You'd think they'd know better by now...
Many investors don't believe in the merits of planning ahead, but that's a huge mistake in today's highly volatile markets for two reasons:
- You miss 100% of the swings you never take.
- You won't ever be in front of rapid market moves.
For instance, I often recommend a 25% trailing stop as a means of guarding against unexpected market moves, protecting profits, and guarding against losses.
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It's something I do as a matter of practice on all our recommendations because studies show that protective stops not only help you capture bigger winners over time, but also keep you in the game confidently when conditions get dicey...
And conditions certainly fit that description now.
Let me tell you about a textbook situation we encountered recently. It's a story that could save and make you a lot of money before this selling is over...
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Take Expensive Guesswork Out of the Equation
Lots of investors think they'll wait "until" the heat of the moment to do their selling, but that's never a good idea.
Why?
Simply because stocks that hit their stops do so for a reason. Then, more often than not, they keep going.
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That's the case with a recent cloud computing recommendation in High Velocity Profits.
It was trading at $64.34 and down 2.06% on the day. Our recommended stop - give or take a few cents - should have been triggered at or near $65.91, based on how we recorded the entry when the alert got sent.
Anyway, without belaboring the point, readers following along with the full recommendation, including the stop, got the chance to close out for a tidy 15.93% profit... versus a 1% loss from the S&P 500 over the same time frame.
By the way, most online trading platforms, including those provided by the major brokerage firms, have trailing stops built into them - so there's really no excuse for "flying blind." Contact your broker if you're unsure how to use them... or if you simply want to use them more effectively.
In closing, I think we're in for a rocky few months based on current trading conditions and the tremendous cross-currents raging through the headlines... China, politics, Brexit, etc.
Don't let those sway you.
Our research is very clear (and very profitable) on this point: The best companies will continue to attract capital even under adverse market conditions, and velocity will show you the ideal time to make your move for maximum profit potential.
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About the Author
Keith is a seasoned market analyst and professional trader with more than 37 years of global experience. He is one of very few experts to correctly see both the dot.bomb crisis and the ongoing financial crisis coming ahead of time - and one of even fewer to help millions of investors around the world successfully navigate them both. Forbes hailed him as a "Market Visionary." He is a regular on FOX Business News and Yahoo! Finance, and his observations have been featured in Bloomberg, The Wall Street Journal, WIRED, and MarketWatch. Keith previously led The Money Map Report, Money Map's flagship newsletter, as Chief Investment Strategist, from 20007 to 2020. Keith holds a BS in management and finance from Skidmore College and an MS in international finance (with a focus on Japanese business science) from Chaminade University. He regularly travels the world in search of investment opportunities others don't yet see or understand.