Successful traders know that a simpleton's "buy low, sell high" methodology almost always results in buying on the way up, and selling on the way down, antithetically buying high and selling low, because predicting tops and bottoms can be very tricky business.
Cramer taught me to accumulate in batches, never all at once, starting small and increasing in position as the deal sweetens on the way down; and in exit strategy, do the opposite, sell in batches of increasing size as the price goes up.
This strategy accepts that no trader or system's triggers will be on target picking the peak or valley (with predictable frequency), and seeks to average out entry/exit points in the general vicinity instead. "Bulls make money; bears make money; pigs get slaughtered" is one of Cramer's memorable sayings in which I find comfort when I fail to optimize such a situation. You have to stick to discipline, and believe in your model; don't let emotions affect your timing.
Of course, buying when the stock is falling, or selling as it rockets, is lonely and can be scary. Hey, nobody said this stuff is for the masses.
What do you think of Google's descent?
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