It is relatively frequent that when the profits arrive in your investment portfolio, you plant in the management the abandonment of your positions quickly to enjoy the generated capital gains. But it can also be a serious mistake on your part that stems from the lack of definition of a correct investment strategy. You must make it according to the profile you present, the terms to which the investment is directed, and even what your priority objectives are.
Nor do you know how to apply proper management, you can leave many euros on the way. More than you initially think. To the point of miss the most bullish scenarios, where it is more advisable to wait before undoing your positions. Until you get better prices in your quote that allow you optimize operation in equities under better investment management.
Before you opt for an advance sale, it will be more than necessary that combine safety with risk as a strategy to preserve your personal interests in the equity markets. It is not always easy to do it. Even with the real risk that the management of your savings is not carried out according to your interests, and that in the most unfavorable cases they will even lead you to negative situations with respect to the prices of the securities.
Management on the stock exchange: define the objectives
When you have managed to enter capital gains in your operations on the stock market it is normal that you consider whether you must sell your shares collect the appropriate benefits, or on the contrary, wait for these to intensify. For this to be the case, you will have no choice but to redefine the objectives of your investments. The decision you must make should be based on very well defined criteria. Where it will be really necessary that it is based on objective criteria in the investment.
In any case, you can wait for your goals to be met, such as profits reaching 5%. Do not set unrealistic goals, or at least you know how difficult it is to achieve them. In the end you will always lose out in these situations in the financial markets. The approaches must be objective and the most adjusted to the real conditions of the equity markets. This decision will not always be the same in a bullish period as in another with a contrary trend. Don't forget it if you don't want to make a particularly serious mistake.
Not of less importance will be establishes a criteria to achieve suitable terms of permanence to your profile as a small and medium investor. Not surprisingly, it is not the same to establish a three-year stock market maneuver than for a much longer period of time. Each period of time will necessarily have its own investment strategy, which you must apply with total discipline.
Is it time to close the positions?
It is one of the key questions in any investor, and on which the result of the operation depends. Not in vain, there is always the temptation to close positions to collect capital gains when you get to winning positions. Is this conservative strategy worth it? Well, it depends on each case, and especially on the criteria on which you base the operation of your movements in the financial markets. They will not always be the same.
In situations of strong stock market instability, it can be a success on your part. But not in others more favorable to your interests, as you will have been able to verify on more than one occasion. In this particular case, it will be more advisable to run the benefits until you reach your goals. Until the equity markets offer some sign of weakness or trend exhaustion. It is a fairly reliable way and one that is recommended by many market analysts.
It will also be very necessary that you take into account the bearish periods. In them few investment strategies are worth, much less that they are effective. Sales is the best of the alternatives that you can take advantage of from the beginning. Especially if your approaches to make the savings profitable are intended for the short and medium term. Never in the most expansive ones that will require other different treatments.
Infringement of levels of importance
Another strategy of special relevance is configured when you have no choice but to abandon the positions when the price of the securities has broken some significant support, or levels of vital importance for the future of the quotes. It will be all a sign that will indicate that you have been confused in the investment and, therefore, it will be better to undo positions that the losses are dangerously installed in your investment portfolio.
A scenario very similar to the previous one resides in the appearance of bearish movements that you can identify through the charts or the analysis of the prices. It will be a very clear starting point for you to abandon the management of values. With all certainty that in these scenarios there is more you have to lose than to gain. Remember it before a mistake can override your most beneficial decisions.
In any case, there is always a solution, even for the most difficult problem to solve. In this particular case, I would start by analyzing the technical aspect of the value. It will indicate that it is the right time to sell and that your investments could be complicated if you do not execute an order of these characteristics to preserve the capital of your assets. You will certainly have developed this experience more than once in your long career as a stock investor.
Seven recipes to manage your investments
It will never hurt that you follow some simple guidelines to decide at what time or not it is convenient to exit the market with small capital gains, or on the contrary wait for the prices to go to more advanced positions. And with it enjoy some more generous capital gains. However, it will depend on your personal reasons, the profile you present, and even the total amount of the investment. These will be, in short, some of the keys for you to achieve your desired goals.
- Under no circumstances should you sell your shares in bullish scenarios in equities. However many your earnings are until then. The main idea that the raises can make you earn much more money will prevail.
- Try to detect the weaknesses of the financial markets, and they occur with a certain frequency, then yes, it will be time for you to value if you are going to undo your movements in the stock market. A withdrawal in time can be a victory in these situations that we ask you.
- Never focus on utopian goals or unrealistic. They will not help you at all in the investment, quite the opposite. You can even look at a minimum profit as a preamble to closing positions in the equity markets.
- If stock market conditions so advise, instead of selling you have to do the reverse. And that in this case it would be solved with buybacks of the shares. With the sole objective of promoting the revaluation of your investments, to more satisfactory levels for your interests as a saver in this sector,
- Do not forget in any of the scenarios that your investment portfolio should be based on bullish values. They are what will give greater protection and security to your proposals. Even knowing that its trend can change at any time. Even when you least expect it.
- If you want to gain more confidence in your approaches, the best solution will be based on a exhaustive case monitoring on quotes of the stock market values. In which all the relevant news generated by the financial markets are included.
- As a final requirement, it will always be better to abandon it in time that you can be mortgaged for the future for a bad management in the subscribed securities. You must think that at the end of the day it is your money that is all about. And not with these things you cannot be playing, nor is it experimental.
The keys to good management
The management of equities will be decisive for your operations to be completed successfully or not. Apart from learning that you can contribute to its maintenance. You must have a lot of cold blood, but above all do not let yourself be invaded by emotions. It is common that in certain negative situations you opt for the sale of your shares as the best solution. Well, not in all cases it will be the best alternative.
Another very useful tip for these situations is that you only invest the money that you will not need for a good part of the time. Calculate the expenses that you will have to face in this period: tax obligations, the children's school, household bills, and of course the odd expense not foreseen in your family budget. Meet this objective if you do not want to take more than one negative surprise over the next few months, even years.
Another aspect of great importance is that it is always easier to make profitable operations in the medium and long term, than in the shorter ones. Although if you see that you soon put yourself in a capital gains situation, it can become the perfect excuse to undo positions in equities or other alternative markets.
These kinds of operations can be carried out under different modalities. Well under total or partial sales, depending on the profile you present as a small investor. You can also combine them depending on the situation in the financial markets. It will not always be the same and that will give you more flexibility for the current one. In the stock market it is not convenient to be closed to all approaches, no matter how unfeasible they seem to you now.