I have a weird question to ask you…
Have the markets ever beaten up your investments so badly that you can almost physically feel each blow that gets thrown your way?
Because I’m going to let you in on a little secret most people in my position wouldn’t tell you… we ALL have.
I don’t care if your name is Warren Buffett or Joe Schmo – if you haven’t gotten beaten up on an investment – you’re either brand new to the business or a straight up liar.
I can honestly say that I have…
Everybody gets hammered in their career and I’d be leery of anybody that says they haven’t.
The problem is, even the most promising of picks has more going against it than for it…
Shorters, panics, world events, weather, etc. – they’re all working against you and your money.
Because, another little dirty truth in our industry is: any and every stock that makes money for its shareholders has beaten the odds in a deck that is stacked against it.
Sure, there are things we can do to minimize our losses, but there’s not much we can do to stop a stock from dropping in value.
So, what do we do to protect our money?
Well, the first thing is making sure you do your own due diligence before making ANY trade – and that goes for what I recommend as well…
I mean, I trust the GorillaTrades system implicitly, but you can bet your bottom dollar that if I was just a member of the service – I’d be doing a little research before I decided to hit the “buy” button.
Because as often as the GorillaTrades system is right, every once in a while – something can happen and turn a promising recommendation into a lame duck.
I also wouldn’t jump out of an airplane before checking that my parachute was in the pack… would you?
Of course you wouldn’t – because sometimes – just by doing the minimum amount of research, you could be protecting yourself from losing big time!
Why lose any money if you don’t have too?
Which brings us to my second strategy to protect your money – tight stop loss price points can help mitigate any losses incurred.
Have you ever watched the game show, “Deal or No Deal”?
If not, the premise of the show was that you picked a briefcase out of a selection of 20 something others, hoping you’ve picked the one with the largest amount in it – you then go through the process of choosing the other cases to reveal what’s inside…
Every time you’d reach a new level, the “Banker” would call the host and give him an offer to buy the case you have…
More often than not, the amounts he’d offer would be way above the amount in the contestants briefcase, but greed always seemed to rear its ugly head, and many would reject the offer and say “No deal” – and often times, at the end of the game, they’d be left with a fraction of what they could have walked away with earlier.
However, this wouldn’t happen to those contestants who went into the game with a predetermined amount of money they would take, as opposed to “going for it all”. Sure… sometimes they lost out on money they could have had – but they also secured the amount that they deemed worthy.
Stocks work in much the same way.
Using a tight stop loss, as well as modest price targets ensure that you continue to make money – instead of getting emotionally attached to a stock that’s going to take you down – just like the Titanic.
Sure, we could just go “all in” and put the recommendation out there, but that would be the same as sitting down at a Texas Hold’em table and going all in on your first hand… before the cards were dealt!
A tight stop loss would be about 8%-10% – I wouldn’t consider going any bigger than 20% and no more than a 25%-50% price target.
Now, that doesn’t mean there aren’t any exceptions…
But making sure to not be too greedy on these picks is another way to make steady gains – instead of keeping all that money you’ve made on the table with a chance to lose it all.
I’ve said it before, but the best thing to do when you’re getting hammered is to stay the course.
If you’ve done your due diligence and have a tight stop loss, yet your stock is getting hammered… just let it ride.
Sometimes drops happen, it’s the nature of the market, you can’t panic and sell out just because you’ve lost a few dollars on a stock that you feel has the moxie to make it.
In cases like these, go with your gut…
If you think it’s going to drop big, get out.
Just hope you make the right choice here, because there’s no worse feeling than cashing out with a small loss today, only to watch as you could have made a 20% or 30% gain the next day.
Trust me… that hurts.
Follow these three strategies, and you’ll have a good guideline to protecting your money from going down the drain
I can’t promise or guarantee anything, but I believe that keeping these three trading tactics in mind, you’ll profit more often than you’ll lose.
You could almost say that’s the GorillaTrades motto “Profit more often than you lose”…
And I’d love for you to allow our risk-adverse system to help you do exactly that!
But if not…
I’ve given you the tools to survive – it’s up to you implement them.
“You can do everything you can to try to stop bad things from happening to you, but eventually things will happen, so the best prevention is a positive attitude.” – Marie Osmond