With success, bank some profits

If the fundamentals continue to look good and are supported by a favourable price trend, do not take profits.

However, if you are doing particularly well, you should cut winning positions to keep a balance in your portfolio and take cash out of the market.

There have been some very high-profile billionaires who have gone completely bust. They probably took a lot of risks to get there, which were too bold for most people. Why didn't they just put a lazy hundred million on the side, in case it all went horribly wrong?

Here is a sensible way to lock-in some wins.

Value all of your positions on the basis of the current market price. This process ignores your original entry price, and any other price along the way, such as a high or a low.

If your investments are going really well, you may find that their mark-to-market value significantly exceeds the original risk amount you had in mind.

As an example, say you, allocated 20% of your assets to trading, and the positions have done so well that on a mark-to-market basis, they are now worth 40% of your total assets. Here you should probably reduce your positions and bank some profits. This would even be regardless of supportive fundamentals and a trend in your favour.

Over the years there were times when an investor or trader reduced positions which were doing well and which looked good going forward. Those decisions had nothing to do with their views on their fundamentals, but were simply to take cash out of the market.