The selling stage is when profits or losses are determined. Buying sets the purchase price of how much you will gain or lose, but selling guarantees the gain or loss.
Example: Say you buy 10 shares of XYZ at a price of $10. XYZ goes up 20% to $12 and your equity increases by $20 (# of shares x change in price), but you do not realize (profit) the $20 until you sell.
The biggest reason people have trouble selling is because of greed; they want more and more and more gains. Greed and emotion turns profits into losses. Learning how to properly sell helps ensure the preservations of gains and reduces the likelihood of incurring huge losses.
Limit and Stop Orders reduce your loss exposure. A Limit Order is an order that sets the maximum and minimum at which you are willing to buy or sell. A Stop Order is an order to buy or sell once the price reaches a specified price.
Never attempt to time the market. Your goal is to buy at one price, and sell at a higher price.
My name is Camden Alchanati and my goal is to teach you how to create a future of financial stability and growth!