Here is a great question from a Trending Stocks subscriber:
If I have additional money should I buy a different stock or add to a stock I already own?
First, invest in a portfolio of 20 stocks.
Once you have a portfolio of 20 – 30 stocks, then a good place to invest new money is by making an additional investment in one or more of the best performing stocks you already own and feel confident investing more money in.
In making that decision, you want to consider this:
Has the stock’s price moved up to a point where your current stop loss or trailing stop is now locking in profit versus still reducing potential losses?
For example, you originally bought a stock for $50/share with Trailing Stop of $45. The stock’s price has advanced and the Trailing Stop is above $50, now at $53. Once your stock price is in this “positive position” it’s a great place to be. Even if your stock were to hit its stop loss, you would still walk away with a profit.
If you are ready to buy more of that stock make sure that your “new” Trailing Stop loss is set at a price where you will not suffer any loss of your earlier investment should the stock hit a stop.
So, you would only be interested in adding to your investment in that stock if the new price was now at least in the $57-$60 range or higher depending on volatility but high enough to allow you to set a Trailing Stop loss above $50.
Check out the Today’s Report on the Dashboard for that stock. It will help you by providing the new Trailing Stop Loss number to consider. Remember, the new stop loss needs to be higher than the ‘original’ stock’s purchase price.
Go to the TrendingsStocks.IO dashboard for help determining the number of shares to buy, where to place Stop Loss and more.
And please ask more questions; we love answering them! Send to email@example.com or just reply to this email.
Remember – Ride those winners and cut those losses!