Buy shares, sell them
If we talk about one mistake of investing in stocks, it is inevitable that investors can't “sell” if they don't forget to sell, they sell at the wrong time. Or there is greed, for example, intending to sell at the price of 10 baht, but when the price reaches the target that has been set, he changes his mind because he is confident that the price will continue to rise. If it's as expected, it's probably nothing. But if the price reverses down The intended goal may fail.
Joseph Kennedy, father of former President John F. Kennedy, a Wall Street investor, said: “Failed investors hope that they will sell their shares. can be obtained when the price has risen to the highest point. Successful investors will sell their shares when the stock price is going up.”
This means that if the shares are sold at the right price and time Investors get a return on their investment and reduce their chances of losing. And the important factor that investors should consider selling shares is
1. get 3 lose 1
William J. O'Neil, a former marketer-turned-investor and top-ranked success. One of the worlds has its own "stock sell" rule that follows a 3-to-1 ratio between Take Profit and Stop Loss, that is, if you make a profit of 20% - 50%. sell it for a profit But if that stock price drops 7% - 8%, then sell to cut losses immediately. Because assuming that if investors choose the right stock, make a profit in the level of 20% - 50%, get 3-4 times, it means almost 100% profit or more. Likewise, if there is a mistake and sell it, cut losses quickly, it will only be damaged. a little
For example, buy ABC stock at 8 baht and set a target that if it makes a profit of 20% or increases to 9.60 baht, it will sell for profit, but if it doesn't go as expected, the share price has dropped by 7%. or adjusted down to 7.44 baht, will sell and cut losses
2. Bear market. Don't be greedy.
In a bear market (Bear Market), the stock market continued to decline. As a result, profitability will not be high. At the same time, there is a chance of increasing losses, so the profit target must be reduced. For example, if it makes a profit of 10% - 15%, it will sell immediately, but if it goes the wrong way, it will cut its loss when the share price drops by 3%.
For example, buy ABC stock at 8 baht, set a target that if you make a profit of 10% or adjust up to 8.80 baht, you will sell it for profit, but if it doesn't go as expected Is the share price dropped by 3% or dropped to 7.76 baht, will sell to cut losses immediately.
3. Reach the target, sell quickly.
“Sell when the price hits the target” is a good investor's rule of thumb. That is, when the share price has entered the frame of the estimated target price, the shares should be sold. because it shows that the stock is fully worth it And from now on, there is a chance to see the price drop.
Target price is the highest price analysts expect a company's stock to reach within the next one year, calculated from the company's data, such as earnings projections. profitability Historical history of stock prices Financial ratios such as P/E Ratio, P/BV Ratio
4. Basic change
Most often occur with long-term investments such as buy and hold for 3 years, 5 years, 8 years, etc. This group of investors aims to receive dividends that the company pays regularly. However, if the company has fundamentals. changes such as industrial stagnation competition intensifies As a result, sales decreased. Executives came out to admit that earnings may be a loss. Investors need to assess whether it affects the fundamental value of the company or not. And if it is found that it may affect the ability to pay dividends, it must be decided to sell.
5. The price runs fast.
Seeing the stock price surge without fundamental support should consider selling out Because naturally, when the stock price rises rapidly in this manner. Soon the price will also drop sharply. Of course, it is impossible to estimate when the price will go down, so the best strategy is Setting up a selling point to cut losses
6. Decreased transparency
Such cases often occur with senior executives who have the decision-making powers of the company, for example, in the past the company was recognized as trustworthy. There is transparency in the disclosure of information. But one fine day, the auditor reported that the company had refurbished the account. And the executives came out to admit that it was true. If this happens, investors must sell their shares immediately, for example.
Therefore, it is undeniable that successful investors In addition to buying shares An essential step that is indispensable is the sale of shares, because it is the point of deciding whether there will be a profit or loss.
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