passion7272 @passion7272: "Why Taking Profit is an..."

Bangladesh

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Why Taking Profit is an Art: When you buy a stock or cryptocurrency like $BTC (Bitcoin) do you consider when you will sell it? Let me tell you, 99% of retail investors never ask themselves this question. Whenever you buy and the stock achieves some gains, set a trailing stop-loss; if you don't know where to close the position. It could be 10%, 20%, or a maximum of 30%. Why? If you invested in $HIMS (Hims & Hers Health Inc) six months ago, chances are your gains were over 600% just a week ago. However, in the last seven days, the share price dropped by 50%. If you still hold the entire lot of shares, you must have lost 300% in gains. And it may drop further. But if you had set a trailing stop-loss at 15%, you could have saved a substantial amount of money. “Hold a little longer—what if it goes higher?” This greed can erode all your gains and may even cause the price to fall below your purchase price. For example, consider $NIO (Nio Inc.-ADR) If you bought this in 2020 at $5 and saw gains of over 1200% by 2021 but never sold, thinking it would increase another 1000%, you are now facing a loss. I’ve seen many investors still holding this stock with a 95% loss. "Buy the Dip" does not apply to all stocks. Some companies only rise in price due to hype and FOMO. When corrections occur, these companies may fall to levels they will not reach again for the next 100 years. Therefore, before buying a stock, it is crucial to understand the company's fundamentals. Take $APP (Applovin Corp) for example - it dropped over 18% yesterday. Next, $SEZL (Sezzle Inc) dropped over 13% yesterday. Both of these companies are fundamentally strong, but the market believes that their current valuations are incorrect. This could be a buying opportunity! On the other hand, $TSLA (Tesla Motors, Inc.) has dropped about 45% over the last three months. There is no doubt that Tesla is a good company, but before buying or dollar-cost averaging, you need to ask yourself why the company is experiencing this drop. Just check the last few income reports, and you will see it might deserve another 50% drop from here. "Not all dips are the same." Like a painter balancing colors, investors must balance risk and reward. Review your portfolio from time to time. Adjust stops as trends shift. Celebrate taking profits, it means you’ve won. Accept stopping losses, it means you’ll live to trade another day. In the end, the art of profit and loss isn’t about perfection. It’s about progress. Start today: set your stops, mute the noise, and let the market reward your discipline.