Paper profit does not equates to real profits
it is important to set a price target and take the win without being ambitious or emotional. Some stocks may plummet after rally for days.
Many people hold stocks for long term and don’t care about paper loss. After holding it for months or even years , it may become profit eventually. Similarly paper profits may become loss if you hold for long.
Hence, as we diversify and buy different stocks, we should set a target price (profit and loss). Once it hit the target (profit), we will have to sell it. For stocks that went down, we can consider to hold first and DCA if the fundamentals and moat are strong. If need to, sell it fast to prevent further loss. Sometimes playing the long game may be a good choice, but we need to have the capital and patience to play it.
Many people hold stocks for long term and don’t care about paper loss. After holding it for months or even years , it may become profit eventually. Similarly paper profits may become loss if you hold for long.
Hence, as we diversify and buy different stocks, we should set a target price (profit and loss). Once it hit the target (profit), we will have to sell it. For stocks that went down, we can consider to hold first and DCA if the fundamentals and moat are strong. If need to, sell it fast to prevent further loss. Sometimes playing the long game may be a good choice, but we need to have the capital and patience to play it.
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