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Strategies & Market Trends : Your Worst Trading Enemy.. You -- Ignore unavailable to you. Want to Upgrade?

To: shawnwolff who wrote (36)	1/16/2001 12:52:11 PM
From: Fun-da-Mental#1	Read Replies (1) \| Respond to of 223

Sure, hindsight is 20-20. Maybe it sounded like I was saying "I wish I had held the stocks that did well and sold the stocks that did badly." What I meant was I picked more winners than losers, and yet I managed to lose money because I felt a stronger attachment to the losers than the winners. That's why I would have done better just to hold everything. That would have saved me from my two main mistakes: bailing on winners and averaging down on losers. Of course this is not the best possible strategy, but it's better than what I was doing. Another way to put it is that my thinking is clearest BEFORE I enter a trade. Once I am holding I become emotionally involved, so I need to be skeptical about the thoughts that come into my head then, and not react right away. Of course I still should respond to new developments, but not get caught up in a spiral of second-guessing. The time I was losing the most was when I was trading the most. (I am speaking as a long-term trader. Maybe for daytraders it is different.) Also, I'd like to say something more about my state of mind when I was losing. A lot of people talk about the pain of losing money, but I had the opposite problem. I didn't feel pain. I didn't take it seriously enough. I preferred to tell myself it would be okay and forget about it. This just enabled me to dig myself deeper. I don't know but I imagine this is probably how a gambler feels while he's blowing his life's savings at a casino. Fun-da-Mental

To: shawnwolff who wrote (36)	1/16/2001 1:45:36 PM
From: davidrmm	Read Replies (1) \| Respond to of 223

I am not a day trader but am trying to figure out how to lock in profits instead of riding down. I am in a learning phase and play with money I can afford to lose. Somewhere I came across a comment that we are our worse enemy and our biggest danger is not limiting the loss potential. There are always opportunities to buy, but as is coming across in this thread we tend to hold on through losses and profits. It boils down to greed I guess. I took three stocks that were rebounding WCOM, ORCL, TSM, the past two weeks and did what I think you say you do and follow with a stop loss so when it sells at least there is profit. With WCOM and ORCL I sold only 30 to 50 % of my positions. (I am in a self training mode and want to see what happens) I am trying to target an average gain of 20 % but that is after I see the stock move in a positive direction. I have not set stock losses on any other stocks at present. Is the recommendation to set stop losses on all holdings? Even if at a loss at this point in time? (Own worse enemy statement.) My holdings are not large usually $ 2000 to $ 8000 for each position. I look for profitable companies with PE f 40 or less although on occasion I might get into a CISCO or AMGEN at higher PE. I appreciate this thread and hope to learn a lot. I still wonder if long time holdings in Good long time mutual funds which show consistent earnings do as well in the long run. That approach allows time to research new technology & try to find the new Intel, Compaq, or Cisco. Then you put in some gambling money. Even then however the stop loss is a good strategy. The above is written to say this is what I am doing but I am looking for advice of experience as to whether I am headed in the right direction or should I stay in long term buy and hold.