Solving Problems BEFORE They Become Big Problems

 

Question:  Hi James. When is the best time to get out of a bad trade?  I’m currently sitting on a loss and am wondering if I should just wait things out or cut my losses and move on.

Thanks,

Teri

 

Answer:  Without knowing more specifics about your ‘bad’ trade it’s hard to make that call.  However, one of the toughest things for an investor to do is to sell a losing trade when you “just feel” it will make a comeback.

What normally happens is you end up watching the stock go down even further and you definitely don’t want to sell then because your ego is at stake.

Rest assured, the Markets Don’t Care About You Feelings.  So, when your ego gets in the way it can be a very expensive lesson.

Far too often, investors allow their problems to get worse before taking action.

The way around that dilemma is you need to learn how to solve your problems before they become big problems.

It’s easier said than done.  But first if you don’t adopt the right mindset, you’ll end up making the same mistakes over and over again.

Here’s two simple yet profound mindsets that you must put in play BEFORE investing.

 

• Take your emotion out of the trade.
• Monitor and question your decisions as to what can go wrong with this particular trade.

 

You see, a trader is normally NOT a buy and hold investor.  That’s why they’re called “traders,” DUUUHHHH!

There are many more advanced strategies to hedge your bet such as:

 

• Writing covered calls
• Buying puts
• Selling puts
• Putting on straddles
• Putting on spreads

 

But they’re not for average investor.

In our monthly “Short and Sweet Tips” column we show you how to use simple investment strategies to improve your winning percentages.

The August issue features ways to limit your losses while simultaneously protecting your profits.

We assure you they’ll come in handy during Turbulent Times.

Get your copy (HERE).

 

The market will bail me out

 

 

 

Question:  Hi James. When is the best time to get out of a bad trade?  I’m currently sitting on a loss and am wondering if I should just wait things out or cut my losses and move on.

Thanks,

Teri

 

Answer:  Without knowing more specifics about your ‘bad’ trade it’s hard to make that call.  However, one of the toughest things for an investor to do is to sell a losing trade when you “just feel” it will make a comeback.

What normally happens is you end up watching the stock go down even further and you definitely don’t want to sell then because your ego is at stake.

Rest assured, the Markets Don’t Care About You Feelings.  So, when your ego gets in the way it can be a very expensive lesson.

Far too often, investors allow their problems to get worse before taking action.

The way around that dilemma is you need to learn how to solve your problems before they become big problems.

It’s easier said than done.  But first if you don’t adopt the right mindset, you’ll end up making the same mistakes over and over again.

Here’s two simple yet profound mindsets that you must put in play BEFORE investing.

 

• Take your emotion out of the trade.
• Monitor and question your decisions as to what can go wrong with this particular trade.

 

You see, a trader is normally NOT a buy and hold investor.  That’s why they’re called “traders,” DUUUHHHH!

There are many more advanced strategies to hedge your bet such as:

 

• Writing covered calls
• Buying puts
• Selling puts
• Putting on straddles
• Putting on spreads

 

But they’re not for average investor.

In our monthly “Short and Sweet Tips” column we show you how to use simple investment strategies to improve your winning percentages.

The August issue features ways to limit your losses while simultaneously protecting your profits.

We assure you they’ll come in handy during Turbulent Times.

Get your copy (HERE).

 

The market will bail me out