I will share with you one of my trading secrets.
Look at this chart.
Then look at this chart.
Did you notice anything?
One gave you close to a 200 percent gain and the other one gave you 4 percent gain.
The question now is how will you know which stock dapat mo e hold to give you good gains at which one naman dapat mo e benta to avoid gains turning into losses.
This is where my secret comes in. IT’S THE APPROACH!
I always enter a trade on a short-term approach/mindset.
I enter a trade expecting that trade to be a short-term trade UNTIL PROVEN OTHERWISE.
Kapag bumili ako ng isang stock ang expectation ko lagi ay short-term lang until mismong si stock ang magprove sakin na e long-term siya or di siya e benta.
Most traders when they buy a stock it looks like this.
They buy sa bottom then expect the stock to go far up or to go back sa dati nitong price.
This is how they usually do it. The stock was at 30 pesos a year ago and ngayon nasa 5 pesos na lang. They buy at 5 pesos. They get a calculator. They calculate their “earnings/profit” if bumalik ang stock price sa 30 pesos. They sit there with a smile on their faces. They think about the gadgets or the things they could buy with those profits. “A trip to HK? Maybe a new Iphone….hmmmm?”
The stock went up to 6 pesos and they smile a little bit more thinking “I’m so good… go on..give me my expected profit” or “HOLD lang byaheng langit toh!”
Then the stock goes back down to 5 pesos then to 4 pesos then 3 then 2. All of a sudden they are holding a stock that has a close to 80% loss.
This is how I approach a trade.
I buy a stock. I always think na short-term trade lang. The stock goes up. I don’t sell pero ang mindset ko is bebenta ko kapag nahit sell signal ko. I don’t go and get a calculator para e calculate ang “profit ko” kapag naging ganito o ganyan ang hawak ko. I don’t look at where the stocks’ price was at dati. I just look at my sell signal to see if na hit na and keep my expectation na short-term lang to na trade.
The world is full of uncertainties – disease outbreaks, the threat of nuclear war, hyper-partisanship and divisiveness, mounting debt, anemic savings rates, a healthcare system on the brink. Not a single Pinoy a decade ago thought that TEL would lose 70% of its value but look where TEL is now.
The next time you trade isipin ninyo ang sinabe ko. Enter a trade expecting that trade to be a short-term trade UNTIL PROVEN OTHERWISE.
That is going to be your edge.
Throw away that calculator and that “ano gagawin ko sa kita ko if umangat ang stock ko sa ganitong level” na thought. Hindi mo need yan. Maraming time magcalculate after mo mabenta ang stock mo.
BTW, 20k na tayo sa Trader’s Lounge!!!
That is right! 20K Members na ang TL!
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