What to do if you're trapped? Don't panic, here are five tips to help you get out!!🔥🔥🚀
First tip: Cut your losses
When you find yourself buying at a high point and the market trend deteriorates sharply, you must have the determination to cut your losses decisively, sacrificing the vehicle to save the captain. As long as the market is still there, there will always be a chance to turn around; cutting losses is suitable for the early stage of a bear market when the losses are relatively small.
Second tip: Switch stocks
This is suitable for the early stage of a bull market. The core idea is to replace the weak stocks you hold with strong stocks. Strong stocks are often the leading ones in the sector during a bull market, and holding onto them can yield excess returns!
Third tip: Short selling
If you are deeply trapped and cannot cut your losses, and the market is still in a downtrend, you can first sell your stocks and wait for them to drop to a lower position before buying them back at the right time. This can effectively reduce costs; short selling is suitable for the mid-stage of a bear market.
Fourth tip: Intra-day T+0
This is suitable for a fluctuating down market. The specific approach is to do short-term trading around the stocks you hold, buying low and selling high, using short-term profits to lower costs; this tactic requires you to have ample monitoring time and good fundamentals, otherwise do not try it lightly.
Fifth tip: Averaging down
This is suitable for the end stage of a bear market when the index is oscillating at a low level or moving sideways. The scale of averaging down should be within your means; the core of averaging down is to wait until the bottom is confirmed before acting. Do not rush to break even or blindly average down, otherwise it will become a strategy of adding fuel to the fire, leading to deeper traps!!
