Greed is something that investors often feel on their own experience.
Greed has no top, no point of satisfaction. But that's not the true goal of
investment. It's clear for everyone that the investment aim is profit. Real
and tough competition starts when there's a profit from risky penny stocks otherwise commonly known
as micro cap stocks.
If you are decided on small cap stock, you should set realistic
expectations on the profits and specific targets. Trading small cap
stocks is a very careful process. Whether it is after an increase of 50%
or 200%, you should know them and stick to them.
As SmartMoney.com reports, since most small cap
companies don't have the global revenue of Home Depot or Microsoft,
they're supposed to suffer when the U.S. economy sputters. There're more
factors that may keep you hesitating as an investor. Still, the risk can and
will be the path to your success, if you act smart.
If you trade small cap stocks, it is not so dangerous to set a target
sell point at 40 or 50%, then increase this if the stock starts rocketing
toward 100% gains. But be smart enough not to use the stock's move as an
excuse to throw your original targets away and hold out for 200% and 300%
profits.
In other words, the bottom line must always be to focus on achieving
gains that you are happy with, and that are in line with your original
expectations for the shares. It's always better to act on expectations, not
hopes.
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