Does anyone have a good rule of thumb to sell a stock?
You hear lots of ideas about buying stocks or trusts. I want to know how to figure out when to dump a loser that still is paying a steady stream of dividends or cash out on a winner that is a non-dividend bearing stock
- Ron BerueLv 61 decade agoFavorite Answer
There are several schools of thought:
1] Before getting into any trade, the trader/investor should plan the trade - "from cradle to grave".
A] the entry: Among other criteria: checking the news; finding out when earnings are; finding out about stock splits; what the market, sector, industry and the stock's trends are. THEN when the rules are acceptable. planning an entry price.
B] the target or goal.
C] the price when it hurts too much to stay in any longer.
D] An acceptable loss % OR dollar amount
E] Regardless of what the stock is doing - going up, going down or moving sideays - a specific time period to get out and go on to other trading opportunities.
As one of my mentors told me, "Trees don't grow to Heaven - neither do stocks or any other type of investment.
2] "Shoot from the hip" and rely on "stock tips" from friends, relatives and strangers.
3] Asking Qs of those more knowledgeable - preferably your broker - about the market and that particular stock.
Yes, that is my real last name!Source(s): Thanks for asking your Q! I enjoyed answering it! My wonderful family! My wonderful coaches and mentors! TWO  of THE ABSOLUTE BEST, MOST wonderful trading groups in the world, which I am most proud to be a member of! Trading stocks and options more than 2 years. "THE University of Hard Knocks"
- singlegalLv 71 decade ago
Read everything you can find concerning the stocks you want to buy or sell. Hopefully the stocks are companies whose products you use regularly.... Oil companies will not go out of business soon so those are generally keepers. If you are losing sleep over a stock one way or the other....get rid of it. If you need the money you are investing or thinking about investing..... don't invest in the stock market. You have to have the mind set that you can afford to lose the money that you have invested. If you can't.....don't.
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- abinaLv 44 years ago
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