One of the drawbacks of investing in equities is that you must have money immobilized for a more or less dense period of time. Depending on the deadlines to those who are addressed. With a decrease in the balance of your checking account since you will have more problems to assume some of the planned expenses in your budget. For example, pay for your vacations, buy a state-of-the-art computer or take a professional course. Although the most worrying thing is how to face unexpected expenses or even those derived from any pending debt with your financial institution.
This is one of the risks you run if you invest all your assets in the stock market. Faced with this situation, the most advisable scenario is based on leaving a savings bag in the checking account to effectively meet these needs. But especially, through a rational strategy that does not prevent you from facing the most unfavorable situations for your domestic economy. Because at the end of the day they are scenarios that you must surely anticipate in advance. Because the repercussions can be very negative for your personal interests.
Next we are going to expose you a series of scenarios that at some point or another may arise. So that you know what you should do at all times from now on. Not surprisingly, they are performances with which you have certainly gone through on more than one occasion. Where you have even been able to leave a lot of euros on the way. To avoid these incidents, it is highly advisable to be clear about the actions that you have to apply at all times. It is not a matter of improvising in each of your operations. But on the contrary that you have everything planned so as not to have any scares from now on.
How to maintain liquidity?
It is always very beneficial to have liquidity in your checking account. To make payments and maintain your level from day to day. From this general approach, the first step lies in invest no more than 60% of your assets. In this sense, the profile you present as a small and medium investor will have a lot to do with it: aggressive, moderate or defensive. Depending on this parameter, you will be able to flexibly target your savings. But always maintaining a liquidity cushion for a few months. In addition, it will provide you with greater security to carry out operations in the financial markets.
On the other hand, you cannot forget to define what will be the period of permanence to which you are going to allocate your investments. Because indeed, It is not the same to go to the short term than to the long term. Because they will require completely different strategies from the beginning. And even to plan the household budget in each year. As you can see, the investment is more than making the savings profitable directly. It requires a specific treatment that you must manage with great care. Because you cannot forget that you are risking your money, and in some cases under very large amounts, as to leave everything to improvisation.
Partial sales as a mixed solution
One of the alternatives that you have at the moment is to make partial sales instead of total ones. What do you get by using this strategy? Well, very simple, stay in equities while you enjoy the capital gains generated in your operations. It is an intermediate technique that allows you to manage your investment from a much more flexible approach than before. Depending on the evolution of the equity markets. This should be done when the markets lose strength or go from an uptrend to a bearish one. While in bullish scenarios its application is not very effective. Because you can miss a good part of the bullish movements. But on the contrary, it is time to continue in the market. Until the first signs of weakness are generated.
Partial sales, on the other hand, will help you to face the most urgent expenses of your personal or family finances. The key lies in choose the moment where to formalize these sales orders. Under the proportion that will be determined by the strategy you use at all times. Even as a very original formula to collect the money from your dividend payments. In any case, you will not always have to make this kind of special sales. Only when the financial conditions require it. Don't forget it for any kind of mistakes or bad trades in equities.
Let the benefits run
Other scenarios that may arise is that your investments are immersed in a long-lasting uptrend. Well, in these very particular situations, you will have no choice but to let the accumulated benefits run over the years. From this procedure, a very practical idea is not to abandon positions and accumulate profits. Until the precise moment in which any sign of weakness is generated on the price quotation of the selected security. For this strategy to be carried out, it will be completely necessary that it be carried out from a trend that is as bullish as possible. So that the risks are significantly lower.
It is a technique used by an increasing number of small and medium investors. Among other reasons because it is very easy to apply and even less experienced savers can develop it with very little difficulty. The only drawback is finding the levels where you have to abandon the positions. In any case, through technical analysis you will have the opportunity to detect a tool to achieve the objectives. As for example, abandonment of a moving average of some relevance. This effective strategy almost never fails for these special occasions.
A lot of attention with the supports
You will also have another instrument to move to liquidity in your savings account. It is about taking advantage of the price levels that the supports provide you in the formation of prices. Because it is indeed an area where it is exceeded, you will have no choice but to close positions in the stock market with special urgency. Not through partial sales, but on the contrary in a total way. So that later they are in the best of dispositions to re-enter the financial markets. But this time by means of much more competitive prices as a consequence of the adjustment in the quotation. Up to the point that the stock market proposals will have a much more important revaluation potential than until now.
On the other hand, if you verify that it resists these supports, it will be a sign of great strength. And that you will have to respond by means of a very aggressive stock purchase. Because it will have an upward journey more than relevant. Without any obstacle until the next resistance and what can it mean a difference above 10%. In any case, you will not have any kind of problems to execute this basic strategy for all investors. Whatever profile you present as a stock user. Because what it is about is to make the cases profitable and the higher the percentage, the better it will be for your personal interests.
Sales as a result of dividends
Another very different approach is the derivative of sales after receiving dividends. In these particular cases you will not have another solution if it is your wish that finalize the operation. To go to other securities with better prospects in their price. While you will enjoy the interest generated from this payment to the shareholder and that will go directly to your savings account. In this sense, you should not forget that the prices of the securities that go through this situation take a few sessions to recover their previous price. Because this money is discounting from dividends. Although in most cases this scenario is fulfilled in equities.
With this kind of values what you should not do is sell the shares before the distribution of the dividend. At least if you do not find high capital gains in its current valuation. What happens next will already be your personal decision that will be determined by a series of strategies that you have in your mind. To the point that the most defensive investors choose to maintain their positions. Even for many years if your strategies are going to be aimed at forming a stable savings bag for the next few years. In any case, it is something that you will have to decide based on your investment needs.
As advice to make the operations profitable, the most sensible thing to do is based on going in favor of the trend. That is, hold positions on bullish movements and sell on bears. It is the best way to avoid making as few mistakes as possible from now on. Where you can count on the invaluable help of graphics. Because they are the ones that will give you the necessary guidelines for your actions in the equity markets. Regardless of the profile you present in each of the moments.