Make Gradual Sells

The market is just as unpredictable when it comes to choosing the right time to sell as it is when choosing the right time to buy.

As with buying stock, you will need to have a strategy to sell.  Why making gradual sells maybe preferred?

If you move everything out because you're afraid of losing it all, how will you feel if the stock recovers to your buy price and then pushes beyond?  If the stock doubles after you buy it and you sell everything, how will you feel when it becomes one of the legendary ten-baggers?  In both cases, you'll feel terrible.  I know because I have been there.  

Gradual moves into and out of positions take some of the pressure off because everything doesn't need to happen just right for you to make money.  Things can be a little fuzzy on the buy and sell.  As long as you are making gradual moves, you'll be fine.

Combining gradual moves is a good way to reduce investment stress.

Let's assume you own 2,000 shares of Company ABC.

• A couple of reasons to sell have been met based on your research, but the company has just opened a new distribution center that you didn't know about when you first bought. You're not sure if that's enough reason to hold on.  The stock is trading for $30 - three times what you paid for it.  You feel comfortable taking that kind of profit now, but something about that new distribution center has you thinking the stock will go higher still.
• If you sell nothing, you're going to blow a vessel if ABC drops to $12 a share.  If you sell everything, you're going to blow a vessel if it rises to $40 a share, or even $32.  So you compromise on both the sell price and the amount you're going to sell.  You placed a good till cancelled limit order to sell 1,000 shares at $32.  Then you go hiking, or golfing, or swimming, or take a run.  
• Three weeks  later while you are not paying any attention, ABC hits $32 and your broker sells 1,000 shares.  Now, no matter where the stock goes you can take comfort in your interim profits.  If the price begins to drop, you will consider selling the remaining shares, or buying additional shares with the money you just made at $32.  If the price rises, you'll make even more profit on your remaining shares.