A simple way that you can become your own investment advisor using the trend following plan developed by Dick Fabian.
Step 5, Know When To Sell
One of the reasons we strive for, and believe we can attain, a higher growth rate is that we don't participate in significant market declines.
You must have a sell discipline. As trend followers, we use our "trend line" to make our clear buy and sell decisions. Our trend line (daily moving average or weekly moving average) is our line in the sand. It doesn't matter if we use the 200DMA, 40WMA, 50DMA or the 10WMA. We make the trade when we get the signal.
One of the keys to attaining a higher compound growth rate is to move to the safety of cash, or go short (inverse), when the market says to.
As outlined on the "What is Trend Following?" page, we sell all positions and move 100% to cash when the market tells us.
The "experts" say not to worry, you are in for the long term. The market always comes back.
If you hold a mutual fund, exchange traded fund or an individual stock, you must have a sell discipline.
If you take nothing else away from this web site, let it be this.
You must have a sell discipline.
I can't say it enough.
YOU MUST HAVE A SELL DISCIPLINE!