Buy Like A Fool, Sell Like A Pro

There are 4 scenarios that keep repeating during investment decision making, as below:

1. Buy Like A Fool, Sell Like A Fool.
2.  Buy Like A Pro, Sell Like A Fool.
3. Buy Like A Pro, Sell Like A Pro.
4. Buy Like A Fool, Sell Like A Pro.

So which method that you keep using?

Basically, Buy decision making got 2 types:

1. Buy when the price near your estimated the best entry price or the entry price. (Pro)
2. Buy when your felt comfortable after there is a bullish signal. (Fool)

When come to Sell decision making got 4 types:

1. Sell when the price reached or exceeded your target price (Pro)
2. Sell when the price failed to reach your target price with profit or breakeven. (Pro)
3. Sell when the price failed to reach your target price with predetermined exit point. (Pro)
4. Sell when the price failed to reach your target price with no planning. (Fool) 

After go through above scenarios and methods, what’s your choice now?

The best choice will be scenario 3 and 4, right?

Sometimes, we might missed the best entry price but it doesn’t means that we not going to earn money from the trade.

Example:

Airasia on 26/08/2015, the lowest price is RM0.765 then next day close at 0.885.

So will you buy Airasia if you know it will come to RM1.25 by 11/09/2015?

Definitely yes!

However, we are no god, we only can predict the price and follow the trend.

So would you forgo the 36.5sen in profit after you miss the best entry point and decided not buy at 0.885?

Think about this example whenever you spot an opportunity but you miss the best entry price.

Above example is intention to tell you that, we are not necessary to buy like a Pro but can buy like Fool.We can buy without a good planning or strategy but we need to sell like a Pro.

How many people losing huge money because of not having a good strategy to sell their share?

It should be majority of people having this kind of problems, only minorities that keep on track wining overall don’t have this kind of problems. By having a good sell strategies, help you secure you profit and save your capital.

Example:

Counter that drop fast and steeply:

Sumatec (on 21/08/2014) and Ideal (19/08/2014), these 2 counters bull at the way then dropped steeply in one day within few minutes.

Counter that drop slow and steady:

Knm (since Aug 2014) , Skpetro (since April 2014) and UMWOG (since Feb 2014), these 3 counters after bull then drop slowly.

Thanks for your reading.

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