It says it all in the title. I am noticing that some of you are getting into a stock and it happens to not go as planned. The stock starts to fall, it is normal for this to happen every once in a while when you did a bad entry BUT you can protect yourself by keeping losses to a minimum.
I see some of you coming to me when you are already down 30%- 40% when I see this I know the trade was done emotionally. WHICH IS OK. We all make that mistake when we are learning, but it is VERY important to recognize this. IMO you should only be letting it get to 8% MAYBE 11% down before you have to call it quits, take the loss like a trader and move on to the next stock that could recover it. But when you get emotionally involved because all your thinking is what would happen if you were able to hit that price target you wanted?
For example, some of you own 15,000 shares of NVCN, and you want so bad to get to $1 – the odds of this happening is not very good without a reverse split. This is just an example. You have to think realistically. Yes rockets are fun to ride, but realistically would be a 10% profit and out. If it zooms faster by all means let it ride but holding too long can cause serious financial issues.
PLAN YOUR TRADE.
Before you enter the stock already tell yourself the rules. No matter what if you get to X% then you have to sell for profit, but if it drops to X% you have to sell for the loss. I have sold sometimes when it was only a 6% loss just because I felt it was not gaining momentum like I thought it would. You have to be mentally prepared to take a loss to protect your money. Hope and wishing is not a form of protecting. Rules & Guidelines you set are a proper form of protection in your trade.
I am no real blogger so I apologize for any misspellings etc.