My portfolio is back to break even after being up 12% -- then losing it all and more in 8 days of huge losses.
So a fresh beginning. That's okay. Especially if I've learned from my mistakes.
Taking profits is part of the game. Sure, the stocks I own should be much much higher, but the market cycles and will regularly selloff after extended runs... consolidate, run some more. Not taking profits when they come fast and furious is foolish. Making money is easy... keeping profits is not.
I will be much more observant of charts going forward... using them to make occasional sells when they get extended. What works with value stocks is simple: sell when they are the must-own exciting names... buy them when they are being tossed in the garbage heap.
To succeed, it is critical to do the very opposite of normal human behavior. Good times should bring on fear and concern of loss. Huge drops should be welcomed and embraced. And always keep proper position size and cash balance to take advantage.
You can make money in the larger swings... but you must have the patience to hold, the ability to let go too early, and not fear the panic lows that bring the most opportunity.
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