Get out before your profits fades away.
There’s a lot of money to be made in buying and selling hot stocks.
It’s all about momentum, and knowing when to get out will undeniably enhance the opportunity to make great money.
It’s a known fact, nearly all stock sooner of later will implode.
Most people shy away from hot stock because they don’t know how to calculate the momentum.
When talking about Hot stocks, I’m talking about really hot speculative stocks.
The kind of stocks that have very little research done by major wall-street broker houses.
So how do you know when it’s time to SELL!
Do your homework, be disciplined and do extensive research about the company you are involved with, this is your main guide line. It’s the key to find out when interest has peaked, and it’s time to GET OUT.
When you have a stock that is literally on fire, the primary key indicator to look out for are the professional or wall-street analysts who are covering the stock. If your hot stocks have more than four analysts covering it, This means everyone who was interested in the stock have already purchased it, the awareness of the stock has already attracted to many investors who want a piece of the pie and eventually the running peak will end. Not always, but usually this is a good indicator that the stock will shortly reach its peak, and as a rule of thumbs, you should SELL and reap the benefits. Even if the stock continues its run, your mindset should not be looking at how much money you would have made but how much money you would have lost if the stock falls.
A falling hot stock can crash within seconds.
It’s always better to take the gains and clear out before your profits fade away.
These stocks could bounce back, but usually never with the same previous momentum.
So as a guide line, stock usually cool off when there are more than four analysts covering it.t.
The bottom line, Most speculative steaming hot stocks are well worth owning, but you must learn when to sell, and that learning curve arrives when you notice to many analysts are jumping on the band wagon.
You can easily find out how many analysts are covering the stock by typing the symbol of your stock in the Yahoo finance “GET QUOTES” research box.
Once you land on the main page of your stock, on the right side menu just click on the Analyst Coverage link.