Investors often commit a mistake while exiting from the trade. They do know when to enter but miserably fail to get away with a margin. So what are the best exit strategies? Here are some highlighted which might bring fortune to you:
The moment when number of buy reports is high & media shows only the positive side about a company, it's time to sell. Sometimes companies invest huge on their branding and marketing programs to garnish the fund from investors but it's just a trap. The possibility of downfall becomes stronger at this moment and if it's not now it can be too late to empty your basket.
It has been observed, stocks having the best performance for a while, may most certainly fall in the near future and hence it's a sign to exit wisely. A stock that has moved up already will eventually fall - Law of regression to mean enforced !
The increasing risk of debt is another top indicator when it's time to exit. A company with high debt rate ratio will underperform soon. Higher the debt, higher the possibility of breakdown so sense this situation and be wise enough.
Waiting for too long towards recovery may cost you huge so make a right decision to dump the stock at the right time. Sometimes Investors keep a hope of recovery until it's vanished completely but it's important to understand, there are several stocks listed on exchange and opportunities are huge.
Last but not the least, Stop loss orders are another good exit strategy that can be used very effectively. The automatic closure to trade position not only facilitates when market is choppy but also minimizes the loss.
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