provoked his order to conserve ammunition. It was vital to use each shot as effectively as possible.

I think of this often when contemplating investing, because I sometimes feel an urge to get all of my investment cash deployed NOW. I might miss the next big uptick! And even if not, modest double-digit gains are still better than money sitting in the bank. This urge gets strong when the market gets hot, as it has been over the past months - look at all the gains I missed!

But the best speculations, as Doug Casey likes to remind us, are when the perfect pitch comes sailing across home plate, cheap and with great upside. There are no called strikes, so it only makes sense to wait and swing only when it'd be hard to miss, hard to get hurt, and there's clear out-of-the-ballpark potential.

Key Point: Missing out on a winning pick may wound pride, but it doesn't cost any cash. Placing hasty bets can cost dearly on both accounts.

Or, as Doug also likes to say, you can't kiss all the girls. Nor should you try; the consequences in real life of attempting to kiss every girl you meet would be... nasty, brutish, and short.

Returning to my original metaphor, I don't want to pull the trigger on a deal until I see the whites of their eyes - i.e., until everything is lined up for maximum effectiveness. Or, as I've put it before: "Buy Low, Sell High" is a much better strategy than "Buy High, Sell Higher."

Strategy vs. Tactics for Speculators

Speaking of military metaphors, I frequently refer to strategy and tactics in my writing. Last June, I gave a talk on strategy vs. tactics at the Cambridge House conference in Vancouver, explaining in greater detail how these concepts can be useful to speculators. With gold recently reaching almost $1,400, making the blood pound heavily in so many speculators' veins, I think it's a good time to spell those thoughts out, lest any of us get carried away and suffer a lapse of discipline.

First, it helps to understand that these terms are not interchangeable. The U.S. military defines strategy as being:

The art and science of employing the armed forces of a nation to secure the objectives of national policy by the application of force or the threat of force.

Tactics, on the other hand, are defined along these lines:

The military science that deals with securing objectives set by strategy, especially the technique of deploying and directing troops, ships, and aircraft in effective maneuvers against an enemy.

My way of summarizing these ideas:

• Strategy: What you want to do. This might be "divide and conquer" or "overwhelm with vastly superior force" in a military context. For investors, it might be "preserve wealth" or "raise max cash ASAP."

• Tactics: How you do it. This could be something like, "build a giant wooden rabbit and use it to sneak troops inside the castle walls" in a military context. For investors, it could be something like "pick only safe, undervalued investments" or "speculate on the stocks with the highest upside potential available."

Why you do it, of course, is your goal. That might be conquest or freedom, for armed forces, and financial independence or "drop dead money" for investors.

Key Point: Know Thyself. This is one of the things I've learned through thousands of interactions with investors over the years: your strategy and tactics - the "what" and "how" of your plan - should be based on what you are actually capable of doing.

For example:

• If you know that you are temperamentally unsuited to speculating on highly volatile stocks that can easily lose 50% before paying you back 500%, that's not a tactic you should employ. If you just can't tolerate being in the red for no good reason, admit it, face it, and plan accordingly. Otherwise, nothing is worth the heartache you'll be stepping into.

• If you are not a qualified investor, you can't build a strategy on emphasizing private placements with attractive warrants.

• If you don't understand the technicalities of trading in options, don't even go there.

This may sound like an overly philosophical approach to giving investment advice, but I firmly believe that one size does not fit all. If you're to have any hope of sticking with your strategy when the tactical realities you face are rough, you've got to know that you are capable of executing your plan. "Know thyself."

Strategies to Consider

What's the best strategy for you? As above, one size does not fit all, but here are some broad ideas for you to consider:

• Preserve Wealth: If you are on a fixed income or simply know that you have a very low tolerance for risk, the rather bold tactics the International Speculator specializes in are probably not for you, so I won't dwell on it. Casey's BIG GOLD publication, focused on the best of the larger, more stable gold (and silver) producers should be able to offer you plenty of guidance that will work better for you.

• Hold to the Top: If you want to earn a lot of money but don't have the time or temperament to trade actively, buying the best of the best and holding them to the top of the market may be your best approach. Don't worry about when any given pick might take off, or if it seems fully valued at present, or unlikely to exhibit explosive growth going forward. Only make portfolio adjustments when necessary.

• Play Volatility: Look for stocks that exhibit frequent and large swings in share price, then buy low and sell high, over and over, as opportunity allows. Or look for stocks that have gotten ridiculously cheap (perhaps even for good reason, but have become way oversold) and then buy them to ride the rebound. Or look for stocks that have soared beyond all reason and are likely to correct, and then short them (note that this is a high-risk approach; when shorting, you need to be right about which way a stock is going and when it will move).

• Build Carefully: This requires a lot of patience. You don't worry about how long it takes you to deploy your cash, you simply sit and wait for opportunities that look as close to "can't lose" as you can get. You always recover your initial investment at first opportunity and redeploy as above with extreme caution. No whims or larks allowed.

• Doug's Strategy: This is one way Doug likes to play the juniors: deploy your cash into as many stocks as you can, as long as they are really cheap, seem sound (8 Ps), and have a lot of upside. If you can bet with money you can afford to lose, don't be too picky, but don't bother if there's no home-run potential. A single ten-bagger can make up for nine duds, so if you can do any better than that, you come out way ahead.

Some of these ideas can be mixed and matched, some not. There are many more possibilities and variations. The important thing is to sit down with these ideas and a fresh cup of coffee one morning, or do whatever you need to do to carve out some quiet time when your mind is the most creative and energetic.

State your goal to yourself - it's very important to have a goal you can actually write down in words. Be specific; a financial goal should include a specific money target.

Then decide what strategy among those you are capable of implementing best achieves your goal. Your strategy should evolve with changing market conditions, but only you can determine what the basic approach is that will work for you in achieving your goal.

It's very important to have a plan to follow - with a strategy you can articulate and tactics you know you can execute. Such clarity is a huge benefit to investors, especially that bold breed that's willing to call themselves speculators. It's the backbone that helps us stand firm as contrarians, and buy when everyone else is selling (low) and sell when everyone else is buying (high).

And remember to hold your fire until you see the whites of their eyes!

No one is better than Louis at devising strategies for investing in precious metals juniors - strategies that have enormously benefitted the subscribers of Casey's International Speculator. It's no coincidence that in 2009 every single stock he picked was a winner... for an average portfolio gain of 75.5%. And just in the first half of 2010, subscribers locked in gains of 110.4%... 128.8%... even 266.1%. You can it now risk-free for 3 full months - or your money back. Details here.