Replies to post #1134 on MMStockPlay''s Money Makers

[Bob-C]

Hi Serael and Trader34, sell on exit strategy...

Disclaimer, none of my comments are to be used for or are intended for trading or investment advice. My comments are for educational sharing; do your own DD and consult your financial advisor; I am not a financial advisor.

Guten tag Serael, good to hear from you, I hope that everything is going well for you. Thanks for your excellent question. :)

I posted the following to TRADER34:

...It is imperative to have an exit strategy before making any trade or investment. The exit strategy can be modified as the stock or other type of investment goes up or down.

It is absolutely imperative to have a goal, a plan on how to carry out your investment or trading goal, and to execute your plan for every trade and/or investment that you make. Plan your trades and trade your plans. :) I never listen to Wall Street jargon that it's a new era or it's different this time. It's never a new era or different this time. It's always fear and greed that the PTB prey upon and use to make their profits. Wall Street always loves to recommend stocks at their highs after they're already loaded up. The word "sell" is an anathema on Wall Stret. When and if they do recommend a sell for a particular stock you are already broke and busted in that stock.

Note, the same fear and greed ruined investors way back in the times when the "South Sea" debacle and the "Tulip Mania" debacle took place.

I sold AAPT based on my exit strategy. All traders and investors must have an exit strategy as part of the plan they use in the decision-making process to determine when to buy or sell a stock, option, bond, or any type of position. The trader and investor must establish an exit strategy for selling their position or positions before entering (buying) those positions. Failure to establish exit strategies can and often will lead to eventual significant losses and/or financial ruin for most investors and traders.

At the time I sold AAPT the AAPT TA was already deteriorating, e.g., the daily Fast and Slow STOs and the MACD were crossing below their signal lines on both the daily and weekly charts. However, even if the TA still looked OK on AAPT I would have sold at least half of my AAPT position which would have covered my initial costs and would have give me a profit in addition to making the remaining half of my shares essentially free since I covered my costs. :)

Note, the exit strategy must also take into account when to sell if a trade or investment goes wrong and losses start to increase. Never ride an investment into the ground based on the "slope of hope" every time there is a DCAT bounce in the security on its way down to lower prices. That DCAT bounce is the dump-out bounce by the PTB that fools investors and traders into believing that "it's turning around" and that "this time it wil be different." That's what the investors in ATRN and similar stocks thought; the smart investors took their extensive gains while the others watched all the way down the slope of hope as ATRN deteriorated badly. Note, I'm not commparing ATRN to any security I'm only using it as one example out of many.

I haven't sold and I don't sell any position simply based on deteriorating TA and/or FA but rather I take my profits and run. :) I don't speculate on how much more profit I will or can make especially when I already have a good profit. :) Return of one's money is always the primary goal and return on money is the secondary goal. Never let them take your profits away expecially the majority or all of your profits away. Don't give your hard-earned profits back to them. I don't wait until I have a 100% or far more profit before I sell a position; I sell when it is necessary to protect my profits or to stop my losses. You must determine what you can afford to lose and what you think is a reasonable profit goal before youe enter any trade to buy and/or sell a security as part of your plan and exit strategy.

I said I used TA to TRADER34 for my sale of AAPT because I wanted to point out that even though I felt that AAPT had good long-term prospects it had no effect on my decision to take my hard-earned profits and exit my risk-on trade. :) Failure to take profits is one of the worst mistakes that a trader or investor can make. In the crash of 1929, 1987, and the financial disaster of 2008-2009 many long-term "buy-and-hold" investors were wiped out and were never able to regain their losses. They rode the "slope of hope" all the way into the ground incurring steep losses and bankruptcy in many cases. Many mortgaged and/or refinanced their homes and ran up extensive debt on their charge cards just so they could buy those great stocks that were going to make them rich. It's never different; history repeats over and over especially greed and fear in worldwide stock markets; the author Mark Twain (1835-1910) wtote,

"It is not worth while to try to keep history from repeating itself, for man's character will always make the preventing of the repetitions impossible." (Mark Twain in Eruption: Hitherto Unpublished Pages About Men and Events, edited by Bernard DeVoto, 1940.)[source: Wikipedia.]

That quote by Mark Twain has been restated and attributed to Mark Twain as "History does not repeat itself, but it does rhyme."

The buck always stops and should stop with the investor and/or trader as to when to buy or sell a security. Never depend on someone else to decide for you when to buy or sell a security. After considering all sources of information and doing your own due diligence the decision to buy or sell a security rests solely with you. that's what it should be and that's what free will and freedom is all about, the freedom to make your own choice and not have it made for you. :) I choose freedom and free will. :)

Have a happy and successful trading day and week.

Best,

Bob