Saturday 14 January 2023

Stop-loss, Cut-loss for Switching Horses and Position Sizing and NO Leverage! (2)

Wah! Uncle8888 was very surprised when he read  If I am a dividend investor, this is what I would do….

4. No earn no sell especially for dividend stock. Keep long term, no stop loss policy because point 1 is followed.

This rule is contrary to what most people would do. No cut loss policy.

I have learnt this rule from Createwealth8888. If you didn’t do any leverage/plan allocation well (Rule 3) and only buy good stocks that let you sleep well (Rule 1), there is no need for you to cut loss.

Price drop, just hold and collect dividends as Panadols. Throughout the years, treat the dividend (or simply use the Trading around Core Strategy – Rule 5 below) to reduce the average cost of your shares. The worst case is stock goes to zero or in most case, your average cost will be reduced over time.

Read? Stop-loss, Cut-loss for Switching Horses and Position Sizing and NO Leverage!


at

4 comments:

  1. Singapore Man of Leisure14 January 2023 at 12:48:00 GMT+8

    CW,

    Well, Mr Influencer, up to you whether you want to give your "parrot" a little nudge on context...

    I'll give chance. It's just an "aspirational" this is what I will do post...

    The core of his thesis sounds a bit like, "Only buy stocks that go up; stocks that don't go up don't buy."

    Awkward pause.

    Buy big; never cut. The most go to zero only ...

    Your money management only works because you have your 10 baggers to dilute out your zero baggers.

    How many dividend investors got any 10 baggers in their portfolios?

    Eh ...

    I am "poking" you CW. He didn't know better. But you?

    The kit-kat break is over!

    Lol!

    ReplyDelete