I keep lots of my stocks in IRA, IRA Roth and SEP accounts.
After observing stock market for a while, I have this idea of speeding up my earnings.
Usually I try to spend at least $1,500 per purchase on my stocks. Or if I am not sure in stock or short on money, I might spend less.
My point is - most stocks keep fluctuating in pricing. 52 weeks high/low pricing is a great example.
I try to buy my stocks on bad news at their lowest or close to lowest price. Then usually after some period of time stock's price will come back to original price or even higher. Then company might have another bad report and price will fall again. If I keep stock without selling I will just earn my dividends and see how my stock's prices jump back and forth - feeling happy on good earnings reports and a little worried on bad days.
But what if I pick certain amount as a point for sale and I will try to do it every week or every other week for different stock? Lets say I pick $300 or $400. So if any of my stocks earn this amount, I sell it. Then I will buy a different stock, which is on sale. By following this strategy, I can earn between $600 and $1600 extra money per month and reinvest it. I could add between $7,200 and $19,200 to my investment portfolio without even doing much extra. I already watch market every day. Even if I do it just once a month, I still can earn an extra $3600 - $4800 on top of my dividends earning.
What do you think about this strategy?
I think I will try to follow this way and I will update you in a while.
It is a strategy some traders recommend. I have seen traders recommending this for the whole portfolio in a slightly different manner - set a goal and once your portfolio reaches it, take the money out. Let's say you have a 50,000 portfolio, you set a goal to make 60,000 (10,000 in returns), once you reach that number, take 10,000 out and invest into something completely different.
ReplyDeleteWell, the question with your strategy is, how often do you expect your stock making 300 - 400 weekly? Unless you invest thousands of dollars I didn't see my stocks making this cash. I also invest circa 1000 per purchase and own a few of dividend stocks and some made 400 - 500 profits just now three years after I purchased them (dividend excluded).
Thanks for your input Martin. yes, looks like some stocks I will sell once in 3 years and some probably even rarely, but if you bought stock on bad news then there are more chances that they will come back faster. I have some examples in my portfolio of stocks such as WIN, FTR, EXPE which I bought beginning of the year and they already made 30-50% in profits.
DeleteI've always thought about it but never really wanted the stress related to it. I think if I trusted my gut feeling on some of these then I might have made some decent money. But the downside is that some of these trades I probably would have missed out on a huge upside for. There were times where I thought I should have sold my Tesla stock, and usually on those occasions I would have been correct because it usually pulled back after running up or when it crashed down I knew it would go back up and middle out somewhere.
ReplyDeleteThe problem I have is that I don't think I would be good at picking a new entry point. Perhaps it would be a good experiment though, I might try it one day.