Selling Rule of Thumb?

[steelman]

Is there a rule of thumb for gains and when most sell? Should I be holding out for 15%-20%. I bought AZK at $4.42 and within a couple of days it went to $5. This would have been about 13% gain. It's now back to $4.48. Should I be taking those gains? It does seem like limiting the losses to 7% is common here. Any ideas or advice, as always is greatly appreciated.

[Karel]

I would say there is no rule of thumb: an exit strategy needs to fit the overall strategy. A 7% stop loss strategy with a Buffet-like buy-and-hold strategy makes no sense. With $$$Mr. Market$$$'s medium term strategy it is also not a very good idea, see my analysis: Stops are for wimps (http://www.mrmarketishuge.com/showthread.php?t=562). But in swing and day trading stops might save your butt.

So the question really is: what is your preferred style of investing?

Regards,

Karel

[steelman]

I would say there is no rule of thumb: an exit strategy needs to fit the overall strategy. A 7% stop loss strategy with a Buffet-like buy-and-hold strategy makes no sense. With $$$Mr. Market$$$'s medium term strategy it is also not a very good idea, see my analysis: Stops are for wimps (http://www.mrmarketishuge.com/showthread.php?t=562). But in swing and day trading stops might save your butt.

So the question really is: what is your preferred style of investing?

Regards,

Karel

Karel,
I am definitely not day trading. I don't want to buy and hold long term, as my roth and 401 are funded with mutual funds for the long haul. I am not sure what it's called but I want to buy and sell in the short term, if that makes sense.

[Karel]

Well, then I don't have much more advice for you. There are several people here who trade rather short-term. Perhaps they could give some insights. You could check who is doing well in the POTW competition (you could even join!) and check their posts for trading style, and ask questions.

Good luck!

Karel