InvestorGeeks

So the other day, the big sell off started. And it’s arguable that it’s just beginning. Spurred on by Phil’s post, I considered selling out of everything.

It made sense: I thought everything was going down, so I should sell.

But it also didn’t make sense. One thing I’ve pointed out before is my struggles with trading/investing using so many different strategies. It’s easy to mix them up. That’s why when I make an entry, I need to know what my exit is… and stick to it.

The clearest no-no, which I avoided, is selling a position that is meant to be a long term investment based on short term fluxuations and technical indicators. In the short term, this is costing me hundreds of dollars. But in the long term, it’s easing my mind, easier to execute, and I think a profitable play (since I don’t expect to be a great market timer - at this scale).

My IRA positions in a few mutual and index funds is meant to be held until I retire. I only sell them when I’m taking profits. I can switch funds, but this should be based on some material change in the funds or a change in my asset allocation plans. I do not sell these funds, I merely add to them on technical dips. These were the rules I setup when I entered those positions.

So instead of selling those holdings, I’m holding. And things aren’t even bad enough for me to add to them yet (according to my preset plans on when to add to the positions). Though I wish I had some more cash on hand to do that when the time comes.

So I just wanted to throw this out there. If you are, like me, trading several different strategies, be sure to keep from mixing things up. Know what your plan is when you go into a trade and how you plan to get out.

It worked pretty well for GRMN, even though I sold at $81 earlier and am missing out some nice action today. $81 is above my sticker price for that stock and so it’s out of my MOS zone. And the indicators I’m following triggered a sell (a whipsaw, but a sell nonetheless) and so I sold for a nice 40% gain.

I didn’t follow these rules with BBBY, which I’m down 5.64% now. The stock didn’t actually fit any of my strategies when I bought it. I bought it kind of fast, on impulse, and way too soon. I didn’t know when I was going to sell (especially towards the downside) and so I have to figure it out as I go. Not a good position to be in. Not because I’ll necessarily trade worse (some people trade really well this way), but I am much more emotionally involved in this than I would have been if I had a plan going in. And so it’s taxing that way.

Good luck everyone. Some crazy times behind and ahead. Should be a lot of good opportunities for making money and learning.