So you're started trading, you bought some positions with your online broker, you've set some reasonable stop-losses to protect your account and all of a sudden one of your positions move strongly in your favor ? so what do you do now? This my friend, is probably the hardest situation to deal with in trading the market ? believe it or not.
Do you take profits? Do you hold on for more profits? Do you take partial profits? There is no textbook answer to these questions as it depends on your trading objective. That's why you need to determine your objective BEFORE you start trading. No matter what you do, there will be regrets if you trade long enough. If you decide to take profits, there will be times when the market makes a huge move without you, if you decide to hold on for more profits, there will be times when you'll lose the profits you had. However, the important thing is that you decide on your objective and stick to it no matter what happens.
With that said, let's discuss some profit taking options that you might consider.
When you've bought your stock, option or commodity and then placed your stop, you must first try to prevent that position from losing money. We recommend that you move your stop right along with the price movement. In other words, if your stop is placed one point below your purchase price and your stock moves up one point, then we recommend you move your stop up to your purchase price. After doing this, you now have a scratch trade at the very least and the position poses virtually no risk to your account ? only "gap downs" at market opens can hurt you. And of course, the golden rule with using stops is that they can only be moved up and must NEVER be moved down.
Chuck Cox is a Technical Writer and Industrial Scientist by professional with a background in statistics. He has used mathematical and statistical methods to invest and trade in the stock, futures, and options markets. Chuck has owned various businesses and presently operates several websites. To learn more about trading the markets, visit his website, http://www.earncashathometoday.com/trading-stocks.htm
taxi o'hare Wisconsin Dells ..The big bad bear is stirring again. So far he... Read More
You should ignore analysts on TV, the radio, the newspaper... Read More
I mean it when I say that. While plastic silverware... Read More
Where is the beef? Or maybe it should be where... Read More
The stock market is very unstable at this time going... Read More
Being wrong is OK, but let's not carry it to... Read More
I feel that an investment strategy in the stock market... Read More
In November of 2000 when the NASDAQ was trading at... Read More
Stocks breakout from properly formed bases everyday but many investors... Read More
Regardless of the fact that the world's stock markets have... Read More
As an investor you will want to check out any... Read More
'Sector funds are too risky.' 'I doubled my money with... Read More
Today we are inundated with tons of information about the... Read More
Let's say you are interested in this one company. You... Read More
What does it take to be a stock trader? It... Read More
Economists know more about how the fragments of society work... Read More
Mutual funds were moderately successful in creating a presence in... Read More
Invest in the stock market for the RIGHT reason, using... Read More
Investing in long-term financial vehicles give you the most gains... Read More
On November 17 I bought 7 different mutual funds and... Read More
When you stand on the ocean shore and watch the... Read More
How many times has this happened to you? You're at... Read More
The trading method you employ to approach the stock market... Read More
I have been trading for several decades and was an... Read More
As an investor you will want to check out any... Read More
bmw rental chicago Ackley ..The Dow Theorycharles h. dowcharles h.... Read More
All stock trading and investing methods must deal with the... Read More
Are you paying any attention to your retirement savings? Do... Read More
Last time we looked at the real performance of the... Read More
Look back over the years and try to remember how... Read More
From the book 'The Stockopoly Plan' by the author Charles... Read More
Mutual funds are doing more and more to discourage investors... Read More
Professional stock options traders use the term lean to refer... Read More
If you're a normal human being, your need to feel... Read More
Over the past few months, several investment professionals have brought... Read More
Picture one of those clubs where only the real heavyweights... Read More
Stocks breakout from properly formed bases everyday but many investors... Read More
Being wrong is OK, but let's not carry it to... Read More
Investing in long-term financial vehicles give you the most gains... Read More
If you go to Haiti or other places in the... Read More
The Macedonian Stock Exchange (MSE) is not operating successfully. True,... Read More
What are you thinking when it comes to your no... Read More
Investors who exclusively use broadly diversified, no load mutual funds... Read More
The trash business in its efforts to cook their books... Read More
Carefully thinking through your goal as a trader is of... Read More
A stock market index is a statistical measure of changes... Read More
Unfortunately, most of you who are reading my column are... Read More
You remember (they show it on TV every year) the... Read More
(1) CHK stock price $16.74, NAV $32.5CHK is my favorite... Read More
This is the continuing story of our two imaginary traders,... Read More
Stocks & Mutual Fund |