Always have an exit strategy in place for every investment from "summary" of Stock Investing For Dummies by Paul Mladjenovic
It's crucial to always be prepared for the unexpected when it comes to investments. You can't predict the future, so having an exit strategy in place for every investment is a smart move. This strategy allows you to protect your investment and minimize potential losses if things don't go as planned. One way to approach this is to set a specific price at which you'll sell your investment if it reaches that point. This is known as a stop-loss order, and it helps you avoid holding onto a declining investment for too long. By setting a predetermined exit point, you can prevent emotions from clouding your judgment and making rash decisions. Another approach is to have a time-based exit strategy. This means setting a specific timeframe for how long you're willing to hold onto an investment. If the investment hasn't performed as expected within that timeframe, it may be time to cut your losses and move on to other opportunities. It's important to remember that having an exit strategy doesn't mean you're giving up on an investment too soon. It's about being proactive and protecting your capital in case things don't go as planned. By having a plan in place, you can make more informed decisions and avoid letting fear or greed drive your actions.- Having an exit strategy in place for every investment is about being prepared for any outcome. It's a way to safeguard your capital and ensure that you're making decisions based on logic and reason rather than emotion. So, before you make any investment, take the time to consider your exit strategy and be ready for whatever the market throws your way.
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