Five laws of the stock sold Money Tips

Category: Money tips Release Date: 2006-05-21

Sold a rule: 7-8% lower than the purchase price determined stop-loss?

The first and most important one for many investors to sell in terms of the rules is very difficult. After all, for many people to recognize our own mistakes is more difficult. Investments of the most important is that when you make mistakes when the error and will be quickly recognized that the loss to a minimum, which is 7% stop-loss rules of the causes. Through the study found that 40% of the large Niugu often end up in the back after the outbreak of the initial flashpoint. The same study also found that the critical point and fell 7-8% of the stock future, a better opportunity to show less. Investors should be careful not to only see a small number of stocks rose after the crash example. In the long term, sustained losses to a minimum within the investment would be to obtain better returns. Therefore, the bottom line is to the purchase price fell below 7-8%, to sell the stock! Do not worry about making mistakes when you take a small loss, when you do not make mistakes, you will get more compensation. Of course, the use of stop-loss rules It should be noted: buy point should be a crucial point and the investors buying the stock when you buy point to determine flash point, although the benefit of hindsight is not necessarily buying point flashpoint.

Ask Rule 2: sell the stock after the climax

There are many ways to judge a Niugu will have peaked and dropped to a reasonable price, one of the most common method is to determine when the market investors are trying to kill all the time ownership of the shares. A stock gradually rose 100% or even more later, suddenly accelerated rise, stock prices rose 25-50% within 1-2 weeks, from the graphical point of view is almost vertical rise. This situation is not very exciting? However, shareholders should be aware of rejoicing, I: The throws stocks. The stock has entered the so-called high tide zone. Shares continued to rise in general is difficult, because no one wants to buy the more expensive. Suddenly, the huge demand for the Unit became a huge sell-off. Based on the past 10 years Niugu study, the stock fell after the climax, it is difficult at the back to the original cake, if they can come back also requires 3-5 years.

Ask Rule 3: Continuous Su Liang hit a high point of time to sell?

The stock price is determined by supply and demand. When a stock when the stock began to rise significantly, its volume is often a lot higher. The reason is that institutional investors scramble to buy stock ahead of ahead of its competitors. Over a longer period of rise, the shares rose power failure. Shares will continue to hit new highs, but the volume begin to decline. Have to be careful this time, and this time, few institutional investors are willing to re-buy the stock, the supply began to exceed demand, the final sell-off is growing. Increase often precedes a series of Su Liang reversal.

Ask Rule 4: profit 20 percent after the end not all of the shares will continue to rise, and many growth investors tend to sell shares after the stock rose 20 percent. If you can throw 20% of the shares at a profit in the 7% stop loss, then you invest four times to one time would not suffer a loss. For this rule O'Neill gives an exception, he noted that if the stock price after the outbreak of points, within 1-3 weeks up 20%, do not sell, hold at least 8 weeks. In his view, such a rapid rise in share price the stock has increased by 100-200% of the kinetic energy, it needs to hold a longer time to share more revenue.

Ask Rule 5: When a stock break through the latest platform, failed to sell the stock, everyone knows that spring, summer autumn and winter seasons, large Niugu trend is also similar cycle. These stocks experiencing a rapid rise and build a platform alternating. In general, the longer the time to build a platform, then the greater the increase in stock prices. But it also exists the possibility of stock prices peaked, the share price may fall sharply. Typically, when the stock reached its peak earnings and sales growth is very good, because stock prices reflect the future. Undoubtedly, the stock will slow down the rapid growth in the company before the peak. When there is a large negative news, if the message is expected to result in failure of the latest platform to build, investors should sell the stock quickly.