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Wednesday, February 11, 2009

How to Make Money in Stocks Part 6

Take Your Profit

Is the best to learn to sell on the way up while your stock still advancing and looks strong to everyone else. By do that, you will avoid getting caught in 20% to 40% corrections which occur periodically. You never sell at the exact top, so stop says “Oh after I sold it moved higher!!”. The purpose you play stocks to get GAIN not GREEDYY. The old man saying is, “ Bulls make money and Bears make money, BUT PIGS DON’T.

Rothschild’s Stock Rule, never buy at the Bottom and always sell too soon.

Joe Kennedy Stock rule, The object is to get out while stock is up, before it has chance to break down. Once the price has risen into estimated normal or overvaluation areas, the amount held should be reduced steadily as quotations advance.

Jack Dreyfus Stock Rule. He only bought when the price broke into new high ground. He was also beating the pants off every one of his competitors that depended solely on fundamental analytical opinions and ignored the market behavior of stocks.

Jesse Livermore, His method is AVERAGING UP, or PYRAMIDING, when stock moved up after purchase.

Profit Loss Plan. Not pyramid more than 5% than buy point, and sell when it reach 20% from break out point. Take 20% profits when you have them (except with the most powerful of all stocks) and cut losses at 8%.