Stop Losing in Stocks

Pretend you own a fruit stand.  You bring in the finest apples and your wealthier, healthier clients buy half of them making you some money.  Unfortunately, no one else wants to buy them.  Do you stubbornly hold on to the aging apples until they rot or do you lower your price?  Would you sell them at a loss?

You need to think the same about your stock investments.  No matter how good you are you will never create a zero risk investment plan that earns any worthwhile returns.  Part of you stock plan needs to be a way to determine when your stock trade has gone bad so you can bail out.  I suggest you make your exit automatic by using a planned stop-loss when you enter your trade.

If you want to make money in the stock market you’ll have to plan ahead.