Digesting The Profits

Interacting with lot  fellow investors, I have came to know that most of our friends are suffering from indigestion. Don't get me wrong its not the one you are thinking about its about digestion of profits.
Most of the friends as soon as they see a 10% rise in a stock they get tempted to sell it, they want to get their profits fast in spite the fact that the stock has got excellent fundamentals and excellent technical and has great potential of further up-move they sell it with small rises. On the other hand if it falls even by 30% they keep holding it in hopes that it will rise back again.

I want you people to change it. You are not here to earn 10-15% quick gains you are here to make big and multiply your capital in the long run. Your are here to create wealth and not money. According to me you should never sell a rising scrip and never hold a falling one. Let the profits increase and the losses diminish. Shift you stop losses with rises so that in case the rising one start falling you are booked out and you don't end up giving what you have got back to the market. Yes you need to do with caution don't keep your stop losses too close or you will get sold out with minor corrections. It should be kept slightly below the previous support. Put stop losses as soon as you buy a scrip and let it get sold out if it falls below stop loss and don't behave as you expected.

To be a successful investor you have learn to ride your winners, no one has ever created real wealth by short term hit and run or by booking at every 10-15% rise. Warren buffed rode his investments for 20-25 years and he is still riding them. I don't want to you to hold for that long period but atleast give a scrip 3-6 months time to show it true colors to perform as per your desires. You have to learn the art of riding your winners. You have to learn how to digest profits.

 If  you do that you will be cutting your losing ones and riding your winners and the results are Gains, Gains and Gains!! and Wealth! Wealth! and Wealth!

Happy Investing

Abhishek Ninaniya
The Stock King
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November 30, 2014 at 11:14 AM delete

bro what is ur view on spicejet with recent block purchase frm jhunjunwala....any entry suggested at cmp?