One Of The Most Shockingly Silly Stock Trading Concepts Of Most Traders

In stock trading, the saying let your winners ride is much more challenging than a lot of traders believe. To let your winners ride suggests do not freak out over ridiculous stuff.

A trader I know, Steve, sold out of a strong uptrending stock for a 3% gain. The next Monday when trading started, the stock continued to go up. Steve was bummed that he did not hold the stock a little longer.

Part of just how I coach stock traders consists of analyzing their thought processes and their triggers for doing things. Had Steve said that he found something on the chart (based in mathematics) that made him prefer to book profits, then things would've gone in another way.

I asked him what made him close out of the stock that Friday. He said that he just didn't like to hold the stock going into the weekend.

What is he talking about?

Professional traders will often close out positions on a Friday. You aren't some institutional trader with millions of dollars at risk. You're not a market maker either. You do not have a whole lot of funds in jeopardy.

Do not forget, the objective is to let your winners ride and cut your losers short. If someone makes a rule that you cannot hold a stock over the weekend, then you're not letting you winners ride. You will instead be letting go of your winners too fast.

Steve sold out of a strong uptrending stock for a foolish reason. You can not sell out of stocks for foolish reasons if you wish to let your winners ride.

You'll find that there's going to be quite a lot of stuff that bother you in stock trading. One of the things that should not bother you is if you ought to hold over the weekend. You shouldn't stress the tiny stuff.

Making a rule like you're not able to hold any stock over the weekend works best for professional traders nevertheless it's not going to work for you.

Creating rules of this nature is like trying to punch your way out of a paper bag while tying up one arm. Do not put arbitrary obstacles in your way like thinking I can only make profits Monday thru Friday but I have to sell on Friday because I won't hold any stock over the weekend.

A number of investors put a lot of obstacles in their own way. I recall a trader I met who'd only purchase blue chip stocks that paid a dividend. He also was a Christian and therefore the company would have to be morally ethical. Additionally, he had quite a long time horizon and therefore it needed to be a stock which he was able to hold for about five years. He came to me and wanted to understand what I could do to assist him in becoming a profitable trader as he was not capable of making money in the stock market. When he told me all the rules he used in his trading I just began laughing. I put my hand on his shoulder and said that he ought to either accept the fact that he's stupid, or that he'll never make money in the stock market and therefore he should get out.

Do not put obstructions like these in your way. Trading is hard enough without tying and arm behind your back, wearing only one boot, and putting on a blind fold.

Let the market tell you what to purchase and when you need to sell. If you are in a strong uptrendng stock, just chill out and enjoy the ride. That's the best way you are going to genuinely be able to let your winners ride.

For more stock trading lessons check out this one on the opening range breakout