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URL:  https://boards.fool.com/i-wonder-how-to-save-myself-fromthis-situation-34808226.aspx

Subject:  Re: The Captain' s ARK Performance Date:  4/15/2021  9:26 PM
Author:  RaptorD2 Number:  117556 of 118099

I wonder how to save myself from.this situation?

Sorry you feel that way, Bella.

If by "this" you mean your current situation, it's too late. You now have 3 choices: Sell, Hold, or something in-between.

If by "this" you mean the next time it happens (and it will) then I like the method used by a T/A expert at an investing site I recently joined. I "get" T/A and know some who make great use of it, but when I've tried to do it myself, I often come up with several different conflicting ways of interpreting moves, so without further study and learning, I can't do it. But this guy is incredible, hardly ever wrong and catches all the big moves right before they happen.

Anyway, he doesn't buy a new position without a stop-loss order to accompany the position unless he's quite familiar with the company. Say he's buying a 1% starter position in something new and speculative. He would place a stop-loss order at maybe 5%, meaning he could lose 5% and then his position would be sold at market pricing. If it gains 5%, say, he might loosen the stop to 7%, and so on, until he's familiar enough with the company to have confidence that it won't suddenly drop through the floor, and then may eliminate the stop-loss order altogether. Or, if still flaky, he would just keep a stop-loss order on the position at a higher percentage of loss that is allowed.

Some people think this is a chicken-$hit way to go, but I don't. It can sure save a lot of heartache when you're buying a speculative company for the first time. I've used the method, but very seldom; I figure if I don't know the company well enough to understand what they may do going forward, maybe I shouldn't have bought in the first place. But like all rules, I make exceptions when I think it will be to my advantage, and in this case, I can think of numerous "first buys" I've made where I wish I had used stop-loss orders. Dozens. Hundreds. Thoxxxx. Lots. :)

Good luck, B & all,

Dan
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