When do you get out of an investment?


An investment is like a plant, to get a little sentimental. We must sow it, let it grow and see how it begins to bear fruit. However, what if those fruits are left too long in the tree? Well someone will come and take them, make cakes and sweets and you will not see a single weight of it. The fruit may fall off the tree and be lost on the ground. You will not want to spend the same with your money.


Investment can be an art and in fact, many of the ‘King Midas’ market are constantly talking about the subject. For Warren Buffet, the millionaire many investors are still in the market, those who are beginning to understand the issue must diversify have multiple products to offset risk exposure within the market. We better not are entangled do not put all the eggs in the same basket says the most popular board on the subject.

Never be afraid to order too much when you sell, or offer very little when you buy,” Buffet has also recommended. The truth is that ambition, the desire to feel like a ‘Wall Street wolf’ and get carried away by bad advice, leads many people who risk their excess liquidity in capital market products to wait too long before picking up The fruits of investment.

In every investment, there are three steps: the entry, the one to keep and perhaps the most important of all the one to get out. It is in the latter that presents the most difficulties for the investor. First, what is investment? The simplest answer is to put money into a product and expect profitability. I wish everything was that easy, but then anyone with a ticket and a calculator could get in and out of the market.

The truth is a bit more complex because in addition to knowing how to use the money. The investor must start to make their analysis choose the right product for their investment, know their risk profile, even rely on the ability of an advisor on the recommendations to allocate that money in the most striking option.

There are different methods that help us make decisions about the best time to enter a specific investment and when to go out. It is therefore important to define the profile of the investor you have, how much tolerance you assume against the risk, the investment horizon, the amount, the intermediary that will give you the backing, the company that puts the titles and other conditions.

When you have become accustomed to the terminology, make your own plan to withdraw from that investment. We do not want to see what many shareholders lived in 2012, when that stock was above $ 5,000 and many went out to buy these stocks and now do not know what to do when the price of this species is at $ 1,370. Therefore, with other securities that is traded in the bag.

Determine your profile: that is very important. Many people entering the market do so by believing themselves conservative. After a while, they begin to feel comfortable with profits and forget that they came in thinking of collecting profits in one or two years. It is the most common mistake they make in investments, to see that as their bet is going well, they expect more profit and they do not withdraw according to the original plan.

Do not take ‘staggered’ gains: if you are, doing very well take some profits and invest in other products. Do not risk everything on the same alternative, because what happens to many who wait for the product to ‘mature’ and then are regretting why they did not listen to the advice to withdraw a little, reinvest it and lower exposure to risk.

They withdraw when everyone does it: when that happens, it is because the business was ‘damaged’. If you wait for ‘Where does Vicente go? Where are the people going?’ He is risking not recovering his money, but he may lose everything. The massive withdrawal is a sign of mistrust and usually occurs as a prelude to a crisis.

Do not watch the market: if you leave money in an investment and only care about the 5 years of how your product is, do not expect exaggerated profits. At least, if he never read a report, he called his advisor or he was never interested in the market news. In that case, you are not the type of investor that ‘pulls’ much to the market.